NMPF Thanks USDA for Coronavirus Response, Outlines Dairy Needs as Losses May Exceed $2.85 Billion
March 24, 2020
The National Milk Producers Federation, the largest organization of U.S. dairy farmers, commended the U.S. Department of Agriculture for its timely responses to the coronavirus crisis while outlining what agency actions could best aid dairy farmers as they brace for further public-health and market impacts of coronavirus.
“Over the last five weeks, the [USDA’s] estimate of 2020 milk prices reflect a drop of about $2.85 billion at the farm level,” wrote NMPF President and CEO Jim Mulhern in the letter, sent to Agriculture Secretary Sonny Perdue this morning. “Further drops are possible as the impact of the covid-19 outbreak spreads. The demand shock experienced by our entire economy is turning what initially looked to dairy farmers like the first decent year in the last five into one of potentially widespread economic devastation.”
Dairy farmers – whose work as part of agriculture has been reaffirmed as critical infrastructure by the Department of Homeland Security – expect to face price declines and unstable demand over the next several months, as joblessness rises, schools remain closed and farm and dairy processing operations face unprecedented logistical challenges.
Congress and the Trump Administration have already helped by approving food purchases and offering flexibility in transportation rules. In its letter NMPF said it looks forward to working with the USDA in program implementation, trade facilitation and other areas, but said additional remedies will be needed, including:
-Additional dairy product purchases, which will help Americans in need during what may be a period of very high demand at food banks;
-Compensation for milk disposal, a real possibility as logistical challenges on the farm and at manufacturing plants may create severe disruptions; and
-Re-opening signup for participation in the Dairy Margin Coverage (DMC) program, the main safety net for dairy farmers, especially small and,medium-sized producers. DMC participation declined in 2020 because of forecasts for higher prices that have been radically revised in light of coronavirus.
“U.S. dairy farmers and their cooperatives will continue to be careful stewards of the naturally nutritious and wholesome product we harvest around the clock, 365 days a year. Like you, we understand the importance of steady production and steady consumption,” Mulhern said. “We hope to work with you on the priorities outlined above, as well as other issues that may arise as we collectively grapple with the consequences of this unique challenge.”