The Dairy Crisis
Dairy operators in recent months have been facing crippling prices along with shrinking demands for dairy products. California dairy producers have been especially hit hard, with milk prices declining to 33 percent lower than last year, compared to an average 25 percent decline nationwide. High feed costs and environmental regulation have exacerbated the situation. For months, dairy producers have been operating with these record losses, struggling to pay their bills. Many producers have been forced out of business after having worked a life time to build up their operations.
 This is the most serious crisis of dairy prices that I have ever witnessed. I met with United States Department of Agriculture (USDA) Secretary Tom Vilsack to convey to him the magnitude of this situation. Rep. Jim Costa (D-Fresno), House Agriculture Chairman Collin Peterson, and House Subcommittee on Livestock, Dairy and Poultry Chairman David Scott also participated in the discussion, where the Secretary was urged to use all tools available to protect dairy farmers.
Secretary Vilsack assured us that he will use his administrative authority to do all he can to alleviate the difficulties being faced by the dairy industry, and specifically committed to using the Dairy Export Incentive Program to help move product and develop export markets for U.S. dairy overseas. We also discussed the need for the Secretary to increase dairy product purchases for nutrition assistance programs, such as food banks. The Secretary complied by announcing a donation of 200 million pounds of non-fat dry milk; storage of this product would have slowed longer-term price recovery and is designed to stimulate the industry.
The national economic recession has resulted in record high enrollments in federal feeding and nutrition programs. More than 31 million people qualify for benefits under the Supplemental Nutrition Assistance Program and the free and reduced-price school lunch program participation is an unprecedented 18.4 million children. Increasing the use of dairy products in these programs would serve to meet both our dairy policy and nutrition assistance program goals.
I realize that the coming months will be challenging, and I want you to know that I will remain in constant contact with representatives from the dairy industry and individual dairy producers so that I will have the most updated information as I continue to press the Administration for both short term and long term solutions to this crisis.
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