One day after the Dairy Farmers of America cooperative began dumping milk in Wisconsin, a group of Wisconsin-based farm organizations held a teleconference with the media on April 2. They urged the federal government to provide direct assistance to farmers and purchase milk and dairy products with money made available through the Coronavirus Aid, Relief and Economic Security Act. The $2.2 trillion CARES Act was signed by President Donald Trump on March 27.
Letter to Perdue
In a letter to U.S. Secretary of Agriculture Sonny Perdue, the farm groups noted that the mass closure of restaurants, schools and other food-service outlets has resulted in a sharp drop in milk prices.
“With 80% of Americans under order to shelter in their homes, hundreds of thousands of restaurants, schools and other food-service outlets have closed or significantly reduced offerings, which means cheese and butter manufacturers have lost their largest market,” the memo said. “While retail sales have increased in past weeks, they are now leveling off and orders are slowing. Dairy manufacturers and processors also have seen their export markets decimated.”
The letter also noted dairy farmers and processors are working together to find solutions, but these circumstances are resulting in milk being dumped as processing plants are running out of space to store dairy products.
“Direct relief to dairy farmers and a substantial purchase of dairy commodities by USDA can ensure our industry will remain fiscally able to function in its primary role of feeding the nation and the world,” the group said.
The letter was signed by Cooperative Network, Dairy Business Association, Edge Dairy Farmer Cooperative, Professional Dairy Producers of Wisconsin, Wisconsin Cheese Makers Association, Wisconsin Farm Bureau and Wisconsin Farmers Union. The farm organizations are asking Perdue to spend billions of dollars to buy dairy commodities.
“The CARES Act directs $14 billion to the Commodity Credit Corporation, $9.5 billion to a dedicated disaster relief fund for agriculture, $25 billion for SNAP programs [food stamps], and $450 million to support food banks serving the food insecure,” the group wrote in the letter. “This bill enables unprecedented support for farmers and unprecedented commodity purchases, and we need USDA to bring these forms of aid to bear immediately.”
John Umhoefer, executive director of the Wisconsin Cheese Makers Association, said the cheese industry has lost a big share of its largest market. That market includes restaurants and schools now closed to the public.
“We have seen sales decline after 9/11. We’ve seen sales decline when there was the banking crisis in 2009, but more than half the restaurants in the United States are either closed or operating at a reduced level,” Umhoefer said. “That has never happened before.”
Umhoefer told the media the groups would like USDA to buy nonfat dry milk, butter and cheese to help farmers. Groups are also asking USDA to find ways to reimburse dairy farmers who are forced to dump milk or receive lower payments.
Brillion, Wis., dairy farmer Gordon Speirs, who owns Shiloh Dairy, a 4,500-head dairy farm, said he has lost 25% of his income due to plummeting milk prices.
Tim Trotter, executive director of the Wisconsin Dairy Business Association, said the government could buy food to help the growing number of people who are now unemployed.
“It’s sad that we have this call today to talk about this situation,” Trotter said. “As we went into 2020, it was the rebound year for dairy farmers. Because of this devastating situation due to coronavirus, the financial sustainability of their dairy operation is going to be jeopardized. We are all in this together. It is important that the government will give their support. We need them to get nutrition to those who are losing their jobs. Before COVID-19, 1 in 8 people had trouble getting enough food. We are sure it is going to be worse now.”