The Milk Cliff, And The Scary Thought Of Paying A Fair Price For Dairy

With the Farm Bill set to expire on December 31st, U.S. milk prices may rise to as much as $6 to $8 per gallon in the first half of 2013.Image: "I Love Lucy"

With the Farm Bill set to expire on December 31st, U.S. milk prices may rise to as much as $6 to $8 per gallon in the first half of 2013.
Image: I Love Lucy – “How Now Brown Cow” (1956)

U.S. citizens are outraged by the thought of paying 7 to 8 dollars for a gallon of milk, but who is to say that’s expensive?

The USDA’s Milk Income Loss Contract Program (MILC), administered by the Farm Service Agency (FSA), is meant to “compensate dairy producers when domestic milk prices fall below a specific level.” This is a fancy way of saying that the government will subsidize dairy farmers with “milk checks” in the case of falling domestic milk prices.

  • The Farm Bill was last re-authorized in 2008. It included everything from farm commodity to food stamps to yes, the MILC.
  • The Farm Bill expired in September 2012.
  • The “milk checks” expired.
  • The Farm Bill was detached from end-of-year fiscal cliff negotiations in order to avoid further delay.
  • If no re-authorization of the Farm Bill is made by the end of 2012, then January 1 will force the USDA to revert to the last permanent Farm Bill – dating back to 1949.

Under the outdated Farm Bill,  the government would be forced to purchase milk from dairy farmers according to dairy farm production costs in 1949 – when production was done by hand. Prices would trickle down to consumers, raising milk prices from $3.65 to anywhere between $6 to $8. The “milk cliff,” if you will.

The bill would also leave out mandatory coverage for U.S. soybeans. In 2010, the U.S. exported 56% of its soybeans to China, but word of U.S. drought and price increases has already forced China to make the largest cancellation of U.S. soy in 14 years.

The “milk cliff” is a wake-up call to how much our nation truly depends on government subsidies for food production. Perhaps living in 1949 can teach us a thing or two about the real labor that goes into producing our nation’s food.

Still think $8 is expensive for a gallon of milk? You pay more for apples.

Milk isn’t water, and we need to stop treating it like it is.


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