Farm Crisis: “Without Immediate Government Action, The Days Of The Small Dairy Farm Are Numbered”

Paul Deaton May 3, 2018

Overproduction on factory farms has family dairy farms facing an existential crisis similar to that of the 1980s.

Things are bad when the coop sends the sui­cide hot­line num­ber with the milk payment.

Milk prices are cur­rent­ly about $15 per hun­dred pounds (cwt) while cost of pro­duc­tion at fam­i­ly farms is more than $22 per hun­dred­weight. Like so many seg­ments of agri­cul­ture, con­sol­i­da­tion is dri­ving down costs and small farm­ers are going out of business.

The Nation­al Fam­i­ly Farm Coali­tion (NFFC) believes the fed­er­al gov­ern­ment should do some­thing about it and has writ­ten a let­ter to con­gress and the USDA.

The nation’s dairy farm­ers are again in dire straits, just like we were in the 1980s,” Jim Good­man, Wis­con­sin dairy farmer and board pres­i­dent of Nation­al Fam­i­ly Farm Coali­tion said in a press release. Pro­posed safe­ty nets are total­ly inad­e­quate and with­out real long-term mar­ket reform, dairy farm­ers will con­tin­ue to lose their farms. Con­sumers who care where their milk comes from and pol­i­cy­mak­ers claim­ing to care about rur­al Amer­i­ca must sup­port these steps to ensure farm­ers a fair price. With­out imme­di­ate gov­ern­ment action, the days of the small dairy farm are numbered.”

A key com­po­nent of gov­ern­ment action would be to estab­lish a floor for milk pric­ing at $20 per hun­dred weight which would pro­vide imme­di­ate relief for farm­ers in debt and unable to pay bills.

Dairy farm­ers today are fac­ing no mon­ey, no hope, no way to plant spring crops or pay last year’s debts,” says Penn­syl­va­nia dairy farmer Bren­da Cochran. Noth­ing will stop the finan­cial hem­or­rhage we are fac­ing except a bet­ter farm milk price.”

Dairy farm­ers are com­ing full cir­cle, sort of.

In 1933, Con­gress passed the Agri­cul­tur­al Adjust­ment Act as part of Pres­i­dent Franklin Roosevelt’s New Deal. Among oth­er things, the AAA was designed to boost agri­cul­tur­al prices (includ­ing milk) by reduc­ing excess production.

Farm pro­grams in Amer­i­ca were orig­i­nal­ly cre­at­ed as a way to shrink the great moun­tain of grain, and for many years they helped to do just that,” explains jour­nal­ist and author Michael Pol­lan in an arti­cle for The New York Times Mag­a­zine. The Roo­sevelt admin­is­tra­tion estab­lished the nation’s first pro­gram of farm sup­port dur­ing the Depres­sion, though not, as many peo­ple seem to think, to feed a hun­gry nation…. but to help farm­ers reel­ing from a farm depres­sion caused by … col­laps­ing prices due to overproduction.”

Fast for­ward to Pres­i­dent Richard Nixon and his Sec­re­tary of Agri­cul­ture, Earl Butz, in the 1970s. Fac­ing polit­i­cal pres­sure due to high food prices, Nixon ordered Butz to do what­ev­er was nec­es­sary to dri­ve down the price of food.

Butz implored America’s farm­ers to plant their fields fence row to fence row,’” writes Pol­lan, and set about dis­man­tling 40 years of farm pol­i­cy designed to pre­vent overproduction.”

Food prices have not been high enough to engage con­sumers ever since. That brings us to today’s dairy crisis.

I have a hard time imag­in­ing how we can con­serve farm­ers with­out some kind of pro­duc­tion con­trols to curb the over­pro­duc­tion that caus­es the ag mar­kets to crash,” dairy farmer Fran­cis Thicke wrote on the Prac­ti­cal Farm­ers of Iowa list serve. Are Amer­i­can farm­ers even open to con­sid­er­ing pro­duc­tion controls?”

The Nation­al Fam­i­ly Farm Coali­tion believes they must be and out­lined aspects of a gov­ern­ment pro­gram to ease over­sup­ply. These include:

  • Set­ting an imme­di­ate floor price of $20/​cwt for milk used to man­u­fac­ture dairy products;
  • Estab­lish­ing a milk prod­uct pur­chas­ing ini­tia­tive by uti­liz­ing U.S. Depart­ment of Agriculture’s author­i­ty under 7 USCS Sec­tion 612c, com­mon­ly referred to as Sec­tion 32 sur­plus removal;
  • Plac­ing an imme­di­ate mora­to­ri­um on Envi­ron­men­tal Qual­i­ty Incen­tives Pro­gram (EQIP) fund­ing and direct and guar­an­teed loans for con­cen­trat­ed ani­mal feed­ing oper­a­tions (CAFOs);
  • Hold­ing hear­ings on the milk pric­ing for­mu­la and the dairy crisis;
  • Imple­ment­ing a sup­ply man­age­ment pro­gram as out­lined in the pro­posed Fed­er­al Milk Mar­ket­ing Improve­ment Act of 2011 to sta­bi­lize milk production.

It’s clear from watch­ing the Repub­li­can con­trolled fed­er­al gov­ern­ment that small dairy farm­ers are on their own. It’s hard for con­sumers to react when the price of cheese and oth­er dairy prod­ucts is down and milk sells for less than $2 per gal­lon. In this sce­nario, something’s got to give. Unless the fed­er­al gov­ern­ment steps in with pro­duc­tion con­trols, it will be fam­i­ly dairy farmers.

(There Is A Fam­i­ly Dairy Farm Cri­sis” was first pub­lished on Blog for Iowa” and is repost­ed on Rur­al Amer­i­ca In These Times with per­mis­sion from the edi­tor. To read the NFFC’s let­ter to Con­gress and the USDA in its entire­ty, please click here.)

Paul Deaton writes about food, cli­mate change, ener­gy pol­i­cy and pro­gres­sive pol­i­tics for Blog for Iowa. Democ­ra­cy for Iowa, the orga­ni­za­tion that over­sees the blog, is a pro­gres­sive polit­i­cal action grass­roots orga­ni­za­tion that seeks to elect social­ly pro­gres­sive and fis­cal­ly respon­si­ble can­di­dates to statewide and local offices in Iowa.”
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