WASHINGTON, D.C. – Today, U.S. Senators Susan Collins and Angus King joined a bipartisan coalition of their colleagues in both the Senate and House to send a letter to U.S. Department of Agriculture (USDA) Secretary Tom Vilsack asking for assistance for dairy producers struggling with declining milk prices. Specifically, the lawmakers asked the USDA to use its existing authorities to expand and maintain U.S. domestic markets, encourage the domestic consumption of dairy products, and help dairy farmers through this financial crisis.
“We are deeply concerned that U.S. dairy farmers, who are a key part of our agriculture community and agriculture economy, are in greater need of stability and support as they face these significantly lower prices,” Senators Collins and King and their colleagues wrote. “We encourage USDA to take any and all actions available in order to make an immediate market injection and offer financial assistance that will directly support U.S. dairy farmers equally.”
Farm milk prices have dropped 40 percent since 2014 due to multiple events – from an increase in U.S. production levels, to changes in the European Union’s regulation of milk production, to a drop in the export market. In vastly different dairy market regions of the United States, farmers are facing similar margin shortfalls while still adjusting to changes in federal dairy support programs from the 2014 Farm Bill.
The complete text of the letter can be read HERE and is below:
July 28, 2016
The Honorable Tom Vilsack
Secretary of Agriculture
1400 Independence Avenue, S.W.
Washington, D.C. 20250
Dear Secretary Vilsack:
We write today to express our concern about the troubling economic challenges facing U.S. dairy farmers and the entire U.S. dairy industry. We have seen farm milk prices drop forty percent since 2014 and in May the nation’s cheese stocks were recorded at their highest level since the data was first recorded in 1917. Current expectations are that the dairy market will continue to struggle with depressed prices and we seek your help as we search for ways to swiftly assist our nation’s struggling dairy farmers.
Our dairy farmers have been hit extremely hard by low farm milk prices that have resulted in sharply reduced incomes, which is placing our nation’s dairy industry in an extremely vulnerable position. A number of factors have contributed to this crisis. U.S. milk production has increased almost two percent above last year’s level, while global milk production is up significantly, partly as a result of the European Union’s decision to remove its milk production quotas and the loss of their export market to Russia. Furthermore, we are seeing an increase in production in other major milk-producing countries that have led to these depressed prices globally. All of this comes as our dairy farmers are still adjusting to the new Farm Bill, and the many changes that were made to our dairy support programs.
We are deeply concerned that U.S. dairy farmers, who are a key part of our agriculture community and agriculture economy, are in greater need of stability and support as they face these significantly lower prices, which for many are below their actual cost of production. As this industry is reeling from low prices, a glut of imports, challenges in our export markets, and poor economic growth projections we urge the USDA to use its secretarial authority under the Commodity Credit Corporation Charter Act (15 U.S.C. 714c), Section 32 of the Agricultural Adjustment Act of 1935 (7 U.S.C. 612c), and look to past precedent for how to take action to protect all of our nation’s dairy farmers from further crisis and to aid in the expansion and maintenance of domestic markets. We encourage USDA to take any and all actions available in order to make an immediate market injection and offer financial assistance that will directly support U.S. dairy farmers equally, while being cautious to not stimulate overproduction further.
The family business of dairy farming has long been woven into our nation’s agricultural history. Across the country, in all 50 states, dairy farms large and small are economic drivers providing local jobs and local products. During the 2009 dairy collapse, we saw far too many families have to sell off their cows and close the doors for good. Through the support of USDA, we can hopefully prevent many farms from needing to make that same difficult decision today and we hope you will work to support all of our dairy farmers across the country.
We look forward to working closely with you in determining the best course of action to take in managing the current dairy industry financial crisis. Thank you for taking the time to address this important matter.