Posted: 04.20.2010

Wisconsin Ag Secretary, Rod Nilsesteun, is one of 17 hand selected representatives of the dairy industry asked to serve on a Dairy Industry Advisory committee by U.S. Ag Secretary, Tom Vilsack.  The committee met for the first time April 13-15th in Washington, D.C.

Pam Jahnke visited with Nilsesteun about his impressions of the first meeting.  You can listen to the entire conversation here - with excerpts below.

Jahnke:  "Rod, it sounds like U.S. Ag Secretary Vilsack was pretty pointed on what he wants the committee to accomplish."

Nilsesteun:  "Well I think so.  It is an opportunity, rather then argue about one piece - to focus on trying to make a recommendation to him before the end of the year.  That's a pretty fast march for anything this comprehensive."

Jahnke:  "Did he give any indication on what area's he'd like the group to focus on?"

Nilsesteun:  "No, it's a much broader slate then that.  We're looking at existing policy from across the board - but it's clear the heaviest focus is to try to deal with the incredible increasing volatility that we're seeing in this industry.  Farmers are the ones taking almost all the risk.  You know you can't lose 40 percent of your equity and keep going.  You can't lose $100 per cow and keep going.  We know this is cyclical - but decreasing the volatility and spreading the risk is an obvious goal."

Jahnke:  "Did you reach any concensus?"

Nilsesteun:  "I expect what we'll end up doing is having several sub committees that will focus in on specific areas (CWT, credit, the role of exports, margin insurance for example) so that when we come back in June we'll have some more work done.  It is a daunting task, there's no question about that."

Jahnke:  "What about any short term relief"

Nilsesteun:  "Well that's what I tried to focus on more then anything.  Wisconsin is the number one user of FSA (Farm Service Agency) guaranteed loans - but we have a number of banks, whether they admit it or not, that are themselves under pressure from regulators and their finances may not be as strong as they were.  Those banks are not continuing credit for farmers that they would otherwise continue credit with - or for farmers that would otherwise qualify for credit with another bank.  .....Right now the FSA staff in Wisconsin is overwhelmed.  There was a 29 percent increase in volume for FSA in Wisconsin - that increased by 40 some percent for 2009-10 again.  There's no way that the same number of staff can get through that volume.  The point I was trying to make is that needs to be addressed."

Jahnke:  "How comfortable do you feel somethings really going to happen?"

Nilsesteun:  "Honestly, it's too early to make an assessment on that.  What I can tell you is that the ag secretary is very sincere about this and the committee is very committed to getting this done.  We're in crisis. We know this industry can't continue to deal with this kind of volatility and lack of profit. Are all regions going to be able to come together - I don't know.  Also, remember, most of the significant actions would have to be agreed to by Congress - and that's a whole different kettle of fish.  I think we're at a moment in time when we really have an opportunity to put our arms around the challenge in a way that hasn't been seen in a long time."

The next meeting of the Dairy Industry Advisory Committee will be June 3-4.

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