Congressional ag leaders seek Margin Protection Program for Dairy enrollment extension. The Republican ag platform includes a little dairy. Canada adjusts support prices higher, while the European Union plans additional dairy assistance. This and other dairy policy news can be found here.
Congressional ag leaders seek MPP-Dairy enrollment extension
Congressional agriculture leaders have asked the USDA to extend the Margin Protection Program for Dairy (MPP-Dairy) enrollment period to Dec. 31. The current deadline for 2017 MPP-Dairy participation is Sept. 30.
House Ag Committee ranking member Rep. Collin Peterson (D-Minn.) and Chairman Rep. K. Michael Conaway (R-Texas), along with Sen. Debbie Stabenow (D-Mich.), ranking member of the Senate Ag Committee, sought the extension in a letter to USDA secretary Tom Vilsack.
The lawmakers said the extension would allow farmers to make more informed decisions regarding income margin coverage and improve program participation.
“There are lessons to be learned with the implementation of new farm programs,” they said. “Producers rely on futures information and estimates of their own financial health to make educated decisions about how much coverage they should purchase. We believe extending the sign up period to Dec. 31 would provide more time for producers to assess the situation and maximize the sign up potential for MPP.”
NMPF supports Senate proposal to create biogas, nutrient recovery investment tax incentives
The National Milk Producers Federation (NMPF) endorsed Senate legislation designed to help dairy farmers increase investments in technologies to improve water and air quality and maximize the value of nutrients.
Senate Bill 3248, introduced by Sens. Sherrod Brown (D-Ohio) and Pat Roberts (R-Kan.) of the Senate Finance Committee, mirrors legislation introduced in the House of Representatives in June. Like the House bill, S. 3248 will modify Section 48 of the tax code to make biogas systems and nutrient recovery technologies eligible for an already-existing 30 percent investment tax credit to cover capital costs.
Republican platform calls for dairy policy reform
Delegates to the recently concluded Republican National Convention adopted an official 2016 platform, which includes a section on agriculture. According to the International Dairy Foods Association (IDFA), the platform includes a call for dairy policy reforms.
On page 17, under the section titled “America’s Natural Resources: Agriculture, Energy and the Environment," the platform states:
“We must also ensure that domestic policies do not compromise our global competitiveness through overregulation and undue interference in the marketplace. There is growing recognition that federal dairy policies, crafted during the Great Depression, are increasingly impediments to the ability of our dairy producers to meet the expected doubling in global demand coming by 2030.”
“Here’s yet another voice in the policy world calling for reform of the Federal Milk Marketing Order system,” said J. David Carlin, IDFA senior vice president of legislative affairs and economic policy. “We’re happy that the 2016 Republican Platform recognizes that current dairy policy undercuts U.S. global competitiveness and includes language that calls for reforming dairy pricing policies.”
National Sustainable Agriculture Coalition critical of GOP platform
The National Sustainable Agriculture Coalition (NSAC) was mostly critical of other planks in the Republican platform.
Of most concern to NSAC is a proposal that the Supplemental Nutrition Assistance Program (SNAP), a food assistance program serving more than 45 million Americans, be removed from the federal farm bill and USDA administration. Although perhaps not the intent of the proposal, the result of such a decision would not be the undoing of the SNAP program, but rather the end of the federal farm bill, NSAC said. Pulling nutrition out of the farm bill seriously harms the farm safety net and a host of other rural and agricultural programs, and sends the message that food and farm policy should be not be linked, breaking a connection between urban and rural Americans.
NSAC applauded platform recognition of a need for a fair and balanced crop insurance subsidy system; criticized as erroneous statements regarding the effects and scope of the U.S. Environmental Protection Agency’s Waters of the United States (WOTUS) rule; and criticized the platform’s opposition to labeling of foods produced with genetically modified ingredients and technology.
National Farmers Union forms ‘emergency’ dairy policy committee
The National Farmers Union (NFU), in conjunction with state Farmers Union divisions, has formed an emergency planning committee to address shortcomings in the current federal dairy program. Initially approved as a special order of business at NFU’s annual convention last March, the committee will work to build support for a stronger safety net and seek emergency assistance for U.S. dairy producers.
“If adequate support for dairy farmers is not provided, it will force thousands of family farms out of business,” said NFU President Roger Johnson.
Gillibrand to target policies impacting dairy in next farm bill
U.S. Sen. Kirsten Gillibrand (D-N.Y.) used a statewide agriculture listening tour to pledge efforts to work on policy reforms affecting dairy farmers in the next federal farm bill.
