I.D.F.A. favors policy review over additional dairy support

by Keith Nunes
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WASHINGTON — The International Dairy Foods Association said it will continue to advocate for long-term reform of dairy policies in response to Secretary of Agriculture Tom Vilsack’s announcement that the U.S. Department of Agriculture will provide additional short-term financial assistance to dairy farmers. Mr. Vilsack announced that the U.S.D.A. will increase government purchases of butter, cheese and nonfat dry milk.

"Dairy farmers are our partners and are critical to maintaining a strong and viable dairy industry," said Connie Tipton, president and chief executive officer of the I.D.F.A. "We recognize that Secretary Vilsack is responding to the current difficulties faced by many farmers, but everyone should be concerned that we will be right back here in a few years unless we review and update existing dairy policies."

Mr. Vilsack announced that the U.S.D.A. is increasing the amount paid for dairy product through the Dairy Product Price Support Program. The agency estimated the price increases, which will be in place from August through October 2009, will increase dairy farmers’ revenue by $243 million.

Specifically, the initiative will raise the price paid for nonfat dry milk to 92c per lb from 80c per lb, the price paid for cheddar blocks to $1.31 per lb from $1.13 per lb, and the price of cheddar barrels to $1.28 per lb from $1.10 per lb.

According to the I.D.F.A., the current low dairy prices are due to the economic downturn, a decline in global demand for dairy products and an increasing milk supply. The trade association believes current dairy policies, which have been in place since the Great Depression, discourage innovation in dairy manufacturing and the use of risk management tools that are routinely used by other U.S. farmers.

"Our members are concerned that an increase in government purchases of products, such as nonfat dry milk, does very little to expand the demand for nutritious dairy products, which is how our industry can grow," Ms. Tipton said.

This article can also be found in the digital edition of Food Business News, August 18, 2009, starting on Page 42. Click here to search that archive.

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