As Vermont dairy farmers struggle to survive, Welch seeks to increase and index to inflation MILC payments

Rep. Peter Welch on Thursday introduced legislation that would index to inflation Milk Income Loss Contract (MILC) Program payments to dairy farmers.

The Dairy Fairness Act of 2009, which is co-sponsored by eight Members of Congress, would amend the Farm Bill to tie MILC payments to the Consumer Price Index, thereby increasing payments to farmers each year. Sen. Kirsten Gillibrand (N.Y.) is introducing companion legislation in the Senate.

"We are in the midst of a dairy crisis like Vermont has never seen. Throughout the state and throughout the Northeast, dairy farmers are struggling to hang on as the disparity between the price of milk and the cost of production shows no sign of easing," Welch said. "While this legislation faces an uphill battle in Congress, I will continue to do everything I can to raise awareness about this devastating situation and educate my colleagues about the importance of saving our prized Vermont dairy industry."

Also, earlier this week Welch fought to amend the agriculture appropriations bill to increase the overall MILC payment rate. Currently, farmers receive 45 percent of the difference between the price of milk and the target price of $16.94 per hundredweight. Under the Welch amendment, which was co-sponsored by six Members of Congress, farmers would receive 79 percent of the difference between the price of milk and the target price. The amendment was not accepted by the House Rules Committee.

Welch's legislation comes during one of the greatest crises Vermont's dairy industry has faced. These legislative efforts are intended as short-term fixes to the problem as farmers work together to find long-term remedies to volatility in the milk market.

"I have been farming for 31 years and have never had to borrow money to balance the check book. I am now," said Bryan Davis, a Derby Line farmer who attended a breakfast meeting Welch held with Franklin County farmers Tuesday. "The price I am receiving for my milk does not cover the cost of production. I am losing money every day. We need serious help soon - before the bank closes the door."

Recognizing the growing difficulties faced by dairy farmers, the Secretaries of Agriculture from eleven Northeastern states wrote Congress earlier this year advocating an increase in MILC payments from 45 to 79 percent. The St. Albans Cooperative Creamery also wrote President Obama earlier this year requesting the same increase.

Vermont Secretary of Agriculture Roger Albee said, "Our dairy farmers are important contributors to our economy, rural communities, landscape and way of life.  Unfortunately, they are victims of an antiquated and broken pricing system that is putting their livelihoods at risk. It's important that they know that work is being done for the short and long term to help them during this unprecedented time of financial stress. I appreciate Congressman Welch's efforts and fully support his proposal. It will help to bring some immediate relief, not only to struggling dairy farmers in Vermont, but across the nation as well." 

Welch raised the growing plight of dairy farmers on the House floor Wednesday night with Reps. Rosa DeLauro (Conn.) and Joe Courtney (Conn.). Click here to view the exchange.