CHENANGO COUNTY – A fair price for milk shouldn’t be regulated by Washington, one local dairy producer says – it should come from the market.
“We don’t need to be paid out of taxpayers’ pockets,” said South New Berlin farmer Ken Dibbell. “We need to get paid by the market.”
At $18.86 per hundredweight, federally regulated milk prices for July 2007 will be nearly double what they were a year ago, according to the U.S. Department of Agriculture, but the cost of production – steadily hovering around $24 per hundredweight for the last five months – is still outstripping any returns local farms receive.
“Three words – cost of production. They ignore it. It’s right in front of them. If we don’t fix it, there won’t be any small farms left in five years,” said Dibbell. “That’s my prediction.”
Dibbell said Washington should gather consumer’s thoughts when designing dairy policy in the upcoming U.S. Farm Bill debate, and ultimately let market forces decide what farmers get paid, not big cooperatives and big farm interests.
In a joint letter sent by Gov. Eliot Spitzer and his counterparts in California, Florida and Texas yesterday, the “big four” asked Congress to act on important issues facing agricultural economies in the nation’s four most populous states when re-authorizing the 2007 Farm Bill.
“Together we represent a substantial segment of the nation’s agricultural economy,” said Spitzer in a written statement. “As our leaders in Washington consider the 2007 Farm Bill, we have joined together to speak with one voice on a critical issue that affects the jobs and lives of our citizens.”
The four governors’ six-part platform did not specifically outline any initiatives to improve the dairy industry.
The Farm Bill expires Sept. 30. Legislative negotiations have already begun.
Senator Charles Schumer, like several New York politicians, is pushing for the reinstatement of the Milk Income Loss Contract. The contract pays farmers an adjusted rate when the Class I milk price falls below $16.94 per hundredweight for up to 2.4 million pounds of the milk they produce. Schumer hopes the Farm Bill will extend the program, which also expires Sept. 30, and double the production cap from 2.4 to 4.8 million.
Norwich dairy farmer Alynn Proskine sees the MILC program as a kind gesture rather than a sound solution.
“One third of that money goes toward administrative fees and never ends up where it is supposed to go,” said Proskine. “It helps, but it’s not really fixing the problem.”
Proskine says the hot and dry spell hitting the county has done more lately for dairy farmers than government programs have.
“The cows aren’t milking as good and the supply goes down and drives the price up,” he said. “Mother Nature can do more for the milk industry.”
However, Proskine said when the supply goes down, farmers counteract the price increase by purchasing more cows.
“When the price goes up, they buy more cows to get more milk,” he explained. “There’s too much milk. They should limit the supply and keep the price up. We shoot ourselves in the foot and wonder why it hurts.”
According to New York State Agriculture and Markets, New York dairy farms contribute more than $1.9 billion each year to the state’s economy. For every new job created on a dairy farm, an additional 1.24 jobs are created in the local economy and an additional $ .83 is spent in the community for every dollar of output on a dairy farm. There are currently 6,000 dairy farms in the state.