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Exporting Companies Object to Dairy Supply Control

November 4, 2011
 
 

Source: International Dairy Foods Association

 
Top executives of six of the country’s biggest dairy exporters strongly object to the Dairy Security Act of 2011.
 
In a letter sent today to members of the Joint Select Committee on Deficit Reduction, they outlined the negative effects the act would have on domestic and global dairy markets and said it has no place in deficit-reduction talks. It is expected that the dairy program will be part of the recommendations submitted by House and Senate Agriculture Committee leaders to the supercommittee for inclusion in the debt-reduction bill.
 
“We are writing to express our concern and opposition to a pending milk supply control policy
called the Dairy Market Stabilization Program that is being endorsed by the leadership of the
House and Senate Agriculture Committees,” the business leaders told super committee members. The letter was signed by executives at Davisco Foods International, Inc.; Glanbia Foods; Hilmar Cheese Company; Saputo Cheese USA Inc.; Sargento Foods Inc.; and Schreiber Foods, Inc.
 
“The very existence of a government supply control program for dairy will be a signal to our competitors and trading partners that the U.S. is not a serious and reliable long-term supplier. The stabilization program will create significant market uncertainty and increase risk calculations for our businesses that will discourage future investment into new domestic facilities and new export markets,” they explained.
 
The business leaders noted that exports have grown by nearly $3 billion and that U.S. dairy manufacturers now export the equivalent of nearly 14 percent of the farm milk produced in our country. They took particular exception to the claim by Rep. Collin Peterson (D-MN), the ranking member of the House Agriculture Committee, that it is a “myth” that his bill will have a negative impact on export growth and that he has responded to these concerns.
 
“We strongly believe that the Dairy Market Stabilization Program will have a negative impact on dairy exports, cannot be fixed by turning it off after exports start declining and should not be part of a bill whose purpose is to reduce federal spending,” they concluded.

The six companies are members of the International Dairy Foods Association, a trade association that represents the nation's dairy manufacturing and marketing industries and their suppliers.
 

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COMMENTS (3 Comments)

James Maroney - Leicester, VT
Any American dairy farmer who believes his or her security depends upon exporting dairy products has not thought through the implications. Dairy exporters are manufacturers, whose profits depend solely - solely - on government assurances that the price of bulk milk - your milk - will remain low. The way for government to keep milk prices low is to keep milk production up. The way to assure that result is to scotch supply controls. US dairy producers should not only insist that their coops install supply controls, they should insist upon reducing supply by 14% and cut exports to zero. Once they get that done, reduce production another 5% and watch milk prices soar! Come on people: are we in business to subsidize dairy manufacturers or to make money for ourselves? Think about it for just one minute.
7:44 AM Nov 5th
 
Smallest Dairy Farmer
hese Companies are right......we have no business implementing subsidies while claiming to be a serious exporter of milk & products. US companies with this outlook unfortunately want to have their cake and eat it. Once you are branded as an unreliable supplier, you will never regain the market back. So either we want to export or not.
We need to reduce spending. A good place to start is government controls, quietly disguised as subsidies. Ethanol is a prime example ..........as well. On the one hand we claim to be free marketers........on the other hand we subsidize an old industry that, if it was a profit based industry on it's own merits, would long ago be able to survive without picking winners and losers in agriculture and many other industries. The US claiming it only wants a level in world markets.......on the one hand is guilty of a 54 cent tariff on imported ethanol besides the other generous subsidies that the ethanol industry and related blenders enjoy. That is not free marketing.
I strongly oppose any meddling in the milk market disguised as the DAIRY SECURITY ACT OF 2011.

The bright spot in dairy is that there is nearly no government subsidies........the one's there is, will not be missed IMO.

9:57 AM Nov 4th
 
Smallest Dairy Farmer
These Companies are right......we have no business implementing subsidies while claiming to be a serious exporter of milk & products. US companies with this outlook unfortunately want to have their cake and eat it. Once you are branded as an unreliable supplier, you will never regain the market back. So either we want to export or not.
We need to reduce spending. A good place to start is government controls, quietly disguised as subsidies. Ethanol is a prime example ..........as well. On the one hand we claim to be free marketers........on the other hand we subsidize an old industry that, if it was a profit based industry on it's own merits, would long ago be able to survive without picking winners and losers in agriculture and many other industries. The US claiming it only wants a level in world markets.......on the one hand is guilty of a 54 cent tariff on imported ethanol besides the other generous subsidies that the ethanol industry and related blenders enjoy. That is not free marketing.
I strongly oppose any meddling in the milk market disguised as the DAIRY SECURITY ACT OF 2011.

The bright spot in dairy is that there is nearly no government subsidies........the one's there is, will not be missed IMO.


9:56 AM Nov 4th
 



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