Dairy processors push for long-term dairy policy changes

The International Dairy Foods Association (IDFA) said it will continue to advocate for long-term reform of dairy policies in response to Secretary Tom Vilsack’s announcement that USDA will provide additional short-term financial assistance to dairy farmers.

“Dairy farmers are our partners and are critical to maintaining a strong and viable dairy industry,” said Connie Tipton, president and CEO of IDFA. “We recognize that Secretary Vilsack is responding to the current difficulties faced by many farmers, but everyone should be concerned that we will be right back here in a few years unless we review and update existing dairy policies.”

According to IDFA, the current low dairy prices are due to the economic downturn, a decline in global demand for dairy products and an increasing milk supply.  IDFA believes that current dairy policies, which have been in place since the Great Depression, discourages innovation in dairy manufacturing and the use of risk management tools that are routinely used by other U.S. farmers.

Dairy is the only agricultural commodity for which USDA purchases surplus dairy products for government storage and determines prices through government regulation, IDFA said.

“Our members are concerned that an increase in government purchases of products, such as nonfat dry milk, does very little to expand the demand for nutritious dairy products, which is how our industry can grow,” said Tipton.

IDFA chair Paul Kruse, president and CEO of Texas-based Blue Bell Creameries, outlined IDFA’s recommendations for long-term policy changes when he testified before the U.S. House Agriculture Subcommittee on Dairy, Livestock and Poultry, which sets dairy policy for USDA. Kruse told the panel that product innovation and increased global demand are fundamental parts of any solution designed to address the economic conditions currently facing the U.S. dairy industry.

His testimony is available at: http://idfa.org/news/stories/2009/07/kruse_testimony_0713.pdf