Northwest Dairy Association Supports Draft Dairy Reform Legislation

SEATTLE — Northwest Dairy Association (NDA), a dairy farmer-owned cooperative, and Darigold, Inc., its wholly owned milk processing subsidiary, recently pledged support for the draft dairy reform legislation released by House Agriculture Committee ranking democratic member Collin Peterson (D-MN) earlier this summer. Peterson, who plans to introduce the legislation this fall, will be joined by Congressman Mike Simpson (R-ID) as a co-sponsor. The proposal is based on Foundation for the Future (FFTF), a comprehensive dairy reform proposal authored by dairy leaders across the country.

“Our decision to support the Peterson/Simpson proposal is not one taken lightly,” according to Jim Werkhoven, Chairman of the Northwest Dairy Association and Darigold boards of directors and a dairy farmer in Monroe, Washington. “We began our evaluation of the proposal more than a year ago, by presenting it to the membership at our annual meeting. Since then, we have discussed the plan in many forums, including area producer meetings. There is an industry consensus building around Foundation for the Future that promises improved economic stability for dairy farmers and ensures food security for the nation.”

The impetus for redirection in federal dairy policy was the precipitous drop in milk prices in 2009 that forced thousands of dairy farmers out of business and resulted in virtually all producers selling their milk far below the cost of production. By all accounts, dairy famers’ equity was decimated by prolonged low milk prices, which were exacerbated by historically high feed prices – the largest milk production cost – during the same time.

“Given Northwest Dairy Association’s and Darigold’s position in the marketplace as a farmer-owned cooperative and global processor of a full range of dairy products, we are uniquely situated to evaluate and appreciate the positive aspects of Foundation for the Future,” according to Jim Wegner, President and CEO of the NDA/Darigold organizations. “We have been part of the national conversation that helped formulate FFTF, and we support its multiple provisions as a package deal. Should changes to the program be contemplated, we will be fully engaged in the conversation to assure that our member-owners’ interests are well served and that the dairy industry is positioned for future success.”

Initiated by the National Milk Producers Federation (NMPF), of which Northwest Dairy Association/Darigold is a member, FFTF proposes elimination of the federal dairy support program that removes excess dairy products from the market in favor of a risk-management program that insures producers against extremely low margins between milk and feed prices. The result is less milk price volatility and a reasonable opportunity for producers to cover their costs of production. The program includes elements that send immediate, but temporary, market signals to producers to curtail production when supply and demand fall out of balance. It also sets in motion comprehensive reform of the Federal Milk Marketing Order system, a USDA program that ensures orderly marketing of producers’ milk within given geographic areas.

Upon release of the draft legislation, NMPF’s President and CEO, Jerry Kozak, said, “This is a long-anticipated and very welcome next step in the process of upgrading dairy policy to better provide farmers with protection, stability, and the opportunity for growth.” In the coming weeks, NMPF will continue to work with Peterson and Simpson to build support for the legislative draft, seeking additional co-sponsors from both political parties, in order that Congress can take it up for consideration as soon as possible.

“NDA and Darigold join with Congressmen Peterson and Simpson, National Milk Producers Federation, and dairy farmers across the country in seeking sponsorship for, and early consideration of, the draft legislative changes necessary to implement Foundation for the Future,” said Wegner.

Northwest Dairy Association is a farmer-owned cooperative with 550 members, providing an estimated 5,000 on-farm jobs, across six Western states. NDA members produce more than 7.0 billion pounds of milk annually. Darigold, Inc. is a leading dairy company in the nation and the world, with annual sales in excess of $2.0 billion. Darigold, Inc. employs 1,500 people across the region.

Source: Northwest Dairy Association/Darigold, Inc.