Sharp dairy downturn prompts action

Vermont Secretary of Agriculture Roger Allbee, in collaboration with New York Agriculture Commissioner Pat Hooker and Pennsylvania Agriculture Commissioner Dennis Wolff, sent an urgent letter to USDA Secretary Tom Vilsack last week. In the letter, the officials requested that Vilsack immediately implement Section 1509 of the Food, Conservation and Energy Act of 2008.

This act calls for the establishment of a Federal Milk Marketing Order Review Commission. This action is in response to the downturn dairy farmers are facing that could be detrimental to the dairy industry in Vermont, the Northeast and the nation. Due to a complicated and antiquated milk pricing structure, one state acting alone can do very little to address the volatility of milk pricing.

"There have been many studies of the U.S. dairy industry in the past, but few have resulted in any specific steps to address the issues that today place all dairy industry stakeholders in an extremely difficult financial situation," said Secretary Allbee. "The current demand and supply imbalance in the domestic dairy industry presents an imminent threat to the economic stability and welfare of dairy farmers, allied industries and the overall U.S. economy."

The dairy industry, like many others, has a history of responding to crisis. The severity of this crisis, as identified by dairy economists worldwide, requires a response like no other. Hence the call from the Northeast agriculture officials for an immediate, independent and rigorous analysis to be conducted of the economic benefit of Federal Marketing Orders and other federal programs related to the dairy industry.

"In this letter we suggested to Mr. Vilsack that the focus should be to determine how milk supply and demand can be better balanced without subjecting farmers and others to the wide price swings of recent times" said Allbee. "We also requested that this analysis be conducted as quickly as possible in order to have policies and other methods in place to better mitigate this and future price collapses."

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