September 30, 2009

Schumer, Gillibrand Announce $350 Million To Help Dairy Farmers Reeling From Crisis In Final Agriculture Appropriations Bill - $290 Million Will Be In Direct Payment To Farmers

$290 Million In Direct Payments Is A Big Win For NYS Dairy Farmers - Direct Payments Benefit NY’s Small Farms

Washington, DC - U.S. Senators Charles E. Schumer and Kirsten Gillibrand today announced $350 million to the U.S. Department of Agriculture to help New York farmers struggling during the dairy crisis in the final Agriculture Appropriations Bill. Senators Schumer and Gillibrand aggressively lobbied their colleagues in the House of Representatives and Senate to include the provision in the final legislation. Senator Bernie Sanders of Vermont authored the measure that was included in only the Senate version of the legislation. Senators Schumer and Gillibrand said that the $290 million in direct payments is a big win for New York's dairy farmers.

The agreement includes $60 million in cheese and dairy product purchases for food banks and other nutrition and feeding programs, and $290 million in direct support to dairy farmers using guidelines to be determined by the Secretary of Agriculture. Schumer and Gillibrand said the direct payments will be important to help keep dairy farmers solvent during this current crisis.

"Our dairy farmers are hurting like never before from forces beyond their control and this assistance will help them weather the storm," said Schumer.  "A large step was taken when we convinced Secretary Vilsack to increase prices paid to farmers, but putting $290 million directly in the pockets of dairy farmers will be a tremendous shot in the arm."

"During these tough economic times, this increase will bring some much needed relief for our farmers," said Senator Gillibrand, the first New York Senator in 40 years to serve on the Senate Agriculture Committee. "While this is great for New York's dairy farmers, this is only a temporary solution to the fundamental problems with the dairy pricing system. I will continue to work for a long term fix for our farmers."

Senators Schumer and Gillibrand have been leading the charge for dairy farmers.  Senator Schumer has been aggressively lobbying the Secretary of Agriculture to provide emergency direct payments to dairy farmers in New York and has called on the Department of Justice to investigate the discrepancy between the fall in prices dairy farmers are seeing and the much smaller drop in the price of milk in the store.

Senator Gillibrand has introduced legislation that would double the amount of money farmers get from the Milk Income Loss Contract (MILC) program retroactive to the low point of the crisis in March. She also introduced legislation that would index the MILC rate of $16.94 to inflation. The price floor of $16.94 per hundredweight has not changed since the 1990's, yet the cost of production has increased exponentially. The MILC program payments were originally designed to help dairy farmers in their time of need, but have remained stagnant. In August, Senator Gillibrand hosted a hearing in Batavia, New York, to discuss long tern fixes for the dairy pricing system, and has pledged to hold a similar hearing in Washington, D.C.

New York farmers are facing a dairy pricing crisis. According to the USDA, it costs a New York dairy farmer $18.82 to produce a hundredweight of milk. Yet in July, the average New York farmer received only $11.60 per hundredweight, though a number of farmers reported receiving even less.  The MILC program was designed to be a safety net when there is a large price discrepancy, but has not been able to adequately protect New York's dairy farmers. As a result, New York farmers have been forced to either take on massive debt to cover their costs or go out of business.

The House-Senate Conference Committee is set to vote on the Agriculture Appropriations Conference Report this afternoon. The legislation will then be voted on in both chambers, and sent to the President to be signed into law.  Senators Schumer and Gillibrand pointed out that the provision is now in the final draft of this must pass bill.