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Strain pleased USDA helping dairy farmers

August 3, 2009

Agriculture and Forestry Commissioner Mike Strain, D.V.M., said he is very pleased the United States Department of Agriculture (USDA) is taking immediate action to support struggling dairy farmers.
“I met personally with Agriculture Secretary Tom Vilsack on July 20 at a town hall-style meeting in Reserve and discussed the plight of Louisiana’s dairy farmers with him,” Strain said. “I am gratified that the USDA has heard the voice of American dairymen and increasing the amount paid for dairy products through the Dairy Product Price Support Program (DPPSP).
“Part of our conversation included a discussion of the establishment of regular dairy compacts across the U.S. and the need for the cost of production to be adequately calculated when setting the base milk price via the federal milk marketing orders.”
The USDA estimates show that the increases, which will be in place from August 2009 through October 2009, will increase dairy farmers’ revenue by $243 million, Strain said.

Louisiana dairy farmers said the support will help their bottom line.

“Anything, really, will be an upswing for the Louisiana dairy farmer,” said St. Helena Parish dairyman Eugene Robertson.

Robertson is the chairman of the Farm Bureau Federation Dairy Advisory Committee. Robertson was also present at the July 20 town hall meeting with Vilsack and posed several tough questions to the Secretary.

“The dairy farmers have put forth a lot of effort to get the administration to recognize the issues in dairy farming,” Robertson said. “It’s only for three months but we expect to see an increase of $0.75 to $1 per hundred weight.”

The increase will raise the price paid for nonfat dry milk from $0.80 per pound to $0.92 per pound, the price paid for cheddar blocks from $1.13 per pound to $1.31 per pound, and the price of cheddar barrels from $1.10 per pound to $1.28 per pound. This increase in the support price will have an immediate effect upon dairy farmers’ bottom line. Temporarily raising the price of these dairy products increases the price that dairy farmers receive for their milk.

USDA estimates that the policy change is expected to increase all milk prices received by dairy producers. The increase will result in the government purchase of an additional 150 million pounds of non-fat dry milk (NDM) and an additional 75 million pounds of cheese.

Robertson said problems of oversupply remain a serious issue in the dairy market and it’s difficult for Louisiana producers to compete, at least during the hot summer months.

“We can compete when our cows do well from November to April but not as well in the hot summer months,” Robertson said. “We feel a lot of pressure from larger dairy states in the summer and oversupply becomes an issue.”

"The LDAF has been pursuing all options to help dairy producers," said Strain. "This price increase will bring some much needed relief to dairy farmers in Louisiana and will help keep them in the dairy business.”

Robertson said the Louisiana dairy industry has been in a slow decline for more than four decades.

“When I was a young man there were more than 100 dairies just in St. Helena Parish,” Robertson said. “Today, there are only 180 in the entire state.”

Strain said the USDA is currently reviewing federal dairy policy to determine what changes are needed to reduce price volatility and enhance farmer profitability.

Strain urged state consumers to support Louisiana dairymen and buy milk and other dairy products that are produced from local sources.

“There are a number of Louisiana dairies that are marketing their own milk and dairy products in the grocery stores,” Strain said. “Dairy products are natural and very healthy.”