|
[ Home ] [ Leadership ] [ About Bill ] [ News ] [ Chuck ]
Supply Management Tools
Desperate to eliminate a milk surplus of nearly 4%, dairy farmers now
recognize their lack of control over the market and face reality with only
two options, either produce milk or go out of business.
Dairymen operating well below their cost of production recognize the current
surplus has cut their milk check in half. Three months ago the dairy
industry questioned national acceptance of a supply management program,
today dairymen expect one.
During these
past months, dairy farmers nationwide have searched for a management plan to
effectively shock the system and provide an exit from this crisis. There are
few tools available which appear to have enough control over supply to move
the industry forward. The CWT Program is recognized as operational and
reasonably efficient yet it lacks in participation by a full 1/3 of U.S.
dairymen who object to its nature.
The CWT Whole Herd
Buyout Program is only part of the management tool we need, it does not
recognize the loss of valuable animals or genetics, it leaves nothing intact
to support farm infrastructure, and it reduces the number of operating dairy
farms nationwide. Create a powerful management tool; enhance CWT by
implementing a Milk Diversion Program to operate alongside the Whole Herd
Buyout Program. Circumstances for dairymen appear similar from a distance
yet the audience consists of individual needs. The nature of operating both
programs simultaneously allows dairymen the opportunity to choose a level of
participation that addresses their needs, which results in control over milk
production sensitive to market demand.
Historically,
supply management has cost the CWT Program $6.25/100. Under a new program to
reduce production, pay dairymen $7.00/100 not to produce anywhere from 10%
-30% of their annual production, they choose the amount, and they choose the
method. The contract period is for one year unless milk hits a trigger price
of $17.00/100 for two consecutive months, which then fulfills the
obligation.
The concept of allowing
dairymen to participate in supply management while retaining their herd,
maintaining their infrastructure and not confining them to a restrictive
contract offers the industry great opportunity. Under certain circumstances,
an individual may prefer the Whole Herd Buyout, their choice.
Finally, since the CWT
Program belongs to dairy producers, the producers' voice should be heard
through an advisory panel to represent the better interests of the dairy
industry, which includes the dairy farmer.
|