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Details emerge on Casey’s “Dairy Advancement Act of 2011”

October 13, 2011

Senate Bill 1682 was not yet posted today, but details on Sen. Bob Casey’s (Dem., Penn.) “Dairy Advancement Act of 2011” were sent out this afternoon by the Dairy Policy Action Coalition (DPAC), a self-described group of grassroots dairy producers.

If the bill were to become law, dairy producers would be able to choose between signing up for Milk Income Loss Contract (MILC) payments or subsidized Livestock Gross Margin-Dairy insurance at the $1.50 deductible level for not more than 3 million lb. of milk each year. Producers could, at their own expense, reduce the deductible level or “increase the quantity of covered pounds under this section.”
Unspecified in the bill is the level of the insurance subsidy. Also unspecified is the annual production limit of the MILC payment, which is scheduled to roll back to 2.4 million lb./year on Sept. 1, 2012. The current production limit is 2.985 million lb./year.
The bill would also require USDA to establish a 2-class system under the Federal Milk Marketing Orders. The first class would be for fluid milk; the second for all other dairy products. Prices for both classes would be determined using component prices for butterfat, protein and milk solids.
The Secretary of Agriculture would be required to submit a report to Congress on the proposed amendments to the Federal Orders, and that the proposed amendments take effect not earlier than 180s after the date on which the report is submitted. What’s unclear is whether producers would get to vote on the proposed changes.
The bill also requires daily, weekly and monthly price for dairy commodities by a dairy processor who processes more than 250,000 lb. of milk monthly. Exempted from the requirement is any manufacturer or facility that stores less than an average of 10,000 pounds of dairy products monthly on an annual basis.
The bill would also provide up to $15 million in low interest loans for up to 15 year to processors to retool plants. Financing provided by a bank for cooperatives could not exceed $1 million or 75% of the cost of upgrade per project.
DPAC is funded by donations from dairy producers in 20 states and businesses that serve dairy producers in eight states.


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