Dairy break for small farmers key to deal

The 2014 farm bill was sealed when negotiators agreed to lower insurance premiums for small dairy farms.

Sen. Patrick Leahy (D-Vt.) said Monday night that he helped orchestrate the compromise over the weekend.  Leahy had been a strong proponent of a Senate “market stabilization” provision in the bill that was meant to curb over production of milk and avoid price collapses.

“This bill is not perfect, and no bill is.  But Vermont farmers, conservationists, and Vermont families can now have the certainty they need to plan for the coming years ahead,” Leahy said.

The House and Senate bills both contained a new type of insurance that would pay farmers when the spread between feed prices and milk prices falls below a set level.

Supporters of stabilization worried that the insurance without supply management could create incentives to overproduce milk, causing prices to plummet. Speaker John Boehner (R-Ohio) and companies that use milk to make ice cream, yogurt and cheese opposed the production controls however. 

Leady’s office said that during talks, Leady had offered a proposal designed to limit margin protection for large farms by capping payments at $1 million and to create higher premiums for herd of more than 2000 cows. That was rejected but Leahy’s support was won after small farmers were given a premium reduction and large farmers were given an increase.

“This will keep this program focused on the needs of smaller dairy farms,” Leahy said.

The compromise, which also includes a provision allowing the Agriculture Secretary to buy up some excess supply, has won the support of the National Milk Producers Association.