The Turlock-based California Farmers Union and the California Dairy Campaign have come out against the Dairy Security Act of 2011 (H.R. 3062). CDC President Joe Augusto and CFU President Joaquin Contente have been urging lawmakers to oppose the Dairy Security Act. The Dairy Security Act was brought forward by Collin Peterson (D-MN), and Mike Simpson, (R-Idaho) under the belief that the DSA would reduce dairy subsidies by $131 over 10 years.
Supporters of the DCA are believed to be pushing for submission of the act to the Joint Select Committee on Deficit Reduction. The fast track route of the DCA has made the CFU and the CDC nervous, prompting a study from the University of Wisconsin’s Dr. Mark Stephenson.
Under the DSA two safety net programs — the Milk Income Loss Contract Program and the Dairy Support Purchase Program — would both be eliminated and replaced with a Dairy Producer Margin Protection Program. The margin is the amount of money between the price a producer’s milk sells for and the cost of the feed needed for the cows. Producers who have less than a $4 margin per hundredweight of milk sold for two consecutive months would receive taxpayer funded payments. Under the margin program there is no defined cap to spending.
“Proponents of the DSA claimed all along that it would improve dairy producer prices and this new study confirms just the opposite,” state Augusto. “As proponents of the DSA are attempting to fast passage of the bill through the super committee in Congress, it is critical that dairy producers speak out in opposition. This legislation would eliminate the current dairy safety net, fuel forward contracting of milk sales which will lead to even greater consolidation and concentration than exists today harming both producers and consumers of milk and dairy products,” he concluded.
“The study released this week is yet further proof that the DSA would cause more dairy producers to go out of business,” stated Contente. “The DSA would lower prices by up to $1.60 per hundredweight and shift even more risk to dairy producers,” he explained.
The CDC and CFU say the DSA would eliminate the current dairy safety net and replace it with an insurance program, deregulate cheese prices and vastly expand forward contracting of milk sales.
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