MILWAUKEE (AP) — Dairy farmers expressed frustration with
Congress’ failure to pass a farm bill, saying the uncertainty made it hard to do
business and some could go under without changes to the federal milk program.
Farmers also worried that if a current nine-month extension
of the 2008 farm bill expires with no action, a 64-year-old law will kick in,
sending milk prices spiraling. While that might provide short-term profits, they
said, it’d hurt them in the long run because no one wants to buy milk at $6 a
The U.S. House voted down a farm bill June 20, about a week
after the Senate approved a different version. It was the second year in a row
that the House failed to pass the every-five-years bill that sets funding for
agriculture and food programs.
Last year, it didn’t even vote, prompting the passage in
January of a slimmed-down extension of the 2008 law — largely to avoid milk
prices sharply increasing.
The Agricultural Act of 1949 sets a much higher price for
government purchases of cheese, butter and other dairy products than the U.S.
has seen in decades. The government cut the price in recent decades because if
it didn’t, more companies would sell to the government than to retailers, unless
consumer prices rose to match.
Farmers fear if the higher prices kick in on Jan. 1, milk
and other dairy prices will rise until consumers just stop buying their
“I don’t think that’s good for anybody because we would
destroy demand,” said Pete Kappelman, a Wisconsin dairy farmer and board
chairman of Land O’Lakes, a farmer-owned company that markets milk, eggs, butter
and many other products.
The farm bill failed in the House mainly because of
disagreement over food-stamp funding and dairy program reforms farmers say are
needed to keep them in business.
The government currently pays dairy farmers when milk prices
get too low. But the problem in recent years has been the high cost of feed due
to the ethanol industry’s demand for corn as well as the drought. Farmers say
milk costs almost as much to produce as they can sell it for — and sometimes
Kappelman, who has a 450-cow farm in Manitowoc, Wis., worked
on a national dairy industry committee that proposed a margin protection program
that pays farmers when the price difference between milk and feed shrinks to a
He also supports a market stabilization program that would
require farmers to either reduce the amount of milk produced when prices drop
too low or give up a portion of their margin protection payments. The U.S.
Department of Agriculture would then use that money to buy and donate dairy
products to food banks and help low-income families.
The margin protection and market stabilization programs
would be voluntary, but farmers couldn’t participate in one without the other.
The Senate passed a farm bill that included both the margin
protection and market stabilization programs, but House Republicans voted to
remove the market stabilization program. Minnesota Rep. Collin Peterson, the
senior Democrat on the House Agriculture Committee, said a number of Democrats
changed their vote to no at that point.
Randy Roecker, 40, was among those desperately hoping the
complete package would pass. He and his wife farm with his parents in
They were doing well in 2008, when they renovated to expand
from 50 to 300 cows. The next year, milk prices plummeted and feed prices rose.
At one point, they were losing $100,000 a month. Roecker
lost his savings, his parents lost their retirement and the farm went into debt.
They and many of their neighbors are still struggling, even
though milk prices have risen.
“Just last Friday, another one of my friends got rid of his
cows,” Roecker said. “It’s just getting to the point where you can’t afford to
keep going anymore.”
Wisconsin farmers grow more of their own feed than those in
states like California, the nation’s top milk producer.
Dean Strauss, 41, who milks 1,900 cows in Sheboygan Falls,
said growing 3,000 acres of feed provides some protection from high feed prices
but doesn’t reduce the need for a new farm bill, which would likely have better
crop insurance programs.
Strauss, who described himself as a “free-market” person,
was among the farmers who opposed the market stabilization program, fearing that
any reduction in milk production would stifle growth in the Wisconsin cheese
industry, which buys most of his milk.
Jamie Bledsoe, who has 1,300 cows in Riverdale, Calif., had
similar concerns about the effect on his state’s growing, international dairy
“My personal view is, the government does not effectively
manage anything, let alone the supply of milk,” Bledsoe said.
But Kappelman said that without a way to control supply when
milk prices fall too low, farmers would keep producing, the margins would stay
low and the government would have to keep shelling out.
Even with disagreement over the stabilization program,
farmers were united on the message they wanted to send to Congress. Failure to
pass a farm bill, Bledsoe said, “leaves us in a big cloud of uncertainty.”
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