Gillibrand, a member of the Senate Ag Committee, said she will investigate Canadian barriers to U.S. dairy trade and seek changes to labor and immigration laws affecting the availability of agricultural labor.
Earlier in the month, Gillibrand sent a letter to USDA secretary Tom Vilsack, requesting more reimbursement money for dairy farmers under the Margin Protection Program for Dairy (MPP-Dairy).
International policies: Impacting dairy in the U.S.?
With international trade linking countries throughout the world, policies adopted in one country have the potential to impact dairy producers an ocean away.
European Union dairy aid package outlined
The European Commission (EC) released a dairy farmer support package that includes incentives to reduce milk production, allows European Union (EU) member states to provide aid specific to their producers, and extends the use of intervention stocks to keep surplus dairy products off the market.
The package, released July 18, is estimated to cost €500 million euros (about $553 million in U.S. dollars at current exchange rates). It contains three main elements:
• Incentives to voluntarily reduce milk production. Final details have not been released, but early reports indicate farmers would be paid a flat rate per liter of milk production reduction compared to the same period a year earlier.
• Conditional adjustment aid, defined and implemented at EU member state level. Member states will select the type of aid from a menu of options provided by the European Commission, and will be allowed to match EC funding with national funds, potentially doubling the level of support.
• A range of technical measures, including intervention and private storage aid for skim milk powder until February 2017.
Read the full Progressive Dairyman article.
Canadian producers to see 2.76 percent rise in industrial milk price
A Canadian Dairy Commission (CDC) announcement to increase support prices of butter and skim milk powder is expected to raise the price paid to Canadian dairy farmers for milk processed into dairy products by about $2 ($ Canadian) per hectoliter, or about 2.76 percent. The adjustments are effective Sept. 1, 2016.
Based on current exchange rates, the latest increase would equal about 67 cents per hundredweight ($ U.S.). (One hectoliter is equivalent to about 2.27 hundredweights. The current exchange rate is $1 Canadian to 76.5 cents U.S.)
The price for milk utilized in dairy products was raised about 2.2 percent in February 2016.
“These adjustments in support prices are meant to offset the significant reduction in producer revenues in the last year,” said Alistair Johnston, CDC chairman. “This revenue reduction has been partially compensated by a declining cost of production, which allowed us to limit the price adjustment.”
The price adjustment impacts milk processed into yogurt, ice cream, cheese and butter. Fluid milk prices received by producers are determined through a separate process.
The margin received by processors for butter and skim milk powder purchased by the CDC under the Domestic Seasonality Programs will remain unchanged, meaning all price increases will be passed along to the consumer.
The Dairy Farmers of Canada (DFC) said the CDC decision will help struggling dairy farmers. DFC said fewer than 30 percent of Canada’s dairy farmers are currently covering their cost of production. The price for industrial milk was increased about 2.2 percent in February 2016.
Canadian dairy producers, processors negotiate national ingredients strategy
In a separate announcement, the Dairy Farmers of Canada (DFC) said the country’s dairy producers and processors reached an agreement in principle during negotiations designed to move the Canadian dairy system into the future. The agreement includes the creation of a national strategy on dairy ingredients.
Negotiations between representatives of dairy farmer organizations and processors began in 2015.
DFC said specific details of the agreement would not be released until it is ratified by producer and processor organizations. Upon ratification, the anticipated implementation date is Sept. 1, 2016.
Earlier this year, Agropur Cooperative became the first Canadian dairy processor to halt use of imported ultrafiltered (also called diafiltered) milk from the U.S. under a temporary national program to encourage the use of Canadian milk in cheese manufacturing.
The targeted pricing program gives dairy processors access to Canadian “Class 4(m)” milk protein concentrates at reduced prices, effective May 1 through July 31, 2016. The temporary program does not ban ultrafiltered imports from the U.S. It does, however, make those products less economically competitive for use by Canadian processors.
Russia bans genetically engineered plants, animals
President Vladimir Putin signed a law banning cultivation of genetically engineered (GE) plants and breeding of GE animals in the Russian Federation. The law also strengthens state control and monitoring of processing and imports of GE organisms and products derived from such organisms, and sets financial penalties for violations, according to the USDA Foreign Agricultural Service Global Agricultural Information Network (GAIN).
Federal Law 358 does not ban imports of GE organisms and products (for food and feed use) if they are already registered for food and feed use in Russia. However, Russian controlling agencies may ban imports of products if they find a threat to the environment, people or animals, or if they determine that the imported product(s) are not registered in Russia.
The law does not ban imports of GE organisms for scientific research, although industry analysts indicate they believe research will cease because the scientific community will not be interested in conducting expensive research without prospects for commercialization. PD
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