Farm Bill negotiations threaten price of milk - WKRN News 2

Farm Bill negotiations threaten price of milk

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MURFREESBORO, Tenn. -

A gridlock in Washington over the Farm Bill could soon cause the price of milk to skyrocket.

According the USDA, the Farm Bill provides funding for services and programs "that impact every American and millions of people around the world."

Every five years, U.S. lawmakers rewrite the Farm Bill, which ultimately sets the formula for milk prices.

The conditions of the previous bill were merely extended last year, forcing another debate this year and pushing the country toward another so-called "dairy cliff."

"The Farm Bill protects dairy farmers by assuring a fair price, an equal price," said Dr. Warren Gill, director of Middle Tennessee State University Agriculture Department. "It is balanced across the country to make sure that we keep these dairy farmers in business, so that we can keep a fair price, a good price for both the dairy producers and the people out there buying milk."

Two years ago, MTSU unveiled a new $2.7 million, state-of-the-art dairy on 438 acres east of the main campus.

The facility has more than 70 cows that are milked daily.

"We are the only university where our students milk the cows, haul the milk in, (and) process it for our students to drink," Dr. Gill said.

Students, faculty, and staff in the university's Agriculture Department have been closely watching Farm Bill negotiations, most of which include reducing funding.

There are five key issues up for debate including money set aside for the Supplemental Nutrition Assistance Program (SNAP), also known as the food stamp program. Food stamps account for roughly 80% of all farm bill costs.

Cuts could be coming to direct payments as well. The payments, set up as safety nets for farmers, were scheduled to end nearly a decade ago, but were extended by lawmakers twice.

Limitations and expansions on crop and price protection are also being explored. The protections are designed to buffer farmers against unexpected loss like those suffered in natural disasters.

Finally, dairy laws are being debated. Lawmakers cannot agree on if or when to limit milk production. That particular debate doesn't make sense to local dairy farmers like Charles Hatcher.

"The cows have to be milked. There's nowhere for the milk to go. Farmers can't go on strike. You can't poor the milk out. It's a perishable product," he said.

Hatcher is a fifth generation owner-operator of Hatcher Family Dairy in College Grove, Tennessee. The dairy provides milk to four different counties through 45 retail stores and local farmers markets.

Hatcher Family Dairy milk is modestly higher than other brands, but customers are loyal because they trust the local, family-owned company.

If lawmakers cannot reach a compromise on the Farm Bill, a provision from the 1940s would go into effect, essentially removing the safeguards that keep prices stabilized and sending prices soaring on Hatcher Family Dairy milk and all other brands. If that happens, prices could reach $6.00 to $8.00 per gallon.

"We don't want to get too overly priced with our product. We won't be able to afford and purchase that," Hatcher told Nashville's News 2.

"People will not pay $8.00 for a gallon of milk, and so milk production could go down. The whole idea is stability," added Dr. Gill.

U.S. lawmakers have until January 1, 2014, to reach a deal before the outdated provision takes effect.

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