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April 2013 Archive for Dairy Talk

RSS By: Jim Dickrell, Dairy Today

Jim Dickrell is the editor of Dairy Today and is based in Monticello, Minn.

Immigration Reform’s Bare-Knuckle Brawl

Apr 19, 2013

For dairy farmers, the key is to stay positive, informed and engaged.

It would be easy to get caught up in irrational exuberance surrounding the Senate’s "Gang of Eight" immigration reform that was announced last week.

"Immigration reform has entered the promised land, with dairy at the top of the list," says one prominent immigration attorney, who will remain unnamed on the chance that things turn sour. The announcement, despite months and years of debate in Congress and the country, is really just the beginning salvo.

Don’t get me wrong. The Senate package is a huge win for U.S. dairy farmers. "Dairy will be the single biggest winner in agriculture," says Craig Regelbrugge, co-chairman of the Agriculture Coalition for Immigration Reform.

But there’s still a long, hard road to go.

Among the provisions:

• A "blue card" that allows existing, currently undocumented workers to remain at their jobs. To qualify, they will have to demonstrate they have been employed for 100 days between Jan. 1, 2011 and Dec. 31, 2012 on a farm, pass a background check, have a clean criminal record and pay a $100 fine.

• To achieve permanent residency status, employees must work at least 100 days a year for five years or at least 150 days a year for three years. They must show that they have paid all taxes, have not been convicted of any serious crime, and pay a $400 fine.

• The package also provides a provision for "future workers," that allows dairy farmers to legally recruit new foreign-born workers to replace those that return home.

• The program would also lessen the chance, at least in the first five years of implementation, of Immigration and Custom Enforcement raids and document sweeps. Eventually, farmers would have to verify identification documentation through the E-Verify system, but that would likely not come into play for five years.

• The reforms would also establish minimum wages for dairy workers: $11.09/hour in 2015 and $11.37/hour in 2016. These would then be annually indexed, with wages increased between 1.5% and 2.5%. Famers would also have to provide housing or pay a housing allowance —generally in the range of an additional $1/hour.

Dairy farmers might nitpick some of these provisions, but they’ll so do at their peril. The details of the ag package were carefully negotiated among a laundry list of ag organizations all now members of the Agricultural Workforce Coalition.

Members include Farm Bureau, Farmers Union, the National Milk Producers Federation, regional dairy organizations, and—most importantly to the compromise—the United Farm Workers. Keeping this coalition intact is critical.

If the 844-page "Border Security, Economic Opportunity, and Immigration Modernization Act" isn’t shredded in the Senate, it faces a bare-knuckle brawl in the House of Representatives. Will it survive? "Who the hell knows," one Washington lobbyist told me last week. "Nothing in Washington is easy."

For dairy farmers, the key is to stay positive, informed and engaged. When the time comes, dairy farmers must personally contact their legislators to make certain legislators understand dairy farmers support the legislation. Congressmen and women must understand there will be campaign funding and electoral consequences if their votes do not support immigration reform.

That sounds crass, but it is now how the game is played.

More detail on the Senate package can be read here

You can read the full bill here

Note: Western dairy editor Catherine Merlo also contributed to this report.

Bullish On Dairy

Apr 07, 2013

CRI’s Doug Wilson is convinced U.S. agriculture—and that includes dairy—is poised for a prosperous future.

There’s no other way to put it: Doug Wilson is bullish on dairy.

Wilson is CEO of Cooperative Resources International (CRI), the holding company/cooperative of Genex and AgSource.

He has a 35-year tenure with the co-op, joining Genex’s predecessor, 21st Century Genetics, in 1978. He became its CEO in 1993, and CRI CEO in 2002. His roots in dairy go back even further, to his home farm in Iowa milking Guernseys. His leadership stripes were earned in Vietnam, where he was awarded the Bronze Star among other commendations for service and valor.

Wilson spoke at CRI’s 20th annual meeting late last month in Bloomington, Minn. In his report to members, Wilson doesn’t ignore the hurdles dairy farmers face with feed prices, globalization and price volatility.

And he readily points out that A.I. and services co-ops such as Genex and AgSource are not immune from these same challenges. Example: The U.S. embargo of products to Iran because of Iran’s nuclear fissionable materials program has meant Genex cannot sell semen there.

But Wilson is convinced U.S. agriculture—farmers and the businesses that supply them—is poised for a prosperous future. Global food demand, due to growing populations and rising incomes—will increase 70% over the next 40 years.

"The American farmer is no longer dependent on [domestic] per capita consumption of commodities. Your market and your guaranteed demand are global," he says. He ticks off these positives:

• Dairy exports exceeded $5 billion in 2012, with most months exporting 13% to 15% of production.

• Beef cow inventory is at its lowest since the 1950s, yet most predict a 3% increase in beef exports this year. The demand for ground beef continues to rise, with slaughter dairy cow prices expected to average $88 in 2013.

• Dairy replacement heifers are at their lowest levels since 2009, putting a cap on dairy cow numbers and run-away milk production.

• Corn inventory is at its lowest level since 1973, but U.S. farmers plan to plant up to 98 million acres this spring. With adequate rain, we could see $4/bu corn.

• The U.S. dollar value versus other world currencies will remain low, and may even decline slightly over the next decade. That will make U.S. exports more attractive globally.

And that leads Wilson to these conclusions:

1. "It is a great time to be in production agriculture. The next decade will likely be the best any have experienced.

2. "We are on the front end of attracting non-agricultural dollars into production agriculture. . . . This will be positive for us, if we are proactively involved.

3. "Responsible technology use and adoption will be a requirement, not a choice, to feed the world."

And he adds this important note: "The cooperative business model might be even more important today than post-Depression. The original reason cooperatives formed was for collective bidding and affordability of improved products and services. Today, the reason is controlling volatility, adopting technology and assisting with globalization."

Wilson is no starry-eyed optimist. He warns U.S. agriculture must be prepared for continued volatility due to globalization and because current ag commodity inventories are so weather dependent.

But he also says this: "Those who look for the victories in change and volatility will be winners."

I think he’s right.

Click here for more on CRI’s 20 years of accomplishments. 

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