For Immediate Release
(202) 224-5653

KOHL APPLAUDS ADMINISTRATION FOR WORK TO HELP DAIRY INDUSTRY

WASHINGTON – U.S. Senator Herb Kohl applauds Secretary Vilsack for his work to increase the Dairy Product Price Support Program (DPPSP). For August through October, the DPPSP will be adjusted in a way that will yield an estimated $243 million revenue increase for dairy producers. Farmers are struggling with milk prices that have fallen to historic lows while the costs of production – including feed, fertilizer, and fuel – have risen drastically. Kohl is an original author of the Milk Income Loss Contract (MILC) program and during the last Farm Bill debate fought to strengthen the program. Earlier this year, Kohl succeeded in including $585 million in loans to support farming and agriculture as part of the FY09 Supplemental Appropriations Bill. The bill included $360 million for direct farm ownership loans and $225 million for direct operating loans through the USDA's Farm Service Authority.    

"Wisconsin is home to more dairy farms than any other state in the Union. We produce 2.1 billion pounds of milk each month. About half the state's $51 billion agriculture economy is directly tied to dairy.  So when the diary sector hurts – Wisconsin hurts.  And I will say in no uncertain terms that the pain in dairy across America is very, very acute right now," Kohl said.  

From January though April of this year, the U.S. all-milk price has averaged $4.80 per hundredweight below the U.S. average cash cost of production. Earlier this week, Kohl and Sen. Russ Feingold called on Peter Orszag, Director of the Office of Management and Budget, to take action to protect the industry from instability.  They stressed the need for urgent intervention in the dairy sector and asked for increased support for producers through the Dairy Product Price Support Program.  

Kohl is Chairman of the Senate Agriculture Appropriations panel and has continued to work for the agriculture industry and local farmers by including farm credit provisions in the American Recovery and Reinvestment Act that Congress passed earlier this year.  He has pushed the Administration to fully implement programs like the Dairy Export Incentive Program to help offset low prices.   Kohl also fought to include the feed cost adjuster for the Milk Income Loss Contract (MILC) program in the 2008 Farm Bill.  

Please find the text of the remarks below:  

 

Mr. President, as we wait for members to come forward with amendments, I want to talk about something that's happening down at the USDA right now.  This morning, Secretary Vilsack is announcing changes to the Dairy Product Price Support Program.  I want to commend him for his diligence and persistence and willingness to keep pushing on this.

Wisconsin is home to more dairy farms than any other state in the Union. We produce 2.1 billion pounds of milk each month. About half the state's $51 billion agriculture economy is directly tied to dairy.  So when the diary sector hurts – Wisconsin hurts.  And I will say in no uncertain terms that the pain in dairy across America is very, very acute right now.

From January through April, the price of milk paid to dairy farmers has been about $4.80 per hundredweight below the cost of production.  Dairy producers have lost $3.9 billion in equity in 5 months. At risk is the long term stability of the industry, the nation's milk production infrastructure, and thousands of rural communities.

With Senator Leahy and a number of our colleagues, we have pushed to confront these challenges.  In the last farm bill we extended the basic safety net for dairy producers.  And we strengthened it with something called a 'feed cost adjuster.'  In the economic recovery bill we added credit to help producers survive.

At the same time the Secretary has worked to boost exports and provide more dairy products for nutrition programs.  All of these are critical steps.  Together they reflect – literally - a billion dollar effort to address a crisis that has hurt diary producers in every corner of the country.

But over the past several weeks, in hearings and letters --- and personal consultations that I've been a part of ---  there is a growing appreciation that more needs to be done.

Today the Secretary is taking the next step.  For August through October he is adjusting the Dairy Product Price Support Program in a way that will yield an estimated $243 million revenue increase for dairy producers.

I want to commend our Secretary of Agriculture for working with intensity and persistence.  And I want to commend our President for appointing a Secretary of Agriculture that works with intensity and persistence.  And I want to reassure dairy farmers all across America that, although we don't have all the answers, we are committed to pressing forward on their behalf.            

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