| MARCH 26, 2010 -- This week, Pennsylvania Ag Secretary Russell Redding joined eight other Northeast state ag leaders in seeking more dairy industry support from UDSA Secretary Tom Vilsack.
The joint letter sought urgent reinstatement of the federal support price for cheddar block and barrel cheese and non-fat dry milk to levels established in August 2009. "Restoring the support prices will provide an immediate boost to the economic stability of Pennsylvania's nearly 7,300 dairy farm families," adds Redding, "and would help them begin to rebuild the decades of equity lost during the past 15 months."
Co-signers also included Connecticut Ag Commissioner F. Philip Prelli, Delaware Ag Secretary Ed Kee, Maine Ag Commissioner Seth Bradstreet, Massachusetts Ag Commissioner Scott Soares, New Hampshire Ag Commissioner Lorraine Merrill, New Jersey Ag Secretary Douglas Fisher, New York Ag Commissioner Pat Hooker, Rhode Island Ag Chief Kenneth Ayars and Vermont Ag Secretary Roger Allbee.
The logic of their proposal
Cheese and non fat dry milk prices have been extremely volatile over recent months and have fallen dramatically. This is reversing the expected recovery process. The ag leaders contend it will have a devastating impact on 2010 farm finances.
"Increasing the support price for cheddar cheese to $1.31 per pound and barrel cheese to $1.28 per pound and non fat dry milk to 92 cents per pound from August 1 to October 30 of last year had a profound, positive impact on the market place at little if any cost to the government. That same positive impact is needed at this time to assist our struggling dairy farmers.
"In 2009, the support price for cheese became the target price that cheese buyers could force, even though it resulted in a farm milk price often $5 below the farm cost of milk production. When USDA increased the support price for cheese by 18 cents per pound on Aug. 1, 2009, the 'market' incorporated that new benchmark and raised market price without any cheese being sold to the government at the higher price.
"We believe the same situation would likely occur today. This action on your part would send the right signals to the market and to dairy farmers. We request that you immediately re-establish these levels of price support."
The state officials pledged to continue working with USDA to support the Northeast region's dairy sector. Included in these efforts is providing ongoing updates to USDA about the health of the dairy industries and proposing policy change ideas on the national level to help dairy producers.
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