PITTSFIELD – When word arrived Monday afternoon that U.S. Secretary of Agriculture Anne Veneman will begin sign-ups for the 2002 Farm Bill dairy assistance program next week, farmer Walter Fletcher breathed a sigh of relief.
“We’re hurting,” he said. “This is the worst I have ever seen.”
Fletcher and other Maine dairy farmers have watched the bottom drop out of milk prices this summer. Last month he was paid $11 per hundred pounds of milk while it cost him more than $16 to produce the same amount.
Although the Farm Bill was passed in May, no regulations or sign-up process had been implemented until Monday. Maine’s entire congressional delegation last week pressured Veneman to move the process along and help save family farms from closure.
U.S. Sen. Olympia J. Snowe and 2nd District U.S. Rep. John Baldacci praised implementation of the dairy provisions they both fought for in the 2002 Farm Bill that will provide about $6 million annually in payments to Maine’s dairy farmers.
The dairy provisions set a minimum price floor for milk products, with assistance to farmers kicking in when fluid milk prices hit $16.94 per hundred pounds of milk. It was enacted to help offset the damage done to farmers with the failure to reauthorize the Northeast Interstate Dairy Compact, a marketing agreement between farmers and processors that provided payments to balance the widely fluctuating milk market.
“This is money in the bank for Maine’s farmers,” said Baldacci. “Bankers and creditors will look at this promise of reimbursement as real money.”
“Many producers in Maine and other states need this program in order to remain viable,” Baldacci said. “And consumers need the price stability and access to fresh, locally produced dairy products this new initiative will help to ensure.”
During a visit to a Connecticut farm Monday, Veneman said that dairy farmers could contact their local Farm Service Agency office to enroll in the Milk Income Loss Contract program. Benefits are expected to reach farmers by October.
“This will mean a very good check for us,” said Fletcher, “but it will all go towards catching up. Summer’s been rough.”
Snowe said: “Help is on the way for dairy farmers, who can rely on the promise of this assistance to keep their operations on line. This is a welcome development that comes just in the nick of time for many farmers. With price benefits retroactive to December of 2001, this will help keep small farms afloat when prices drop.”
The MILC program was a Band-Aid, not a cure, for milk pricing woes following the expiration of the compact, according to Snowe and Baldacci, and both have pledged to work to reinstate the compact when the MILC program expires in 31/2 years.
“The delay in implementation of the MILC program is regrettable, as it could have been a seamless system of help like that provided under the Northeast Interstate Dairy Compact, which provided a preferable benefit without cost to taxpayers. This farm assistance is the next best thing, however, which provides a safety net to allow farmers to remain in business even if milk prices drop below the price floor,” Snowe said.
Under the guidelines announced Monday by USDA, dairy farmers must enter a contract with the USDA Commodity Credit Corp. to provide monthly marketing data, and remain in compliance with federal conservation rules.
MILC payments to dairy farmers will occur on a countercyclical basis, when the price of Class I fluid milk in Boston falls below the $16.94 price floor per hundred pounds of milk. Payments will represent 45 percent of the difference, be distributed for months when prices fall below the floor, and will be retroactive to December 2001. Producers will have the option of selecting the month in which they want to begin receiving payments for eligible production.