Dairy farmers get one-time emergency aid

By:  Bob Kinzel
Vermont Public Radio

Montpelier, Vt.

(Host) There's some good short-term financial news for Vermont's dairy farmers.

Congress has agreed on $350 million dollars in emergency aid that will provide farmers with a one-time direct federal payment to help offset lower milk prices.

VPRs Bob Kinzel reports.

(Kinzel) These are very tough times for small dairy farms across the country. There's an oversupply of milk on a national basis, a situation that's led to a dramatic decline in milk prices paid to farmers.

In many cases, the price that farmers now receive for their milk is the same as it was 25 years ago, while production costs have skyrocketed during this time period.

Under the new agreement, 290 million dollars will be sent to dairy farmers throughout the country in the form of a one time direct payment - it's believed that the payments could range from 5 to 25 thousand dollars per farm.

The government will also purchase an additional 60 million dollars of cheese inventory that will be distributed to food banks.

Senator Bernie Sanders is the lead sponsor of the new agreement. He says the goal of the plan is to help smaller farms:

(Sanders) "In a way that I think will understand that the bulk of that money is not going to go to some huge farmers out west that it's going to go to everybody but emphasizing the first couple of hundred cows on dairy farms so I think the formula will probably work well for states that have small herds like Vermont and Wisconsin".

(Kinzel) Sanders says the plan is a one time, short term answer to a crisis that also needs a long term solution:

(Sanders) "I think we all understand that this alone is not going to solve the dairy crisis in Vermont or the nation - that a lot more has to be done...which deals with, among other things, the degree of monopolization in the diary industry by Dean Foods and others. And also making sure that long term we begin to move to a supply management, so that you have some stability in the market rather than the kind of volatility we are seeing now."

(Kinzel) Diane Bothfeld is the dairy policy administrator at the Vermont Agency of Agriculture. She says the plan will help Vermont farmers at a time when they really need assistance:

(Bothfeld) "Moving inventory of cheese through the purchase directly will help to clear that inventory, and in the longer term improve prices. The short-term - the 290 million dollars that's being sent directly to dairy farmers - that will be extremely helpful."

(Kinzel) The emergency dairy package is part of a much larger appropriations bill that provides more than 23 billion dollars for a wide variety of federal agriculture programs for the 2010 fiscal year.