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Production Limits Likely to Drop from Farm Bill as Negotiations Continue

Jan 22, 2014

As negotiations continue on the dairy title of the Farm Bill, it now appears that the Dairy Market Stabilization Program will not be included in the final version. Conferees are said to be looking at modifying the premiums and indemnities of the revenue insurance program that is included in the dairy titles of both the House and Senate versions of the bill.

Early last week Agriculture Secretary Tom Vilsack indicated that one way to solve the stalemate on the dairy title would be “to get the processors out of that mix.” He was referring to a provision of the Dairy Market Stabilization Program that would require processors to withhold payments from farmers who deliver milk in excess of their "base" level when milk prices are low relative to feed costs. Under the DMSP, the withheld funds would be submitted to the U.S. Department of Agriculture to make purchases of dairy products for donation.

Responding to Vilsack's comments, the conferees are now considering ways to allow USDA to buy what they consider "excess" dairy products with funds that USDA has available under existing authorities. An existing provision, known as Section 32, and used primarily to purchase specialty crops and meat products, could be changed or expanded to include dairy products.

Vilsack also said he was optimistic about getting a new Farm Bill soon. According to a report by The Progressive Farmer, Vilsack told members of the American Farm Bureau Federation, "We're not going to focus on permanent law until such time it becomes obvious to me that we are not going to have a farm bill. I am not there today. I am more optimistic we are going to have a farm bill now."

For more information, contact Jerry Slominski, IDFA senior vice president of legislative affairs and economic policy, at

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