(Host) A state panel is looking for ways to help dairy farmers who have been hit hard by a severe drop in milk prices. The Vermont Milk Commission was recently reconvened to find ways to boost farm income.
VPR’s John Dillon reports.
(Dillon) Members of the Vermont Milk Commission say things are bad down on the farm. While wholesale prices were relatively strong in 2001, they fell sharply last December and haven’t recovered.
Prices now are around $11 for a hundred pounds of milk. Many farmers say they need at least $14 to cover their costs of production.
Brad Lawes is a Milk Commission member from Brandon who’s in the fertilizer and feed business. He says his own business has suffered because farmers can’t pay their bills.
(Lawes) “Some of my best customers, some of the best farmers out there, are borrowing money to make their monthly obligations. I’ve been in this business since 1986. I’ve never seen a situation where good farmers, all farmers, are borrowing equity.”
(Dillon) The weather hasn’t helped either. Jim Choinier of Northeast Ag Sales in Lyndon says a wet spring made it so some farmers couldn’t plant corn. Then a drought dried up their crop.
(Choinier) “There’s a lot of stress in the community and if you take the pride away from these farmers, we’ve got a serious issue. It’s a financial issue but it’s also a personal pride issue. I tell you, it’s as serious as I’ve seen it in 30 years. Something has to be done.”
(Dillon) The milk commission is empowered to set wholesale prices to help farmers survive. But the U.S. Constitution prohibits states from acting alone to regulate interstate commerce. The Northeast Dairy Compact was set up by Congress to allow New England states to control prices. But the compact expired last fall. And farmers won’t see payments from a new federal program until next month.
Agriculture Commissioner Leon Graves says the federal program will help, but it won’t be enough to help some farmers survive. Graves wants the commission to investigate the milk industry. He says the prices consumers pay haven’t fallen nearly as much are prices paid to farmers.
(Graves) “The point I want to make is that the retail price roughly has dropped about five cents a gallon, while the farmer pay price has dropped between 25 and 30 cents a gallon. So there’s $81 million out there that’s still in the marketplace, that’s still coming out of consumers in the this state, that’s not finding its way back to farmers at this point in time.”
(Dillon) Graves also says he’ll work with his counterparts in other New England states to see what can be done regionally to boost farm income.
For Vermont Public Radio, I’m John Dillon in Montpelier.