Saturday, December 29, 2012

Edge of the Dairy Cliff

While there has been much talk about the fiscal cliff in Washington D.C. the so-called dairy cliff is also a major problem. With the end of the current Farm Bill milk would be priced by laws from 1949 which would double the price of milk at the store. This has been reported in the Washington Post as well as on the Today Show.

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I agree with the farmer in the video in that high prices sound good for me, but they come at a cost. I am a consumer that is always looking for a way to stretch my dollar. The farmer in me wants a high price for dairy products, but the consumer in me realizes there is a limit to what people will pay for milk before they choose something else.

Hopefully Congress will at least pass some kind of Farm Bill extension that will cover dairy. The Secretary of Agriculture can take his time implementing the dairy laws that would take effect thereby giving more time to enact new laws. Also, Congress has the authority to make laws retroactive upon passage.

The big picture: I don't expect to be paying double for milk on Jan 1st at the grocery store. However, being in a state of limbo on how milk will be priced is a terrible place for a dairy farmer to be. There is still much haggling taking place on future dairy policy in Congress, and unlike many other agriculture commodities, milk is perishable. I hope they don't wait until it is all spoiled before they take action.

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