KINZERS, Pa. — Supply management has long been an uncomfortable idea for U.S. dairy farmers, but it might be just what small milk producers need right now.
At least that’s what Wisconsin Farmers Union leaders told Pennsylvania dairy farmers during a June 27 visit to SpringWood Organic Farm in Lancaster County.
“We don’t think we can export our way out of this problem,” said Sarah Lloyd, a Wisconsin dairy farmer and director of special projects for the Farmers Union.
Lloyd and government relations director Kara O’Connor are touring the country to build support for the Dairy Price Stabilization Plan, which functions a bit like a luxury tax in pro sports leagues.
Based on market demand, an annual rate of milk production growth would be set between minus-3% and 3%.
Farmers pay a fee if they expand beyond the threshold. That money goes into a pool to be distributed among the farmers who stayed within the growth rate.
The Farmers Union asked dairy economists Chuck Nicholson of Cornell University and Mark Stephenson of the University of Wisconsin to estimate how farmers would have fared if this policy had been in place from 2014 to 2020.
The researchers found that the program would generally have increased average milk prices and net farm operating income while reducing market volatility.
Supply management systems of some sort are already in use in Canada, Maine and several large U.S. dairy cooperatives.
Several dairy groups pushed for national supply management in the early 2000s, and Sen. Bernie Sanders, now a Democratic candidate for president, introduced a form of the plan in Congress in 2010.
Still, the Farmers Union leaders said the idea is not well known today.
Last week’s event, held on a sunny day conducive to fieldwork, may not have helped much.
The small audience asked few questions, and most left soon after the meeting.
Still, a supply management campaign will be a priority for the National Farmers Union’s September Fly-in, a Washington lobbying event.