Posted: 07.18.2011

Representative Collin Peterson (D-MN) is circulating draft legislation around Capitol Hill which contains similar provisions from National Milk's Foundation for the Future program.  The Dairy Business Association expresses support for a strong risk management program and concern over Representative Peterson's supply management provisions included in this proposed legislation.

This legislation contains several changes to federal dairy policy; the two most prominent components are the milk margin insurance and supply management.  DBA supports a risk management program in lieu of the existing MILC program. The solution for Wisconsin; is not limiting milk supply; but increasing tools for dairy farmers to use to manage risk; such as milk insurance and dairy savings accounts.   However, DBA expressed great concern over limiting the amount of milk a farmer can produce under the supply management component.

Last year, Wisconsin cheese makers experienced a 16 percent deficit in the milk supply, according to the Wisconsin Milk Marketing Board.  In 2010, Wisconsin cheese makers produced a total of 2.6 billion pounds of cheese, while Wisconsin dairy farmers only produced enough milk to make 2.3 billion pounds of cheese.  Under Rep. Peterson's proposal, milk production will be reduced during periods of low margins.  If a farmer produces more milk than allowed under the program, they will be charged a fee which will be deducted from their milk check.

"Wisconsin dairy farmers receive a higher price for their milk than most of the other states because they are awarded for their high quality milk components," said Laurie Fischer, Executive Director of DBA.  "Wisconsin cannot afford to lose our cheese industry, our higher mailbox prices or allow Wisconsin dairy farmers to be charged for supplying a product the world markets are demanding."

DBA greatly appreciates Rep. Peterson's hard work and will work with him to develop policies that will enhance the Midwest's ability to produce a safe and healthy food supply for the world.

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