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Dairymen weigh alternatives to suspended NASS reports

Published on March 29, 2013 3:01AM

Last changed on April 26, 2013 6:30AM


Capital Press

Dairymen and market analysts are concerned over the suspension of the National Agricultural Statistics Service's monthly milk production report through the end of the fiscal year, but the move hasn't provoked much industry reactions aimed at getting it reinstated.

In the meantime, one other option has surfaced -- to use checkoff dollars and information to compile the report.

The report, along with several others covering a variety of commodities, were suspended as part of the budget sequestration.

USDA's Office of Communications would not say whether the agency has had calls from the industry or lawmakers regarding the suspended report, but confirmed that there has been a lot of interest across all aspects of the dairy industry.

Idaho Sens. Mike Crapo and Jim Risch haven't received any calls about the report, according to their staffers. Rep. Mike Simpson, R-Idaho, has heard from a few people about the issue, said Nikki Watts, his director of communications. Rep. Raul Labrador's office hasn't received many calls on the issue, said communications director Michael Tate.

The decision to suspend the report is serious, as it is likely the most read and most accurate USDA report for the dairy sector, said Mary Ledman, editor of the Daily Dairy Report.

She believes the report was targeted for political effect because it is one of the most used reports by the industry.

Ledman pointed out that USDA did not choose to suspend less critical reports such as those dealing with mushrooms, honey or the Puerto Rico agricultural statistics.

"I think the administration is counting on dairy producers to call their representatives to encourage a budget resolution on a timely basis so that this report can continue," she said.

National Milk Producers Federation sent a letter expressing its concern to Agriculture Secretary Tom Vilsack on March 14 but has not received a response, said Chris Galen, the organization's senior vice president of communications.

The letter urged Vilsack to continue the report, stating it is vital to many basic activities in the industry, contributing to efficient price discovery, which determines milk prices for farmers. It is key to business planning and risk-management and provides critical information about supply and demand.

Western United Dairymen also contacted USDA and members of California's congressional delegation, said Michael Marsh, the organization's CEO.

"We are concerned about it. That information has an impact on markets," he said.

The report allows producers to ascertain how much milk is in the market, production trends and the impact on prices, he said.

Unfortunately, the sequester, which requires USDA to cut about $2 billion in across-the-board projected spending, is using a machete to do surgery that requires a scalpel, he said.

Loss of the report will severely limit information on milk production and cow numbers and introduce a lot more uncertainty and volatility into the industry, said Wilson Gray, extension livestock economist with the University of Idaho.

There is no way to get that data from other USDA reports, he said.

There is concern in the dairy industry over loss of the report, said Rick Naerebout, a staffer with Idaho Dairymen's Association.

The industry uses that information to judge whether milk production is increasing. Processors use it to estimate how much milk supply will be available for products, and dairymen use it to make decisions on milk pricing and marketing and animal purchases, he said.

"It's advantageous for everyone in the industry to have milk production information," he said.

But loss of the report could provide the opportunity to get that information from the industry through the dairy checkoff managed by Dairy Management Inc.

"I think it's something the national promotion group should look into," he said.

Bob Naerebout, IDA executive director, said elimination of NASS survey reporting of milk production has been one of IDA's policies since 2003. Instead, IDA supports NASS utilization of the checkoff promotion collections to provide the industry with accurate production numbers, he said.

Others have also suggested that Dairy Management Inc. could provide state and national production information, as the checkoff is funded by dairy producers based on their production.

DMI is looking into the matter, but won't have a definitive response until sometime next week, said David Pelzer, DMI senior vice president of industry image relations.


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