WASHINGTON, D.C. – U.S. Senator Charles E. Schumer warned that the deadline is fast-approaching for the House of Representatives to take action and pass the bipartisan Senate Farm Bill, in order to avoid the “dairy cliff,” which he said would have “a devastating impact on dairy consumers and producers alike.”
Schumer called on the House to take action before year’s end, in order to avoid the potential for consumers’ milk prices to double across New York and to temporarily bring back the Milk Income Loss Contract (MILC) program for over 5,400 dairy farms in Upstate New York. Passing the Farm Bill would also bridge the gap before a new margin protection program can be rolled out, he said.
MILC, which provided over $41 million to New York dairy farmers in 2012 before it expired on September 30th, was the primary safety net that compensated dairy producers when milk prices fluctuated and cow feed costs jumped, as they have due to this year’s drought.
The 2008 Farm Bill expired on Sept. 30, and on Jan. 1 the nation will begin to revert to 1940s era agriculture policy. As it relates to New York dairy, that 1940s era policy requires the government to purchase nonfat dry milk, cheese and butter at prices significantly above current market rates. The massive government purchases of dairy products under this outdated law could cause milk prices to rise above $6 per gallon, according to the National Milk Producers Federation (NMPF).
“The ‘dairy cliff’ is fast approaching, and without a House Farm Bill before year’s end, it will be consumers and dairy producers alike that go over the edge,” said Schumer. “On January 1st, families across Upstate New York could start to see over a hundred-percent increase in the price of milk at the supermarket, all while dairy farmers would lose important assistance from the feds that helps combat an unstable market and devastatingly high feed prices. What’s worse, is that this is an entirely avoidable and unnecessary burden on families, schools and farmers alike, and it could be easily addressed. All the leaders of the House of Representatives must do is put the bipartisan Senate Farm Bill on the floor for a vote, and I’m sure that it will pass.”
Schumer continued, “It is unacceptable to have allowed the Farm Bill to expire in September. Now, time is ticking and the House must pass the Senate Farm bill so we can all avoid crying over spilled milk.”
“As we approach the final days to get the 2012 Farm Bill passed, the anxiety is growing for farmers who have already had the safety net pulled out from under them with the loss of the MILC program,” said New York Farm Bureau President Dean Norton. “Now, they’re facing the bottom falling out of the dairy market with prices expected to double if farm policy reverts back to the 1940s. It’s a price few consumers would be willing or capable of paying, potentially upsetting the delicate supply and demand of milk. We urge other lawmakers to follow Senator Schumer’s lead and get a Farm Bill passed, not only for the hard working farm families of New York, but for all families who depend on putting healthy food on their dinner tables.”
In the Southern Tier, he estimated that not passing the bill would result in the price of a gallon of milk rising to $2.22 in the Binghamton area.
The dairy industry is New York’s largest contributor to the agricultural economy and in 2009, generated $1.7 billion. According to the New York State Department of Agriculture and Markets Dairy statistics, there are 5,400 dairy farms in New York and New York ranks first in cottage cheese production and third in mozzarella and cheddar cheese production. One-third of New York’s milk production is for drinking and two-thirds is for processed dairy products such as Greek yogurt and ice cream.