National Farmers Pushes $13 Floor for Dairy Aid

This initiative aims to address systemic flaws that result in zero payments to family dairy operations during periods of artificially low feed costs. In Wisconsin, the struggle is highlighted by farmer Tom Crosby, whose farm faced a steep financial challenge when the milk price of $20.80 per hundredweight did not trigger any government support due to the current DMC calculation methods.

The DMC program designs its payments based on the difference between milk prices and feed cost indices: as margins increase, payments decrease, and vice-versa. Nevertheless, during trade war pressures and market distortions, feed prices can drop drastically, canceling out necessary support for farmers when milk prices fall. Crosby, the Regional Director of National Farmers, emphasizes that the proposed margin floor should account for the fact that many family farms grow their own feed and do not benefit from the reductions reflected in government indices.

The reform is crucial because the disconnect between actual farm feed production costs and government pricing indices can undermine the safety net's effectiveness. National Farmers argues their proposed margin floor aligns with historical USDA data, ensuring a more reliable support system for small-scale dairy farmers who are the backbone of the US dairy sector.