Milk Producers Prepare Policy Wish List for 2012 Farm Bill

The National Milk Producers Federation plans to move ahead with proposed changes in federal dairy policies that it says will better protect dairy producers, and position them more favorably in an increasingly volatile global marketplace.

The National Milk Producers Federation plans to move ahead with proposed changes in federal dairy policies that it says will better protect dairy producers, and position them more favorably in an increasingly volatile global marketplace.

Features of NMPF's plan include: transitioning the existing safety nets of the dairy price support and milk income loss contract programs into a new dairy producer margin protection program to guard against periods of severe financial pressures; establishing a dairy market stabilization program to help address periodic imbalances in milk production and demand; and reforming the federal milk marketing order program that would "create a competitive milk price, maintain Class I differentials, and eliminate unpopular aspects of the current system, such as make allowances," according to the organization. It adds that changes in the marketing order system are intended to be revenue neutral so that farmers' milk checks are not reduced.

NMPF's proposal to revamp the federal safety net involves creating an insurance program tied to the margin between the national average cost of feed, and the national average all-milk price. After farmers choose to enroll in the base level of the program (at no cost to them), they would receive indemnity payments during periods of tight margins. In addition, farmers would have the option of purchasing supplemental coverage to protect a higher margin level between feed costs and milk prices.

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