Secretary of Agriculture Tom Vilsack announced this afternoon that USDA will donate some 200 million lb. of milk powder to USDA's Food and Nutrition Service for use in domestic feeding and school nutrition programs.
The announcement will likely have little impact on short-term dairy prices, since the powder has already been purchased by USDA under the Dairy Product Price Support Program. But today's announcement essentially empties USDA's cupborards. Since the beginning of the 2009 fiscal year on Oct. 1, USDA has purchased 203.6 million lb. of powder. Consumption of this powder will now not hang over the market and won't be released into the commercial market when prices rebound.
"President Obama understands that providing food to those in need will help many weather these tough economic times,” says Vilsack. "At the same time, USDA's disposal plan will benefit dairy farmers, who have seen markets disappear and prices plummet in recent months, by increasing consumption of milk and other dairy products.”
The acquired products are expected to include items such as instantized NDM, ultra high temperature milk, cheese, and soups for domestic feeding programs. Products should be moving through the supply chain starting in this spring and continuing through 2009.
- 40 million pounds of NDM will be fortified and instantized, placed into consumer-sized packages, and made available for use in the National School Lunch Program, TEFAP, CSFP, and FDPIR;
- 30 million pounds of NDM will be donated to States for further processing to acquire fortified fat-free fluid milk and macaroni and cheese, for use in the National School Lunch Program;
- 60 million pounds of NDM will be bartered for 1% ultra high temperature milk, for use in TEFAP;
- 20 million pounds of NDM will be bartered for ready-to-eat, milk-based soups (Creamy Tomato, Cheese), for use in TEFAP; and
- 50 million pounds of NDM will be bartered for reduced fat and lite cheeses, for use in the National School Lunch Program and TEFAP.
In addition to the 200 million pounds above, USDA also plans to make NDM available as follows:
- at least 1 million pounds on a competitive basis, for the production of casein;
- about 500,000 pounds for use in the McGovern-Dole International Food for Education and Child Nutrition Program; and
- about 1 million pounds for use by the U.S. Agency for International Development, based on anticipated requests from the State Department.
Many of the products will move through Feeding America, which is the nation's leading domestic hunger relief charity. Feeding America works with 206 food banks nationwide, serving more than 25 million people. Since the recession began, Feeding America has seen more than a 30% increase in the number of people seeking food aid, including many from the middle class who never sought help before.
"We don't expect the situation to likely reverse in the immediate future,” says Vicki Escarra, President and CEO of Feeding America. "This a win-win for everyone. It will help us close the gap for food needs, help school children and people internationally, and help our friends, the dairy producers.”
Jerry Kozak, President and CEO of the National Milk Producers Federation, also called the milk donations "an important first step” in alleviating low milk prices. He noted the donations won't displace commercial sales.