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House Dairy Subcommittee Approves an Excellent Foundation for 2007 Farm Bill The House Agriculture Subcommittee on Livestock, Dairy and Poultry last Thursday approved legislation for the 2007 Farm Bill that includes a number of positive steps to modernize federal dairy policies. Chief among them is making the former dairy forward contracting pilot program permanent. IDFA was pleased to see that the compromise bill doesn't include a provision to implement the dairy import assessment The bill would also renew the Dairy Export Incentive Program funds, making them mandatory, and maintain the Dairy Price Support Program."Chairman Leonard Boswell (D-IA) and Ranking Member Robin Hayes (R-NC) have clearly worked together in a bipartisan manner to forge a solid compromise bill that lays an excellent foundation for the committee's Farm Bill deliberations," said Connie Tipton, IDFA president and CEO. "We applaud their leadership and urge our members to work to support the bill." Making the former forward contracting pilot program permanent, which is part of the subcommittee bill, became a divisive issue as the bill was being marked up. The National Milk Producers Federation initially voiced support for forward contracting but, in a letter to the subcommittee the day before consideration, voiced strong opposition, calling for additional regulations and a program that would be temporary rather than permanent. IDFA will continue to support making the former forward contracting pilot program permanent and work toward its inclusion in the final Farm Bill. "Providing the ability for broader forward contracting as a permanent program will go a long way toward improving financial stability for more dairy producers and processors," Tipton said. "Throughout the Farm Bill process, IDFA members should urge their members of Congress to protect the unrestricted right for all Class II, III and IV milk buyers and sellers to use forward contracts." The subcommittee bill also includes changes to the Dairy Price Support Program and the Federal Milk Marketing Orders, setting specific product purchase prices and procedural deadlines that would speed the process for deciding federal order amendments. The bill would renew and make mandatory the Dairy Export Incentive Program (DEIP) funds, which subsidize dairy product exports. IDFA believes DEIP needs to be administered with care, because overusing the DEIP funds could artificially raise dairy prices at a time of record high milk prices. During the subcommittee meeting, Representative Jim Costa (D-CA) offered and withdrew dairy amendments that would create a commission to study Federal Milk Marketing Orders and mandate that California's higher nonfat solids standards for fluid milk be applied nationwide. There was a robust discussion on the need for and cost of a commission; Rep. Costa plans to present both amendments at full committee. IDFA favors the establishment of a commission but has long opposed mandating higher nonfat solids standards across the nation, because of the higher costs and lack of availability of fresh nonfat solids supplies in some regions. IDFA believes that it will be extremely important for Milk Industry Foundation (MIF) members to inform their representatives of the need to oppose the extension of California's nonfat solids standards to the entire country. "The subcommittee mark up was a victory for IDFA and its members," said Kristin Wilcox, IDFA vice president of legislative affairs. "Between now and when the full committee meets later this year, IDFA will continue to work with the committee leadership and staff to refine the dairy provisions of the Farm Bill and seek ways to maintain the balanced approach presented by Chairman Boswell." Congress must reauthorize the current Farm Bill before it expires on September 30, and this action by the House subcommittee is the first step in the process. These dairy policy recommendations will be considered and voted on by the full Committee on Agriculture as a next step. IDFA expects full committee consideration will occur around the time of IDFA's Washington Conference, June 20-21, and urges all members to consider attending to lobby for dairy reform. Although the subcommittee's recommendations did not include extension or funding for the Milk Income Loss Contract (MILC) program, the House and Senate passed the Iraqi war supplemental spending bill last Thursday with a provision to extend MILC. Once the president signs the war spending bill, which he is expected to do, $1.2 billion will be added to the Farm Bill baseline. This action will certainly spur debate over MILC and the dairy title approved by the subcommittee in the House Agriculture Committee when it takes up the Farm Bill draft. For more information, contact Wilcox at kwilcox@idfa.org or 202-220-3508.
Posted May 29, 2007
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