Forget spilled milk -- dairy farmers seem ready to spill blood. They're seeing red because of declining raw milk prices, the result of a decrease in worldwide demand and a glut of milk production that was ramped up in expectation of greater demand that never materialized.
Some groups are seeking legislative redress, while others feel that financial subsidies are the only way to keep dairy farms in operations. Farmers donned cowsuits to protest a recent hearing by the Department of Agriculture, and last Friday, the Kansas City-based Dairy Farmers of America announced it would be distributing a $9.5 million cash payment in an effort to help its members nationwide through the current market crisis.
Although last year's farm bill included a provision to create a commission to study fluctuations in milk prices, the U.S. Department of Agriculture has yet to receive or ask for the funding to underwrite the 14-person committee. The commission was also designed to study the minimum milk prices paid regionally in an effort to determine if this was hindering competition or transparency.
And so contraction is occurring in the marketplace as farmers are forced to thin their herds to slow down production. Otherwise, each cow could represent a potential additional loss if the sale price of raw milk fails to exceed the cost of production. Missouri dairy farmers have begun to take that step -- year-to-year milk production was down 4.4 percent in June due to a decrease in the total number of cattle. But that hasn't stopped those still in business from lobbying for additional federal support.
An Associated Press story from Sunday details how the Missouri Dairy Association has reached out to the state's congressional delegation to ask for increases in the federal subsidy program known as the Milk Income Loss Contract, in an effort to stop farmers from being at the mercy of boom and bust cycles in milk prices.
[Image via Flickr: Milano]
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I recall a year ago milk was teetering around the 5 dollar mark a gallon all over the country. I am glad to see it has come back down! I drink so much milk!!
Can't really blame the farmers for being upset. Very few other products have remained as cheap as milk over the years. They're having to pay more for almost everything they buy - way more in many cases - but they're getting less in real dollars than they were getting thirty years ago.
In 1979, a gallon of milk cost a little under two bucks. Today, you can buy a gallon of whole milk at Costco for about $2.35 or so. Can you name any other products with that sort of history? I sure can't think of any.
In 1979, the minimum wage was around three bucks an hour. Today it's seven something. Can you blame the farmers for being pissed? Where's THEIR raise?
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