Congress avoided a near doubling of milk prices when it passed a nine-month extension of the 2008 Farm Bill. It was part of the fiscal cliff deal Congress approved Tuesday night.
Area farmers said they were glad action was taken, but are hopeful Congress will address issues facing the dairy industry in a new bill, such as pricing and cost of production.
The previous farm bill expired Sept. 30. If no actions were taken, dairy prices would have been raised to $38 per hundred pounds of milk, according to a 1949 formula. The price is currently about $22.50 a hundredweight.
Sen. Charles Schumer, D-N.Y., said, “I am pleased that the year-end fiscal cliff deal includes a provision to avoid the ‘dairy cliff,’ which would have meant chaos for family farmers and chaos throughout New York’s supermarkets, with the doubling of milk prices.”
Schumer had urged such action for months. While the extension is far from perfect, “it avoids an unnecessary burden on families, schools and farmers alike,” he said.
Cornell Cooperative Extension of Delaware County educator Mariane Kiraly said lawmakers “kicked the can down the road” on the issue. “The extension will bring some stability,” but she said she hoped legislators would not start over on an issue that was worked on for two years.
The threat of $8 per gallon milk — a possibility if the old formula was used — helped make sure the issue was addressed, she said. It also would have affected the price government agencies pay for nutritional programs, which are a major part of the bill.
While the extension is not what the agriculture industry wanted, Kiraly said, it was important to keep the safety net in place if milk prices drop below the ceiling price of $16.94 a hundredweight, with some allowances for cost of production. The proposed bill better addressed such issues as cost of production, she said.