Bipartisan group cites the "economic catastrophe" facing California’s dairy families.
Source: Western United Dairymen Weekly Update
Citing the "economic catastrophe" facing California’s dairy families, 20 members of the California Legislature this week sent a letter to California Department of Food and Agriculture Secretary Karen Ross calling on her to "expeditiously review" Western United Dairymen’s petition seeking a hearing for emergency price relief. The CDFA has until Aug. 21 to respond to the request for hearing.
The bipartisan group of legislators noted that feed costs are at record highs due to both federal ethanol policy and the disastrous drought impacting the major dairy feed producing areas in the Midwest. Many dairy producers are unable to acquire feed unless they pay in advance, pay upon delivery of feed or agree to sign over a second deed of trust on their property to the feed supplier.
Further financial pressure stems from the revenue disadvantage California dairy producers face compared to farmers in other states, said the legislators. "California’s regulated minimum milk prices are severely lagging below prices paid to farmers within other milk marketing orders for the same class of milk," said the legislators.
Pointing out that many Central Valley counties have unemployment rates hovering around 20%, the legislators expressed their concern about the potential impact of the financial collapse of the dairy industry. "Loss of well-paying, year-round jobs in the dairy sector would have crippling effects on our economic revival," they said.
Western United Dairymen filed a petition on Aug. 6 with the CDFA asking for action on two fronts:
• First, emergency price relief due to the current financial pressures on dairy producers, notably due to extremely high feed costs. WUD is requesting a six-month increase of 50 cents per cwt. on all classes of milk.
• Second, changes to the whey value of the Class 4b formula. WUD is requesting the cap of $0.75 per cwt. be removed by proposing a scale that mirrors more closely the whey value in Federal Class III. WUD is also proposing a dry whey exemption on the first 100,000 lb. of milk processed daily by cheese makers. The exemption would be only on the whey portion of the Class 4b formula.