Dayton aide meets farmers

They want

production

controls,

2-tier prices

By FRITZ BUSCH

Journal Staff Writer

NEW ULM -- Sen. Mark Dayton's Director of Agriculture Outreach got an earful of opinions Friday when he talked to a small group of dairy farmers about their issues at the 20th Street Grill.

Gary Wertish learned that the consensus of nearly a dozen farmers was that production and price controls were among the best ways to boost their shrinking profit margins.

Other complaints centered on too much free trade, soy milk that shouldn't really be called milk, high replacement cattle prices, over regulation, loss of the earned income and Investment credits and that small producers don't benefit from effective dairy ads paid for by producers.

Other producers asked about the possibility of government herd buy-outs -- which took place in the 1980s and creating fair trade instead of free trade.

Last month, Dayton (D-MN) and Larry Craig (R-ID) introduced legislation to stop foreign dairy product importers from circumventing U.S. trade laws. The Craig-Dayton Milk Import Tariff Equity Act, "The Mighty Bill" (S. 560) is aimed at the rapidly-increasing level of unfair imports flooding the American market that are pushing already-low dairy prices down for U.S. producers and helping drive out businesses.

Currently, Milk Protein Concentrate (MPC) is not subject to the same quotas required of other dairy products. Foreign exporters began exploiting the loophole by blending previously-processed dairy protein -- like casein and whey -- with non-fat dry milk to boost its protein content so it qualifies as milk protein concentrate.

The resulting blends are being imported into the U.S. market in ever-increasing amounts, displacing sales of domestic dairy products and lowering prices for U.S. dairy farmers.

A 2001 General Accounting Office study said MPC imports surged from 805 metric tons in 1990 to 53,000 metric tons in 2000, in increase of more than 6,500 percent. Most MPCs come from New Zealand, Ireland and European countries, according to Wertish.

The Craig-Dayton bill would close the loophole by regulating MPC imports the same way other dairy product imports are regulated. Dayton said he expects broad bi-partisan support for the bill, which was endorsed by the National Milk Producers Association.

Wertish said he thinks the bill is likely to pass despite opposition from free-trade advocates and large users like Kraft Foods that buy cheap milk from the world market.

The bill that would allow Congress to go back and ratify what Wertish called badly needed change in the dairy industry.

He urged producers to wrote and telephone national politicians about the need to sign on to the bill. Wertish called the bill a small band aid for the agriculture industry that needs more supply management controls.

Mark Furth, President of Associated Milk Producers Inc. (AMPI) of New Ulm, said U.S. food consumers are spoiled because they get the highest quality, largest choice and lowest-priced food in the world.

Producers liked the idea of creating a two-tiered milk pricing system that would give them higher prices for the first hundred weight.

A Nicollet County farmer accused the government of paying farmers with one hand and taking profits away with the other.

Furth urged farmers not to divide dairy issues between large and small producers.

"We're all big producers compared to our ancestors," Furth said. "All producers are hurting, no matter how many cows are milking. AMPI is just a coop. It needs successful dairy farmers of any size. If too many producers fail, there will be no more AMPI."

Furth said the country needs to get off the free-trade "kick" before more agriculture is destroyed because it is taking everything in agriculture to the lowest price.

"We keep getting snookered by one-way foreign trade agreements," Furth said. " . . . land values are underpinning the whole nation."

Wertish said free-trade advocates will say the theory hasn't been given enough of a chance to those that want to do away with it.

A farmer complained that since Sept. 11, 2001, the job market has dried up to the point that farmers can't out from underneath their work.