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March 4, 2008

Dairy farmers from 5 states speak out

Unusual grouping is encouraging legislators to include milk-producing cost into the price farms receive.

By Tom Venesky tvenesky@timesleader.com
Sports Reporter
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It almost seemed as though Pennsylvania dairy farmers were on an island. For years, they urged legislators to incorporate the cost it takes to produce milk into the price they receive for their product.

Dairy farmers in other states made similar pleas, but the call for change never extended beyond state lines.

Now, as the price farmers get for their milk is forecast to drop while the cost of fertilizer, fuel and feed skyrocket, dairy farmers across the country are joining together in their quest for change.

On Monday, five farmers from Pennsylvania, Wisconsin, California, New York and Minnesota held a press conference to get their message out. It comes at a time when the price for class I milk dropped more than $5 since September, along with a $7.20 drop for class IV milk. To compound the situation, dairy farmers in Pennsylvania can expect a 25 to 35 percent increase this spring in the cost it takes to produce milk. In January, area dairy farmers received around $22 per hundredweight for their milk, and Arden Tewksbury of Pennsylvania Progressive Agriculture Organization in Meshoppen said it costs Pennsylvania farmers $27.59 to produce 100 pounds of milk.

In January, Tewksbury predicted milk prices to drop $4 per hundredweight this spring.

If that happens, the price farmers would receive for their milk would drop to $18, while the cost to produce it would jump to over $30.

“It may be worse than we predicted,” Tewksbury said. “Dairy farmers are not receiving a realistic price that covers the average cost of producing milk.”

Price-support programs, such as the Milk Income Loss Contract (MILC), are ineffective, according to Wisconsin dairy farmer Joel Greeno.

“If milk prices were to drop to levels that the MILC would kick in, I would be losing $3,375 a month,” he said. “It would be pretty hard to pay the bills on that.”

Minnesota dairy farmer LoriJayne Grahn said the cost of production factor is critical because dairy farmers have no ability to raise their prices.

The answer, she said, lies in the cost of production, and the matter almost became a reality last year when U.S. Sens. Robert Casey, D-Scranton, and Arlen Specter, R-Philadelphia, introduced Senate Bill 1722.

Tewksbury said the bill incorporates national cost of production into the pricing formula, eliminates hauling charges for farmers and implements a supply management program that can kick in when milk exports equal imports. The bill has sat in the Senate Committee on Agriculture, Nutrition and Forestry since last June.

“Presently, the value of milk across the country is basically the same, and dairy farmers from every state agree we need a new pricing formula,” Tewksbury said. “We’re hoping we can get bill 1722 moving or something similar to it.”

Casey also attempted to include the cost of production as an amendment to the 2008 Farm Bill but failed to garner support from his fellow senators.

Casey spokeswoman Kendra Barkoff said Casey still believes cost of production should be included in the price paid to dairy farmers.

“Currently, he (Casey) is looking at all relevant legislative moving vehicles to include the cost of production,” she said.

Specter spokeswoman Kate Kelly said the senator is trying to raise the cost of production issue in the Farm Bill Conference Committee, and he has consistently supported a mechanism to ensure that dairy farmers receive a fair price for the milk they produce considering the increased input costs.

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