Dairy Industry Advisory Committee Approved Final Report of Recommendations to U.S. Secretary of Agriculture

On March 3, 2011, the Dairy Industry Advisory Committee voted to approve a final report to submit to Secretary Vilsack. The report contains 23 recommendations to the Secretary, and reports its finding that existing federal programs and legislation had a limited impact on mitigating recent market volatility.

The recommendations include suggestions that the Secretary should develop a system that provides an accurate assessment of dairy farm profitability, review federal milk marketing orders, simplify and improve risk management products for dairy farmers, and use USDA farm loan programs and emergency interventions. With regard to price protection, the committee advised the Secretary to consider eliminating end product pricing, to collect and publish price data, and to adopt a growth management program. For income protection, the Secretary was advised to establish risk management margin lines of credit, modify the milk income loss contract program and provide a margin insurance option, and adopt tax-deferred farm savings accounts.

To improve the market, the committee recommended the USDA support competitive market structures, develop and expand programs for export markets, reduce the somatic cell count standard, consider adopting California-type fortification standards for milk, restrict the use of dairy descriptors like cheese on products, support value-added dairy, offer incentives for sound environmental practices, phase out ethanol subsidies, devise programs to eradicate TB and Jones from U.S. herds, and help farms employ year-round, long-term immigrant labor.

Many have responded to the committee’s recommendations. More than 30 CEOs of dairy industry companies have written to Secretary Vilsack, stating that they agreed with most of the recommendations but opposed the recommendation for a "growth management" program and were disappointed that the committee did not develop reforms of the Federal Milk Marketing Order System.

• Read full April 2011 Agricultural Law Update