NMPF says Bennet amendment to Senate Farm Bill Dairy Program costs farmers $400 million

When the Senate Ag Committee 2012 Farm Bill process resumes, Senator Michael Bennet is expected to offer an amendment to make changes to the dairy title of the legislation.

According to a statement released by the National Milk Producers Federation (NMPF), the amendment would cost dairy farmers more than $400 million in addition expenses.

NMPF President and CEO Jerry Kozak says Bennet’s amendment would increase the cost to dairy farmers on the margin insurance program “by as much as a staggering $429 million in the next five years.”

The dairy portion of the Senate farm bill proposal replaces three existing dairy programs, and uses the budget savings from those to help pay for the Dairy Producer Margin Protection Program. A basic, $4 level of margin insurance is free to farmers, although there are up-front administrative fees tied to the volume of milk insured under the program. If a farmer wishes to insure a larger margin, the premium rates increase with the level of protection.

“Senator Bennet’s amendment would raise the overall price tag of the insurance program to farmers. Dairy processors say they agree with the concept of margin insurance, but with this amendment, they’re jacking up the cost of the program to farmers by millions of dollars a year, and once again shifting the risks of the marketplace away from them, onto the backs of our hard-working dairy farmers,” Kozak said.

Tuesday, NMPF wrote a letter to members of the Senate Agriculture Committee to oppose the Bennet amendment, reminding them of “the hard work that senators on both sides of the aisle have put into the completion of this mark. Please don’t allow last-minute amendments such as this to thwart all the effort that has been made to this point.”

Source: NMPF