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Dairy Facts 2016

IDFA Advocates Funding for USDA Risk Management Insurance Program

Apr 01, 2011

Contact: Peggy Armstrong
(202) 220-3508

Asks Ag Committee Chairs to fund program for balance of 2011

Expresses pposition to so-called "Growth Management Programs"

(Washington, D.C. - April 1, 2011) Connie Tipton, president and CEO of the International Dairy Foods Association, has called on Congress to maintain funding for a federal risk management insurance program for dairy farmers. In a letter to U.S. Senator Debbie Stabenow (D-MI), chair of the Senate Committee on Agriculture, and U.S. Senator Pat Roberts (R-KS), ranking member of the committee, Tipton restated IDFA's opposition to any government program that would attempt to control milk price volatility but affirmed support for the Livestock Gross Margin-Dairy program. Tipton pointed out the program's increased relevance, with more than 1,400 contracts issued in FY 2011. Tipton cautioned that U.S. Department of Agriculture has nearly reached its underwriting capacity for the program and urged the senators to fund the program for the remainder of the year.

"Expanding this program is something that can be done now to help our nation's dairy farmers," wrote Tipton. "There is strong support among both producers and processors for the LGM-Dairy program. As it now stands, the program has insured about 2.4 percent of the U.S. milk production. Providing additional funding would make it available to more producers who may be just learning about the program for the first time."

The Livestock Gross Margin insurance policy provides protection against the loss of gross margin (market value of milk minus feed costs) on the milk produced from dairy cows. The LGM for Dairy Cattle insurance policy uses futures prices for corn, soybean meal and milk to determine the expected gross margin and the actual gross margin. IDFA has consistently advocated for a safety net for dairy farmers, including margin insurance like that offered through the LGM-Dairy program.

"While we understand current budget pressures, we urge you to consider funding the LGM-Dairy program for the remainder of this year so that our nation's dairy farmers can be provided the tools available to others in production agriculture," Tipton wrote.

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The International Dairy Foods Association (IDFA), Washington, DC, represents the nation's dairy manufacturing and marketing industries and their suppliers, with a membership of 550 companies representing a $110-billion a year industry. IDFA is composed of three constituent organizations: the Milk Industry Foundation (MIF), the National Cheese Institute (NCI) and the International Ice Cream Association (IICA). IDFA's 220 dairy processing members run more than 600 plant operations, and range from large multi-national organizations to single-plant companies. Together they represent more than 85 percent of the milk, cultured products, cheese and frozen desserts produced and marketed in the United States.


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