Posted: Tuesday, December 04, 2012 11:09 AM
A national survey funded by International Dairy Foods Association shows the public does not support a government program to manage the supply of U.S. milk, IDFA contends.
The survey of 2,094 adults conducted online last month by Harris Interactive found 81 percent of respondents agree that decisions on milk production should be left to producers and not be made by the government. Only 8 percent supported supply management as an option to help dairy farmers when the price of milk falls to unsustainable levels.
Supply management is one proposal contained in the farm bill's Dairy Security Act, which passed in the Senate and stalled in the House. It's a measure strongly opposed by IDFA, which represents milk processors.
"The results show what I think is pretty intuitive. The broad, general public is not going to support a program that raises prices on dairy products," said Jerry Slominski, IDFA senior vice president of legislative and economic affairs.
It's an overreach to have supply management in light of no public support, and IDFA will use the survey data to make its case against the proposal in the press and on Capital Hill, he said.
The proposal, which originated with National Milk Producers Federation, is controversial among producers, but the survey shows supply management has little public support, he said.
The survey also asked respondents to choose the best approach to help dairy farmers from the two proposed in the Dairy Security Act, supply management and subsidized insurance against catastrophic losses.
The supply management choice in the survey was framed as "Keep farm milk prices high by implementing policies to limit how much milk farmers can produce." Only 8 percent of respondents chose that option.
The survey also asked consumers if they were aware that federal milk pricing regulations already keep the cost of retail milk higher than it would be without the regulations, to which 74 percent replied "no."
It also asked whether the price of that milk should be determined by what consumers are willing to pay or government policy, with only 9 percent choosing government policy.
National Milk Producers Federation contends the findings of the survey are misleading because the questions were misleading.
"First, the Dairy Security Act is not a mandatory program; dairy farmers can choose not to participate in it," Jerry Kozak, National Milk's president and CEO, said in a written statement.
"In addition, it does not set mandatory limits on the amount of milk a participating dairy farmer can produce. A voluntary program is hardly big government intrusion," he said.
"Second, the survey misleads because it clearly implies that the government sets retail dairy product prices. It does not," he said
Prices for dairy products are set by retailers and vary greatly from month to month, from city to city, and from store to store. That's the market at work, not government, he said.
Slominski disagrees, pointing out that the price of fluid milk is regulated through the government's federal milk marketing orders, wherein a price differential is added based on the price of milk used for manufacturing cheese.
"In effect, government policy makes fluid milk higher in price than it would be," he said.
As for mandatory supply management and limits on milk production, dairy farmers who participate in the margin insurance program would be required to participate in supply management, and in times of oversupply, they would be penalized for milk production above their historical base production.
Data in the survey was adjusted to be representative of the U.S. adult population, according to Harris Interactive.