Dairy is an important part of the agriculture industry, and plays a critical role in Pennsylvania’s economy, generating $14.7 billion in annual revenue and more than 52,000 jobs. Dairy also plays an important role in diets, because it contains nine essential nutrients, and is a good source of protein. While these facts are compelling, the dairy industry has also been greatly challenged in recent years.
Volatile markets, declining milk prices, increased milk production worldwide, trade impacts, weather challenges, reduced consumption, and more have led to dire straits in the dairy industry. As a result, an increasing number of dairy farmers are exiting the business. Nationally, nearly seven percent of dairy farms ceased operations in 2018, while In Pennsylvania, we lost about six percent of our dairy farms, which amounts to 370 farms.
In 2016, USDA projected that the nation’s per capita milk consumption had declined 25 percent over twenty years. Milk price volatility, the proliferation of imitation “milk” and bottled water products, reduced consumption of ready-to-eat cereals, and government policies limiting school milk options all contributed to the decline in milk sales.
While the new Farm Bill strengthened the safety net for dairy farmers, it is not enough to reverse the financial challenges we are seeing in the dairy industry. The new USMCA agreement – with its increased access for dairy products to Canada, changes in the Canadian supply management system, and continued strong trading relationships with Canada and Mexico – will also provide some much-needed benefits to dairy farmers. Several bills have been introduced which will help to address issues impacting the dairy industry:
- H.R. 832, Whole Milk for Healthy Kids Act of 2019, which, if passed, which would allow for unflavored and flavored whole milk to be offered in school cafeterias.
- H.R. 3125, the School Milk Nutrition Act of 2019, would ensure expanded milk options for students by reaffirming the recent USDA regulation offering schools the option of serving low-fat flavored milk. The bill also requires that the milk offered be consistent with the most recent Dietary Guidelines for Americans.
- H.R. 1769, the Dairy Pride Act, would require that the Food and Drug Administration (FDA) take enforcement action against manufacturers labeling non-dairy products as dairy. The bill stops the use of dairy terms such as milk, yogurt, cheese, etc on the labels of non-dairy products made from items like nuts, seeds, plants, etc. It does not prevent the sale of non-dairy products, it only addresses the labeling issue.
- S. 1810, the Milk in Lunches for Kids (MILK) Act would allow to serve whole or two percent milk, and permit milk to be excluded from the fat cap in school lunches.
On the regulatory side, Farm Bureau has called on FDA to vigorously enforce food standards regarding the labeling of dairy products and prohibit the misleading labeling of nut- and plant-based food products as “milk” or other common dairy names. Farm Bureau has also been actively involved in raising the issue to FDA’s attention, and commenting throughout the process.
Farm Bureau will also be pursuing Federal Milk Marketing Order Reform. After a year-long debate among Farm Bureau dairy members from across the country, farmer delegates voted on new policy at the 101st Annual Convention to guide the organization’s work to improve federal dairy policy and milk pricing provisions. These new policies are designed to address how farmers may participate in the ballot casting process during federal rulemaking on milk pricing provisions; broaden and enhance price discovery for milk and dairy products to create opportunities to enhance the value of milk paid to producers; and improve risk sharing and efficiency among dairy farmers and milk processors through adjustments in Federal Milk Marketing Order milk pricing and pooling provisions. To learn more, see: https://www.fb.org/files/AFBF_FMMO_Final_Report_frr.pdf.
For More Information
AFBF Market Intel Articles:
- “Revisiting Record-Large Negative PPDs on Milk Checks”
- “Negative PPDs to Offset Milk Price Rally”
- “Reviewing Expected Benefits of Dairy Revenue Protection and Dairy Margin Coverage”
- “Reviewing Dairy Margin Coverage”
- “Reviewing Dairy Revenue Protection Participation”
- “Dairy Gets a Lifeline in the Farm Bill”
- “How Milk is Priced in Federal Milk Marketing Orders: A Primer”
- “Trends in Beverage Milk Consumption”
- AFBF Market Intel, “The Dairy Case is More Competitive Than Ever”
Farm Bureau asks for support and cosponsorship of the following bills:
- H.R. 832, Whole Milk for Healthy Kids Act of 2019
- H.R. 3125, the School Milk Nutrition Act of 2019
- H.R. 1769, the Dairy Pride Act
- S. 1810, the Milk in Lunches for Kids (MILK) Act.