Dairy farmers consider supply management

The downward spiral in milk prices is fueling conversation on supply management in the U.S.

Capital Press

Four years of low milk prices and the loss of nearly 7,000 U.S. dairy operations has many dairy farmers warming to the idea of a national milk supply-management program.

National Dairy Producers Organization has been imploring farmers for years to balance milk supply with profitable demand. Now, the Wisconsin Farmers Union is also trying to unify dairy farmers on that front.

WFU started looking into the dairy crisis in 2016, noting an average loss of 500 Wisconsin dairy farms annually. Bobbi Wilson, WFU government relations associate, said a survey of the state’s dairy farmers opened the organization’s eyes to the severity of the crisis, and it began looking at options to address the situation.

This spring, it hosted a series of events with Canadian dairy farmers explaining how their supply-management program supports milk prices. Participation was high, and WFU was flooded with calls from dairy farmers across the country. That launched Dairy Together, an effort to change the dairy situation in the U.S., she said.

The goal is not to get people to support the same system used in Canada, which includes quotas that prohibit expansion, she said.

“But we need a mechanism to press the brake pedal when there’s too much (milk) and press the gas pedal when there’s not enough. We need a way to balance the milk supply with a price that’s profitable for farmers,” she said.

The industry is relying on increasing exports, but that’s not sustainable and is part of the problem, she said.

“It’s a race to the bottom to create the cheapest product for world markets,” she said.

WFU is seeing growing acceptance of supply management and market stabilization among producers. National Farmers Union supports inventory management, and it was one of the talking points to lawmakers about the farm bill during the September NFU fly-in to Washington, D.C., she said.

The conversation on supply management among lawmakers is shifting. There’s still some pushback, but there is a realization that something probably needs to be done, she said.

Lawmakers said they need to hear from dairy farmers, particularly National Milk Producers Federation, which represents about 80 percent of the national milk supply, she said.

In the 2014 Farm Bill discussions, there was support for supply management from producers in the suite of what NMPF was proposing to improve the dairy safety net, Alan Bjerga, NMPF senior vice president of communications, said.

Then House Speaker John Boehner called it Soviet-style agriculture, and that was the end of it, he said.

“It doesn’t seem that there’s a particularly more receptive environment now than there was then,” he said.

Supply management hasn’t really been part of the farm bill debate this time around, and it’s a matter of what Congress is willing to consider, he said.

One has to consider whether government is more or less free-market oriented than it was in 2014 and if politically such a plan would get through Congress, he said.

“You fight the battles you think you can win,” he said.

NMPF is focused on the dairy safety net and risk-management tools that are already in the farm bill. Improving those tends to be much more effective than throwing something in that changes the calculations for all the other commodities, he said.

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