The National Milk Producers Federation's board of directors has overwhelmingly agreed to move forward with a variety of changes in federal dairy policies. NMPF said the changes would better protect dairy producers and position them more favorably in an increasingly volatile global marketplace. The concepts are contained in NMPF's approach to reforming dairy policy entitled "Foundation for the Future."
NMPF President and CEO Jerry Kozak said that package will be used as the basis for the future direction of the dairy provisions in the next farm bill, or in some other form of federal legislation that Congress may consider in the future. NMPF chairman and Rogersville, Missouri dairy farmer Randy Mooney said if there is anything good that has come out of the past 18 months of economic struggle, it's the shared feeling that producers can use this experience as the catalyst to make needed changes in dairy policy.
The Federation's proposal to revamp the federal safety net involves creating an insurance program tied to the margin between the national average cost of feed, and the national average all-milk price. After farmers choose to enroll in the base level of the Dairy Producer Margin Protection Program at no cost to them, they would receive indemnity payments during periods when their margins are severely compressed, as they were for most of 2009. In addition, farmers would have the option of purchasing supplemental coverage to protect a higher margin level between feed costs and milk prices.