In the wake of what some farmers have called the Great Dairy Recession, many dairy farmers across the United States are still struggling to make ends meet. In 2008, in part due to the larger U.S. recession, dairy prices across the country plummeted while export markets shrank. This combined with high costs of fuel and rising feed costs (caused by the diversion of corn to ethanol production) to drive many farmers out of business.
Part of the larger problem, many dairy farmers have argued, is that the safety nets in place to aid their industry have been woefully inadequate. The biggest problem with the current safety net is its age. Devised at the height of the Great Depression, current dairy policies are decades old and no longer reflect current dairy consumption patterns. No longer a local industry, dairy farming is a national, even international, industry.
All of these factors translate into a still unstable industry. Even though prices have risen over the past year (hitting a high of over $3 a gallon nationwide) dairy farmers are still in a difficult spot. With feed and fuel costs still high, many farmers have barely been able to break even and many others are still buried in significant debt.
Congress is considering several proposals to aid dairy farmers, the most popular being one by Minnesota Representative Collin Peterson who would limit milk production in order to avoid price fluctuations.
However, all Congressional remedies would depend on how much money is cut from the federal budget over the next ten years as part of the debt ceiling agreement.
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Written by: Justin Ellison / Farm Plus Staff Writer