Colorado delegation pushes to help hard-pressed dairy farmers

Colorado’s U.S. senators, Michael Bennet and Mark Udall, sent a letter Thursday asking leaders in both the House and Senate to keep $350 million for dairy farmers in the conference version of the Agriculture Appropriations Act. The money was approved last month in the Senate version of the bill.

“We still have an opportunity to get this lifeline in the final version of the bill, and I urge my colleagues to include it, Senator Udall was quoted as saying in a press release about the letter.

The letter comes on the heels of the announcement that six Colorado dairy farms have filed for Chapter 11 bankruptcy this year, with more expected to follow.

Observers blame the tough times on two factors: the fact that milk commodity prices are at their lowest level since the 1970s and the collapse of New Frontier Bank in Greeley. The bank’s closure in April cut credit lines for many dairy farmers, just as prices plummeted. And farmers still don’t whether the new owners of the New Frontier loans—75 percent of which are in arrears— will be willing to restructure.

But already, groups like Americans for Tax Reform are questioning the proposed funding. A September 21 article by Sandra Fabry refers to the additional funding as a “bailout for dairy farmers:”

Not only are these types of subsidies counterproductive, as they send the wrong signals to dairy farmers to produce more milk when there’s already too much of it, they also come with a massive price tag.

The funding supported by the senators’ letter would allow the U.S. Department of Agriculture to raise the support price for nonfat dry milk from $.92 per pound to $.97 per pound. If approved, the new funding would be in addition to another recent increase. At the end of July, Agriculture Secretary Tom Vilsack announced a three-month temporary increase in the support price of dairy products. At that time, nonfat dry milk went from $.80 per pound to $.92 per pound. Don’t understand what a “support price” is? Here is an explanation of the program from the National Milk Producers Federation:

Under the Dairy Product Price Support Program, the USDA serves as a buyer of last resort to help clear commodity dairy markets during periods of exceptionally low farm-level prices.

Though Fourth District Congresswoman Betsy Markey did not sign the letter, she was included in the press release, which was titled “With More Family Farms on Brink, Bennet, Udall, Markey Push for Much-Needed Relief for Colorado’s Dairy Producers.”

Asked about this, spokesman Ben Marter noted that Markey is the lone Colorado representative on the Agriculture Committee, and said she has been working with the chairman of that committee to “try to rush relief to some of these folks.”

“Literally, since her first day in Congress, she has really been fighting for the dairy industry in her corner of Colorado,” said Marter.

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