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Bill
Rowell
July
27, 2011
Genex Profit Alliance
Arlington, Virginia
Introduction and Remarks
Ladies and Gentlemen,
please pause to recognize our young men and women in the
military - we ask for their safe return.
Thank you everyone, I am
Bill Rowell, a dairy producer from Vermont, and chairman of the
National Dairy Producers Organization, it is my pleasure to be
here today. My brother Brian and I milk 950 Holsteins in
northern Vermont not far from the Canadian border, Brian's son
Matthew is now 16 and expects his opportunity to continue the
operation, he's a capable young man. His sister Megan is 14, an
honor student and potential candidate for nutritionist and CPA,
it isn't clear that it would be in their better interest, but it
will require a high level of commitment and expertise to
continue.
During the downturn of
2006, we watched trailer loads of milk leave our farm well
below what was considered fair market value, the next crisis had
already been predicted for 2009, and it was to be followed by
yet another sometime during 2012, so on and so forth; we
recognized our lack of control over the situation then, and its
similarity to the 50's and 60's on our Dad's farm. We agreed
that change in national dairy policy would have to take place
one day soon and finally recognize the producer as being key to
a viable dairy industry, that it would be necessary to develop
management tools to address the needs of the producer, and that
allowing industry partners to speak for producers all these
years had been an apparent oversight on our part, the producer
community.
The National Dairy
Producers Organization is relatively new, its board of directors
consist of producers from across the nation, it is a diverse
group whose number 1 priority is producer profitability and
sustainability. Some months ago when Foundations for the future
was first introduced and moved to the forefront, we had to
recognize the diversity of opinion among board members with
respect to dairy policy, and the need for board support of a
stated position. Since it was recognized that proceeding from a
single point of view was not representative of our board, or of
the producers interests which we represent, a board decision
formed two committees:
1) The Bill committee,
worked to draft a proposal addressing the needs of the producer
sector and identified components essential to help ensure a
future for dairy producers, and
2) The Amendment
committee, worked to enhance National Milk's program,
Foundations For The Future, in hopes of making it more
representative of the needs of the producer sector.
Prior to this effort, the board had discussed
many issues confronting the dairy producer, and there are many,
10 were identified as being of highest priority, and those were
followed by an additional 10, if you go to our website
www.nationaldairyproducers.org
you will find them listed in a document entitled “Contract with
Producers” in which the board of directors make a commitment to
serve as advocate and provide a national voice from the
producers perspective. A bill proposal was developed by that
committee which addresses 14 of those 20 issues.
Regarding a bill
proposal, the goal was to make milk profitable for the producer
with minimal changes to existing dairy infrastructure, it
appeared that it could be done, but would require success in 3
areas:
1) Supply Management –
manage the supply of milk used in inventoried products; if milk
used in butter, powder, and cheese was profitable, all milk
would be profitable. Class I and II would not be regulated.
2) Milk Price – remove
the CME as the milk price setter and substitute it with a
regional price survey mechanism to determine the average
regional milk price, and back it up with a minimum price of not
less than 80 % of the monthly average cost of production.
3) Imported Ingredients –
establish reasonable limitations and regulations, and enforce
them.
During our discussions on
imports we noticed that Country of Origin Labeling wasn't
gaining much traction ( it was on that list of 20) , so we
patented a 100% USA label; some of us think we work for
ourselves, most of us feel we spend too much time working for
the government, but the real boss here is the consumer. We
recently generated some excitement with DMI, and are now in the
process of doing a pilot project with them to determine consumer
acceptance of the label.
Many recognize the
incredible effort put forth across this country by producers,
producer organizations, co- operatives, National Milk's task
force, many of our congressional delegates and their staff, and
others who have worked exceptionally hard to find higher ground
for the dairy producer. So, on behalf of the U.S. dairy
producer, I would like to offer everyone our thanks for the
effort, and since we repeatedly find the producer in crisis,
lets complete this task with a meaningful response to the
problem. I am pleased that we have finally gotten to the point
we're at today, it's really quite exciting but time is growing
short as we approach 2012, the producer community and its
vendors understand our landscape will change significantly if we
face another crisis like that of 2009 under current policy
without meaningful
tools.
I would like to point
out that dairy is a $110 billion industry fiercely protected by
those who profit from depressed milk pricing, perpetuating a
cycle which requires export markets to achieve balance may be
good for processor profits, but it has reduced the number of
dairy farms in this country to a fraction of 1/12'th their size
since 1970; this has come at great expense to our government,
and has caused much harm to a lot of good people . I very
strongly hope that it has become blatantly obvious to everyone,
that producers are neither willing or able to subsidize the
export of dairy products in the name of commercial
disappearance. IDFA's opposition to supply management is
understandable, it would place a control on overproduction,
stabilize the price of milk, and redistribute risk to the entire
industry, but their chief concern is input cost. ( A $ 1.00
increase in the price of milk represents an additional expense
of $ 1.8 billion per year, to the processor.) The processor can
turn a profit through a more legitimate means than by
encouraging milk oversupply ( which clearly represents a
stranglehold over the producer sector and ensures depressed milk
pricing) , or by diluting the market with imports, or by
targeting the producers potential for profit as an expense.
Agriculture in this country is an asset, it represents the
highest quality food supply of anywhere in the world, producers
are an industry partner that would be difficult to replace, and
as good Americans we all have a responsibility to protect our
domestic food supply.
I will speak briefly
about the amendment committee, it was understood that
Foundations For The Future as presented was a discussion draft,
the opportunity it represents is worthy of support but two items
stand out: 1) signal to the farm - move the trigger closer to
the producers break even point, activate the management tool in
a more timely manner, establish benchmarks and use NASS monthly
storage reports to improve program response and effectiveness.
2) price survey - use the regional average price of milk and
change the survey to include plants using 250,000 lbs. per week
rather than per day, to be more reflective of the marketplace.
The amendment committee will attempt to reconcile any difference
of opinion through our congressional delegates. In the meantime,
the bill committee has developed information as a practical
response to the issues we face, it is straightforward, brief,
and well worth your time, give it a read. Finally, everyone
needs to understand the producer can work for little or nothing,
but they can not work for less than nothing and sustain a viable
dairy industry in this country. |