WASHINGTON, DC – Senator Charles Schumer introduced legislation Wednesday aimed at closing the “gaping loophole in federal trade law” which he said has allowed foreign milk protein concentrates to flood the US market and undercut the domestic dairy industry while driving down the farm price for milk and costing New York’s dairy farmers millions of dollars a year.
“This is one of the worst times for our dairy farmers,” Schumer said, as he spoke of the challenges New Yorks 5,800 farm families are facing while milk prices are lower than the cost of production.
With the Milk Import Tariff Equity Act, the senator said he seeks to correct what he called a “major mistake” when the U.S. last set its tariff and quota schedule during the seven year negotiation of the World Trade Organization’s Uraguay Round Agreement on Agriculture. MPCs, which were not widely used in food production at the time, were not included in the list of dairy and dairy-derived products covered by the agreement, which took effect in 1995.
Foreign producers are attempting to further exploit this loophole and “skirt existing tariffs” by adding trace amounts of MPCs to other dairy products, Schumer said.
Citing statistics provided by the National Milk Producers Federation, the senator reported that 27,800 metric tons of MPCs were imported into the U.S. between 2004 and 2007, an amount valued at $108.7 million.
With the legislation he has proposed, domestic dairy farmers would be able to increase their share of the market, he said. He estimated that this could mean more than $7 million a year in additional revenue for New York dairy farmers.
Both Schumer and industry advocates recognize that MPC imports only represent a part of the problem for the dairy industry. Other steps still need to be taken in order to stabilize the industry, particularly in the short-term to ensure that farms are able to stay in business while they wait for the tide to turn.
“Farm Bureau has always supported the establishment of a non-tariff rate quote on MPC imports (milk protein concentrates or caseins),” explained Chenango County Farm Bureau President Bradd Vickers, “(But) MPC imports are not the answer to the current crisis.”
 The real solution, Vickers said, “is to establish a system that allows for better regionalism in determining farm gate prices for fluid milk, such as the former Northeast Dairy Compact. That would help both consumers and farmers, by assuring regional consumers that there will always be a stable number of farms producing high quality, fresh milk, and keeping land open, and helping farmers by providing a more stable milk price.”