Empire State Today

Standing at Har-Go Dairy, a second and third-generation family owned farm and member of the Upstate Niagara Cooperative, Inc., U.S. Senate Majority Leader Charles E. Schumer today revealed that the vital Dairy Margin Coverage (DMC) Program Finger Lakes dairy farmers rely on is in limbo as the program is set to expire, which could have farmers facing a “dairy cliff,’ – an outcome that could double wallop farmers and consumers.

Schumer explained that the 2018 Farm Bill enacted the DMC, which offers monthly price support payments from the feds to dairy farmers, will end in September and if no action is taken would lead to less support for our farmers, severe supply chain disruptions and an increase in the price of milk. Schumer is now launching a new push to protect this program, as Congress begins negotiations for this year’s farm bill, to ensure Upstate New York dairy farmers have the support and safety net they need.

“Genesee County is the heart of Upstate New York’s dairy industry, and our farmers by the end of this year could be looking over a ‘dairy cliff’ that threatens lifeline payments, puts the industry in limbo, and increases the price of milk,” said Senator Schumer. “The Dairy Margin Coverage Program is essential support for our farmers, like Har-Go Dairy, and to keep best quality milk made from New York farms flowing to families across America. I helped enact the Dairy Margin Coverage Program in the 2018 Farm Bill and I will not stop fighting to churn up support to protect this critical program for our Upstate dairy farmers.”

John T. Gould, President and Chairman of the Upstate Niagara Cooperative, Inc. Board of Directors and Owner of Har-Go Farm dairy said, “We welcome Senator Schumer here today to talk about the importance of passing a new, on-time farm bill that maintains the critically important Dairy Margin Coverage which provides an effective safety net for New York dairy farmers.  Over the last several months, farmers have struggled to make ends meet and the Dairy Margin Coverage program has helped to bridge that gap.  An on-time farm bill will ensure that this vital program does not lapse and can continue to help dairy farmers when they need it most.”

Steve Hyde, President & CEO, Genesee County Economic Development Center said, "Sustaining the next generation of dairy farmers is critically vital to Genesee County's agri-business economy. Thanks to the high-quality milk produced by New York State dairy farmers a critical mass of dairy processing companies such as O-AT-KA Milk, HP Hood, Upstate Niagara Cooperative, Dairy Farmers of America, and Yancey's Fancy, now employ over 1,000 people in Genesee County and these companies continue to grow and flourish. We commend Senate Majority Leader Schumer's focus on extending the Dairy Margin Program and supporting our region's family farms and agri-business operations. Price increases and inflationary pressure make the DMC Program especially important, as our dairy farms do not set prices for the products they produce, and too often are paid less than the costs to sustain their farms."

Genesee County Legislature Chair Rochelle Stein and owner of Stein Farms dairy said, “The value of the DMC program to our Genesee County dairies is vital especially as a top 5 NYS dairy producing county, the DMC program is critical for our entire robust agriculture economy.  All dairy farms are in a tight crunch now as the cost to produce milk is higher than the price paid for that high quality, fresh, local milk.  Farmers are not allowed to set a price for the milk we produce, the federal government has that role. This risk management tool offered to dairy farms is especially important for large, small and midsized dairies because it provide vital price support to the County’s dairy industry.  Sen Schumer’s push to avoid a dire “dairy cliff” scenario is crucial for our family dairy farms, consumers, and our dairy farmer owned milk cooperatives and dairy partners like HP Hood and Yancey’s Fancy.  DMC program is set to expire at the end of September, Senator Schumer is pushing to extend and protect this program for our local dairies and those all throughout NYS, to ensure the support and safety net they rely on.  We appreciate to value Senator Schumer places on our vital rural and robust agriculture economy, family farms and the community members that work at our dairy manufacturing companies.”

Schumer explained the ‘dairy cliff’ refers to the expiration of the Dairy Margin Coverage (DMC) program, a risk management tool that offers protection to dairy producers when the difference between the all-milk price and the average feed price (the margin) falls below a certain dollar amount selected by the producer. If Congress doesn’t pass a 2023 Farm Bill and the DMC is allowed to lapse, the dairy industry would be the first impacted, as dairy farmers would lose out on monthly payments through the DMC, whereas farmers participating in other support programs are paid just once per year around harvest time. If we were to “go over the dairy cliff” that would mean:

• An end to monthly price support payments to dairy farmers who participate in the Dairy Margin Coverage program
• Massive supply chain disruptions that could reduce access to fluid milk, increase the price of dairy products by more than double current prices, and have lasting impacts on farmers, families, and food banks
• Billions of dollars in avoidable federal government spending

These impacts would be felt especially hard in the Finger Lakes and places like Genesee County, which is New York’s #5 milk producing county and according to the most recent USDA Census of Agriculture, #67 in America. Genesee County sells about $114 million worth of cow’s milk every year, representing roughly 48 percent of all profits from agricultural products sold in the county. Genesee County is home to 28,000 dairy cows and markets over 70 million pounds of milk annually for use in milk products, such as milk powder, protein powder, and fluid milk. Schumer said that the Finger Lakes is vital to New York’s dairy industry, and is the home to over 700 dairy farms.

Har-Go Dairy is a second and third-generation family owned farm that is home to 250 dairy cows in Genesee county. The Gould family, which owns Har-Go Dairy, considers the DMC to be vital, especially during years like 2023 when milk prices are lower and margins are significantly tighter. John Gould is not only one of the 340 dairy farmers who make up Upstate Niagara Co-Op, but also the chairman of the cooperative, which supplies O-AT-KA Milk Products Cooperative, Inc. in Batavia, NY. O-AT-KA Milk Products Cooperative, Inc., with over 400 employees and majority owned by Upstate Niagara, considers the monthly dollars coming from the DMC to be critical for their farmers and producers across the region.

Failing to reauthorize the Farm Bill and going over the dairy cliff would not only negatively impact payments to dairy farmers, but it would also cause massive market disruption for larger factories as well as smaller dairy operations like Har-Go Dairy, major price increases for consumers, and avoidable increases in government spending. Schumer explained that the only way to avoid going over the dairy cliff is for Congress to come together in a bipartisan fashion, as they have always done, to reauthorize these programs in the 2023 Farm Bill. The senator explained that the Farm Bill is usually enacted every five to seven years. The current Farm Bill, which was passed in 2018, is set to expire on September 30th, 2023.

The dairy industry would begin to see severe impacts at the start of the year on January 1st, 2024. If no Farm Bill is passed and the DMC is allowed to lapse, the country would be forced to revert back to 1940’s agriculture policy. Farmers would lose the support and protection offered by DMC and the law would require the federal government to stabilize prices by taking milk off the market through milk purchases. The government would be required to purchase milk at a price that is more than double the current market price, which would cost the federal government billions of dollars in otherwise avoidable spending and could result in price increases being passed onto consumers, which would have devastating impacts on consumers and nutrition programs that offer milk and dairy products to people in need. The availability of fluid milk and dairy products could also be impacted; consumers could see fewer options in stores and food manufacturers could see less dairy product availability for products like baby formula, protein powder, and other products that use dairy ingredients. The widespread supply chain and market disruption caused by the DMC’s expiration would have devastating impacts to the dairy industry, farmers, and consumers across the country.

The dairy industry is one of New York's largest contributor to the agricultural economy. According to the New York State Department of Agriculture and Markets Dairy statistics, there are approximately 3,600 dairy farms in New York that produce over 15 billion pounds of milk annually, making New York the nation’s fourth largest dairy state.

Original source can be found here.