New Schumer Report: Recent Increase In Prices Paid For Milk And Cheese By USDA Will Mean Millions In The Pockets Of Desperate New York Dairy Farmers

Press Release

New Schumer Report: Recent Increase In Prices Paid For Milk And Cheese By USDA Will Mean Millions In The Pockets Of Desperate New York Dairy Farmers

In Response to Dairy Farmer Crisis, Schumer, In Letter And In Personal Meeting, Called For USDA Sec. Vilsack To Raise Price Feds Pay For Dairy Products Through the Dairy Price Support Program; Schumer Also Lobbied OMB

Last Week, Vilsack Agreed To Increase Prices

Increase Means Up To $13 Million Increase for Capital Region Dairy Farmers; $29M For Western New York; $18M For Rochester-Finger Lakes; $24M for Central New York; $17M for Southern Tier; $4M for Hudson Valley; $30M for North Country

In the midst of a catastrophic collapse in the price of milk and other related products received by dairy farmers, today U.S. Senator Charles E. Schumer released a report detailing the effects of the United States Department of Agriculture's (USDA) decision to increase the prices paid for dairy products through the Dairy Product Support Price Program. Schumer said that the increase will result in between $87 million to $136 million in additional revenue for Upstate New York's dairy farmers this year. Schumer, in a personal letter, wrote Secretary of Agriculture Vilsack asking for such increases last month, and then met with him, along with 12 other senators, earlier this week to stress the importance of doing it quickly. At that meeting, the Secretary pledged his support for raising prices paid through the program, but stated that an increase would require approval of the Office of Management and Budget (OMB). Schumer called the head of OMB, Peter Orszag, asking him to quickly approve a price increase.

Last Friday, the Secretary announced that prices would be increased. Prices will rise for nonfat dry milk from $0.80 per pound to $0.92 per pound, the price paid for cheddar blocks from $1.13 per pound to $1.31 per pound, and the price of cheddar barrels from $1.10 per pound to $1.28 per pound. The increase will be in effect between August 2009 and October 2009.

"The millions of dollars that will flow directly into the pockets of dairy farmers through this program could not have come at a more critical time. I am glad that the Secretary of Agriculture heard our pleas and commend him for taking this important action. This won't solve the problem, but it certainly will help, and I will continue to fight for actions that will help our struggling dairy farmers."

Under the Dairy Product Price Support Program, the USDA serves as a buyer of last resort to help clear commodity dairy markets during periods of exceptionally low farm-level prices. The current price levels were written into the 2008 Farm Bill, passed by Congress a year ago, but the USDA has the authority to increase those prices. The increase in prices paid to processers by the government translates directly to increased revenue to dairy farmers by increasing demand for dairy products while helping to manage supply, and therefore raising the price farmers get for their milk. The USDA estimates that the increases it has implemented will increase the price of milk by between $0.70 and $1.10 per hundredweight.

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