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Ag Secretary Vilsack milked for answers

Ag Secretary Vilsack milked for answers

U.S. Secretary of Agriculture Tom Vilsack addresses a capacity crowd at the Stanislaus County Agriculture Center on Wednesday.


POSTED August 29, 2009 9:14 a.m.
The Stanislaus County Ag Center filled with red-clad dairymen and women on Wednesday to welcome U.S. Secretary of Agriculture Tom Vilsack to town -– and to implore the Secretary to do something to stem the losses that threaten to put 10 percent of California dairies out of business by the end of the year.
The sea of red was intended to represent the red ink California dairies are bleeding. For every 500 cows, a dairy will lose approximately $50,000 per month as a result of the recent collapse in milk prices, according to the California Dairy Women.
A concerned crowd of more than 600 farmers turned out for what will be Vilsack’s only stop in California during his Rural Tour of town hall meetings in the nation’s farmlands. Both the main room and an overflow room at the Ag Center were full to capacity.
“This (turnout) shows all of us how important ag is to the Central Valley and how important the issues you’ve come to talk about today are,” said U.S. Rep. Dennis Cardoza (D- CA18), who sits on the House Agriculture Committee and lobbied for Vilsack’s visit.
While the issues of immigration reform, water, and new cap and trade regulations came up throughout the course of the hour-plus long public forum, the recurring theme was undoubtedly that of dairy, a $689 million industry in Stanislaus County.
Vilsack explained the efforts taken so far to secure the price of milk, which has dropped more than 50 percent in a year’s time. The support price paid by the government for dairy products that could not otherwise be sold on the open market was recently raised for the first time in almost three decades. Additionally, bankers are being persuaded to assist farmers with loans, and school nutrition programs are being urged to purchase milk, but producers say more needs to be done.
“I’d like to thank you for all you’ve done so far, but it isn’t enough,” said Linda Lopes, president of the California Dairy Women.
Vilsack outlined the ongoing efforts of the U.S. Department of Agriculture to create internal and external advisory groups to research and brainstorm what needs to be done to create long-term price stability in the market. He said that, once the industry can decide upon what needs to be done, the USDA can move forward with a plan.
“We don’t have time to do that,” said Ray Souza, president of the Western United Dairymen and owner of Turlock’s Mel-Delin Dairy. “We need something now.”
California dairies have already lost $2 to $3.5 billion in the value of their herds.
Souza suggested an immediate government purchase of 100 million pounds of cheese to replenish food banks running low on supplies. He said such a move would clear inventory and stabilize prices, while also helping the poor.
Other farmers, who reiterated that they need help and they need it right away, requested the stabilizing effect of a further increase in the dairy support purchase price, guaranteed for a longer period of time. Another dairyman suggested a supply management program, “So we can get a price for our milk.”
Unfortunately for local dairymen, the U.S. Congress is out of session until Sept. 8 and cannot begin to draft new legislation until that time. Compounding the problem, the USDA currently is out of purchasing authority, and lacks funding for any new programs until the new fiscal year begins on Oct. 1.
Vilsack said the USDA must contend with the PAYGO rule even if they do move forward with providing increased dairy support. As the USDA budget has already been drafted, funding dairy programs would require pulling funds from other areas, perhaps cutting from programs for pork producers or corn farmers.
“It’s not a simple thing to do what you want me to do,” Vilsack said. “I want to do it. I want to help.”
Vilsack, who served eight years as Governor of Iowa and ran for the Democratic presidential nomination in 2004, said he made an effort to make the Modesto stop of his Rural Tour notable, so as to reflect his department’s dedication to the region and the plight of dairymen. Wednesday represented the first time on the tour that both Vilsack and U.S. Deputy Secretary of Agriculture Kathleen Merrigan were in the same location.
As Vilsack started out as a small town lawyer in Iowa during the 1980s ag crisis, he said he was intimately familiar with what dairymen were going through and was committed to, “allowing folks to stay on the farm and prosper on the farm.” He also noted the importance of the San Joaquin Valley as the world’s most productive agricultural region, growing $32 billion worth of more than 350 crops and producing more than half of the nation’s fruits, vegetables, and nuts.
Also making the trip to Modesto for Vilsack’s visit were California Secretary of Agriculture A.G. Kawamura, Turlock Mayor John Lazar, and County Supervisors Jeff Grover, Vito Chiesa and Jim DeMartini.
“We have not done as much as folks want at the end of the day, but no one in this room can say we’ve done nothing,” Vilsack said.
After Vilsack left the room, redshirted dairymen said they believed the meeting was successful — even if the majority of the questions asked came from VIP guests who were seated in the front rows.
“In the beginning I thought they were getting picked and choosed, what questions were getting asked,” said dairyman David Alves.
Toward the end of the meeting more questions were taken from those in red, in part due to the fact that some dairy farmers refused to wait to be called on and started calling out questions.
Several impassioned dairymen made a point to ask why there isn’t a closer correlation between the market and retail prices of milk. Only recently did the price of milk in stores drop 9 percent, despite 50 percent drops in the value of milk to producers.
Vilsack stated that the Department of Justice would soon hold a series of public hearings on dairy superpowers Dean Foods and Kraft Foods to investigate possible price fixing. Dean Foods saw first quarter profits more than double from $30 million in 2008 to $76.2 million in 2009.
“They’re making record profits and we’re dying,” said dairyman Bob Borba.
In the early 1980s, producers earned 50 cents of every dollar spent at retail. Now, that share is closer to 22 cents on the dollar.
“What they (The USDA) don’t understand is that we just want our fair share of the existing price,” said dairyman Gary Genske.
To contact Alex Cantatore, e-mail acantatore@turlockjournal.com or call 634-9141 ext. 2005.

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