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CDFA gives dairy farmers a much-needed boost

CDFA gives dairy farmers a much-needed boost

While the 3-cents-a-gallon raise for fluid milk should help out struggling dairy farmers, it is unlikely to have an effect on consumers at the retail level, according to the CDFA.


POSTED December 24, 2009 2:13 p.m.
California dairy farmers got an early Christmas present from the state’s Department of Food and Agriculture with a temporary increase in milk prices.
The California Department of Food and Agriculture decided to raise the minimum price of milk for three months, giving struggling dairy farmers a temporary boost during a global recession that has devastated many farmers.
The  CDFA is increasing the minimum prices of all milk usage by varying amounts for a temporary three-month basis from January through March 2010. The price increase includes a 3-cents-a-gallon raise for fluid milk products. The temporary adjustments on other dairy product classifications will cost less than one cent per container in production costs, but are unlikely to have an effect on consumers at the retail level, according to the CDFA.
The decision to change the state’s milk pricing came about after an emergency hearing in November, in which the department heard from hard hit dairy farmers and producers.
Dairy farmers in California have been hit hard by the global economic meltdown, coupled with a sizable reduction in consumption of milk and dairy products. In 2009 the prices that dairy farmers receive plummeted, dropping by over half the level they were in 2008, according to the CDFA. Dairy feed costs have kept milk production costs at levels that greatly exceeded farm milk prices. As a consequence, California dairy farmers lost an estimated $1.4 billion dollars in the first nine months of 2009.
In a reversal of a 30-year trend, California’s milk production dropped in 2009, down 4 percent from 2008. Additionally, a growing number of dairy farmers have made the decision to quit the industry in 2008 and 2009. For the first time in decades, the state’s milk production will be less than the total needs of its processing plants.
The temporary price increase will help, but farmers say it falls short of a lasting solution. In a statement released by the CDFA, the department said that “while the temporary price adjustment is not designed to recover the financial losses that California dairy farmers incurred over the past twelve months, it is designed to help dairy farmers sustain their operations as milk prices begin to return to near profitability.”
To contact Sabra Stafford, e-mail sstafford@turlockjournal.com or call 634-9141 ext. 2002.

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