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New House Farm Bill Includes Dairy Risk Management Changes

US Rep. K. Michael Conaway (R-TX) on Thursday introduced a 2018 farm bill that he said addresses the economic challenges facing farmers and ranchers.
The House Agriculture Committee will hold a business meeting to consider the Agriculture and Nutrition Act of 2018 (H.R. 2) next Wednesday, Apr. 18.

Among other things, Conaway’s bill extends the dairy forward pricing program through 2023, reauthorizes the dairy promotion and research program through 2023, and repeals the dairy product donation program, which had been created under the 2014 farm bill.

The legislation also amends section 8C of the Agricultural Adjustment Act to set out the formula for determining the prices for milk of the highest use classification for Class I milk. Specifically, the Class I skim milk price per hundredweight will be the sum of the adjusted Class I differential, plus an ajustment to Class I prices, plus the simple average of the advanced pricing factors, plus 74 cents.

This change would take effect on the first day of the first month no more than 120 days after the date of the farm bill’s enactment.

As far as the dairy producer safety net is concerned, the legislation changes the name from Margin Protection Program to Dairy Risk Management Program. It also amends the 2014 farm bill to allow a dairy operation to participate in both the Dairy Risk Management Program and the Livestock Gross Margin for Dairy program (LGM-Dairy), but not for the same milk production.

The legislation would require the secretary of agriculture to submit two reports relating to the Dairy Risk Management Program; one would evaluate the accuracy of the data used by USDA to evaluate the average cost of feed used by a dairy operation to produce a hundredweight of milk; the other would detail the costs incurred by dairy operations in the use of corn silage as feed and the difference between the feed cost of corn silage and the feed cost of corn.

Another section of the bill requires USDA to revise monthly price survey reports to include prices for high-quality alfalfa hay in the top five milk-producing states (which, in 2017, were California, Wisconsin, New York, Idaho and Texas).

Changes to the Dairy Risk Management Program would take effect 60 days after enactment of the farm bill. The Dairy Risk Management Program would run through 2023.

“The farm bill keeps faith with our nation’s farmers and ranchers through the current agricultiure recession by providing certainty and helping producers manage the enormous risks that are inherent in agriculture,” Conaway commented.

Separately, US Rep. Collin Peterson (D-MN), the top Democrat on the House Ag Committee, on Tuesday introduced the Dairy Risk Management Act, which would also replace the current Margin Protection Program (MPP) with the Dairy Risk Management



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