Dairy Policy Reforms Included in Draft Farm Bill

US - The draft farm bill language released Friday afternoon by the Senate Agriculture Committee includes the key components of the Foundation for the Future dairy policy reform developed by National Milk Producers Federation (NMPF) nearly two years ago.

23 April 2012

2 minute read

North America

In preparation for an Agriculture Committee markup next week, Committee Chairwoman Senator Debbie Stabenow, along with Ranking Member Senator Pat Roberts, released the provisions Friday of the entire farm bill, including the dairy legislative language.

“The primary elements of NMPF’s comprehensive dairy reform package are included in this legislative draft, for which we are grateful,” said Jerry Kozak, President and CEO of NMPF.

“The bill reflects the best-possible outcome for America’s dairy farmer community, which is in great need of a better federal safety net than what we have now.” The package of reforms is also supported by many other state and national farm groups.

“We look forward to working with Senators Stabenow, Roberts, and the other committee members in building support in the Senate for this legislation.”

The Senate farm bill draft contains the major elements of the Dairy Security Act (DSA), introduced last autumn in the House by Reps. Collin Peterson and Mike Simpson, and included in Senator Richard Lugar’s farm bill plan. The core of the DSA is a margin insurance programme that protects farmers from dire economic conditions caused by either low milk prices or high feed costs. The margin insurance programme replaces existing dairy programmes, including the MILC and Dairy Product Price Support programmes.

Farmers will have the option of signing up for the margin insurance programme; if they choose to do so, they will then be enrolled in the Market Stabilization programme through which they will be asked to manage their milk output when worst-case conditions appear.

“We believe the approach the Senate Agriculture Committee is taking will generate broad, bipartisan support for the farm bill. This bill allows dairy farmers to better manage their risks, in a deliberate approach that offers a superior safety net, reduces government involvement in our industry, and positions our entire industry to compete in a global marketplace.

"It saves money compared to existing programmes, and will be affordable and convenient for farmers to use. Critically, it treats all farmers equally, and doesn’t produce regional or size-based outcomes that are inherently discriminatory.”

The dairy legislation begins at Section 1401 (page 68) in Title 1 - Subtitle D and goes through Section 1481 (page 111). To view the draft bill click here.