The Hagstrom Report

Agriculture News As It Happens

Farmers Union objects to Peterson-Simpson dairy act

The proposed Dairy Security Act introduced by House Agriculture Committee ranking member Collin Peterson, D-Minn., and Rep. Mike Simpson, R-Idaho, would lead to further vertical integration of the dairy industry and should be revised to include a program that would help small dairy producers, the National Farmers Union said late last week.
Roger Johnson
Roger Johnson, National Farmers Union
“The DSA, in its most recent form, will likely encourage the use of forward contracts,” NFU President Roger Johnson said in a Friday letter to agriculture committee leaders.

“For many years, NFU has opposed the increased use of forward contracting for dairy producers,” Johnson said. “Similar to the consolidation and vertical integration that has occurred in the poultry and swine sectors, the DSA could lead to increased forward contracting by dairy processors will only serve to transform the American dairy industry at a heavy cost to farmers and rural communities.”

The DSA currently has no program for farmers who opt out of the insurance program, which would likely lead to further vertical integration of the dairy industry, Johnson noted.

“Without a program that will help smaller dairy producers, the use of forward contracting should be prohibited in order to prevent the consolidation and vertical integration of the dairy industry,” said Johnson.

“The DSA must include a program that could provide protection to dairy farmers if prices fall too low. This is especially helpful for family dairies, to ensure that they are able to continue producing during difficult times.”

The National Milk Producers Federation, the largest organization of dairy farmers and co-ops favors the legislation, but the International Dairy Foods Association, which represents processors, opposes it.

Meanwhile, the Dairy Business Association has released three analyses of the Dairy Security Act. Links below

Analysis of the Dairy Security Act and the Dairy Provisions of the Rural Economic Farm and Ranch Sustainability and Hunger Act