Area dairy farmers have not yet been affected by Congress’ failure to approve a new farm bill, according to those interviewed recently. But farmers and others in the industry hope that action is taken soon to remove further uncertainty — or trigger a major increase in prices — during difficult economic times.
The farm bill is enacted every five to seven years to provide national farm and food policy. The new legislation was passed June 21 in the Senate by a bipartisan vote of 64-35, but stalled in the House of Representatives, where it was approved by committee but never came up for a general vote. The bill expired Sept. 30, taking with it the price support system for dairy farmers.
This is the first time this has happened in 60 years, Cornell Cooperative Extension of Delaware County Educator Mariane Kiraly said about the lapse.
Although area farmers got support from conservation and crop insurance programs, the biggest impact comes from the Milk Income Loss Contract’s dairy price support payments. This is triggered when milk prices paid farmers fall below the Boston Class I base price of $16.94 per hundred pounds, with an allowance for grain prices.
With milk prices at about $21 in September, and expected to stay above the trigger price in the short term, legislators have a few months to work out something, she said. While MILC has ended, that is not true of all of the provisions. It creates an “uncertain environment,” she said. “It’s hard to plan.”
What makes it more difficult is that higher than usual prices farmers pay for items such as grain have raised farm operating costs to about what they are paid for the milk, in some cases.
South Kortright dairy farmer Barbara Hanselman said that farm programs would directly receive only about 20 percent of the funds in the bill. It governs such areas as federal milk pricing and exports and imports. The rest goes to nutritional programs, such as food stamps. As farmers become a smaller part of the population, it was a way to get support for needed programs from other legislators.
Because of the expiration, the dairy support, MILC, is “out the window,” she said.
“It bothers me there can’t be greater concern,” for getting a bill passed, she said. “It’s important for the production of food and feeding the people.” The uncertainty is “discouraging,” but its part of the job, she said, although she thought there would be an extension of the recently expired law.
The one positive things is that “it is bringing the farm community together. Farmers feel a need to reach out and say this is important. There needs to be attention to this,” she said.
If lawmakers don’t do something by Jan. 1, commodity prices could revert to a formula from the 1940s. The resulting high prices “would create total chaos,” she said.
State Farm Bureau spokesman Steve Ammerman said “we are waiting for the return of lawmakers” to see what will happen. They can pass an extension of the previous legislation, they could vote on current bill or do nothing.
“That may be the scariest possibility,” he said, and could set into motion the return of the “permanent law” of the 1940s that would set a base price of $38 a hundredweight.
“We would hope lawmakers would come to their senses and pass something,” he said.
Area legislators have supported a new bill, the Farm Bureau said. Sen. Kirsten Gillibrand, D-N.Y., a member of the Senate agriculture committee, said in a media release: “I hope the Republican leadership in the House will pass the Farm Bill by the end of this year. Anything short of that is irresponsible. For our economy to grow, our farmers need the certainty of a new Farm Bill — and they deserve it.”
Sen. Charles Schumer, D-N.Y., has expressed similar support. Rep. Richard Hanna, R-Barneveld, said in a media release he was looking forward to returning to Washington either before or after the election “to get this done.”
Rep. Chris Gibson, R-Kinderhook, voted for the Farm Bill as a member of the House agriculture committee.
Davenport Center dairy farmer Pete Christiansen said he wasn’t surprised at the current situation. Congress doesn’t see to be able to do anything, he said. With feed bills high because of such factors as the recent drought, the loss of any payments will hurt, he said.
“I don’t think there will be anything until the election,” he said. “They will do something.” But, he noted, he wasn’t counting on government help. “They haven’t been able to fix the business in a long time.”
Hobart dairy farmer David Post sarcastically said the situation shows “politicians at their finest.” If they can’t figure out all the parts of the new legislation, they can pass a one-year extension, he said.
While the price of milk may be up, the price of inputs such as “fuel and grain has gone up by leaps and bounds. It’s the highest I’ve ever seen it in the nearly 50 years I’ve been farming.”
He said he was beginning to wonder what the future of the small family farm is.
“You can’t take care of land, equipment and people,” he said.