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WI Dairy Groups Urging USDA to Buy Surplus Dairy Products
USAgNet - 04/03/2020

A coalition of Wisconsin-based farm organizations are asking the U.S. Department of Agriculture to use its purchasing power to bring relief to the American dairy industry in light of the economic woes brought on by the Coronavirus. In a letter to U.S. Agriculture Secretary Sonny Perdue, the groups urged the federal government to purchase milk and cheese products with money made available through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which President Trump signed last week.

"With 80 percent 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 stated. "While retail sales have increased in past weeks, they are now leveling, and orders are slowing. Dairy manufacturers and processors also have seen their export markets decimated."

The letter further said dairy processors and farmers are working together to find solutions, but these circumstances are beginning to result in fresh farm milk being dumped as local processing plants are running out of storage space.

During a conference call with the media on Thursday, John Umhoefer of the Wisconsin Cheese Makers Association said producers, processors, organizations and state governmental agencies are collaborating to keep milk flowing through the food supply chain.

"This disruption to the dairy industry is bringing unprecedented challenges to find channels for our milk," Umhoefer said. "We are asking the federal government to purchase products for food pantries and school lunch programs to help move the supply along."

Gordon Speirs, who owns Shiloh Dairy in Brillion, added that it will inevitably take a large government effort to save the industry at this point.

"One in eight households are said to be in-sufficient in their food supply," Speirs said. "We need to get this nutrition to those who need it and we have more than enough product to supply those needs."

The dairy leaders also noted that there is no official government program in place at this time to help producers who are being asked to dump their milk. But Speirs feels it may be more advantageous for the industry as a whole to swallow those losses so individual operations aren't pegged as winners and losers in a situation they cannot control.

"I see it as a national problem... and dairy is a national industry," he said. "If the amount of dumped milk equates to one-percent of the total national supply, then I would favor a situation where the entire industry absorbs that one-percent loss collectively."

In addition, the industry is also facing financial hardship due to disrupted foreign business. Umhoefer says trading ports are not only at full capacity right now, but the labor force at those facilities have also been effected by COVID-19.

The letter to Perdue was signed by Dave Buholzer, Wisconsin Cheese Makers Association; Brody Stapel, Edge Dairy Farmer Cooperative; Tom Crave, Dairy Business Association; Dan Smith, Cooperative Network; Joe Bragger, Wisconsin Farm Bureau; Jay Heeg, Professional Dairy Producers of Wisconsin; and Darin Von Ruden, Wisconsin Farmers Union.

Meanwhile, State Interim Ag Secretary Randy Romanski also sent a letter to USDA this week advocating for a government purchase of surplus commodities. He also urged Perdue to consider re-opening the enrollment of the Dairy Margin Coverage program.

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