Posted: 01.28.2011

A new study by Informa Economics has concluded that the proposed Dairy Market Stabilization Program (DMSP), a supply management program, would have had an estimated $150 million withheld from Wisconsin farmers compared to California's estimated withholding of $28 million.  According to the study, California ranked 23^rd when calculating the percent of the withholding compared to total milk production in the state.

Informa conducted a full review of the DMSP which would withhold payments from farmers who deliver milk in excess of their "base" level, when milk prices are low relative to feed costs. Informa reported on the impact of this program, had it been in place during the 2000 - 2009 time period. The study also shows that with milk production growing year after year on farms of all sizes, payments could be withheld from all farms, regardless of size. By reducing revenue during periods of already low margins, the program will hit higher-cost farms harder than lower-cost farms.

 "At a time when our dairy farmers were forced to use all of their equity to stay in business, the Dairy Market Stabilization Program would add another financial burden on our struggling dairy farmers, while at the same time causing economic damage to our state's number one industry," said Jerry Meissner, DBA President.  "Wisconsin cheese makers have repeatedly told us there is a shortage of milk in Wisconsin.  In fact, they import 13 percent of their milk from other states."

"It is clear the Dairy Market Stabilization Program would be detrimental to all of Wisconsin's dairy farmers, dairy processors, the state of Wisconsin and jobs," commented Laurie Fischer, DBA Executive Director.  "This is not a good program for our farmers in Wisconsin, it will penalize us unfairly. We need to find programs that will support farmers, not penalize them."

"We need to stabilize the volatility of milk prices but this is not the answer to that problem," Meissner continued.

To read the Informa Economics report on the Dairy Market Stabilization Program visit www.KeepDairyStrong.com.

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