A34-Lancaster Farming, Saturday, February 22,198 C
Why the buyout program will work
INTERCOURSE Will the herd
buyout program work?
Theoretically, an Eastern Milk
Producers economist told a group
of producers at the co-op’s annual
informational meeting.
Joseph Mathis, Eastern’s
Manager of Economics and
Government Relations, stated that
the buyout’s goal of removing 12
billions pounds of milk from the
market can be achieved because it
requires participants to stay out of
dairying for five years.
During the five years of non
production which are required, the
dairy situation will continue to
change drastically. New
technology will be available which
will have to be incorporated and
learned. These advances are ones
which would normally be in
corporated as they became
available on the market.
New items such as growth
hormones, isoacids, embryo
technology, and on-farm
ultrafiltration and blanching will
be more common. Cropping
changes will continue and market
conditions may not be attractive
due to lower prices and adequate
supplies.
To return to the business, a
participant would have to reinvest
in dairy animals and equipment.
Present equipment would need
rehabilitation or modernization
after disuse for five years. These
total costs of restarting after a
buyout contract expires are ex
pected to be high enough to
discourage reentry in dairying.
In addition, bidders can sup
posedly expect to be as well off
financially outside of dairying,
with the addition of a nonfarm
income, as in dairying, said
Mathis. That’s why the dairy herd
buyout program will work, Mathis
explained.
The dairy herd buyout or milk
termination plan is only one
segment of the dairy title of a
larger bill known as the Food
Security Act of 1985. Mathis went
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on to highlight the other topics
included in the dairy portion of this
bill.
One provision provides for a
study to determine if casein im
ports interfere with the support
price program.
It also allows casein producers to
purchase dried milk powder that
the government purchased as
surplus with the provision that
casein will be the only product
made from the powder.
Mathis pointed out an additional
subject covered is the creation of a
National Dairy Research En
dowment.
This provision gives the
secretary of agriculture authority
to place up to $lOO million from the
Commodity Credit Corporation in
an endowment. The interest from
the endowment will develop new
dairy products and processing
techniques.
Joseph Mathis, Manager of Economics and Government
Relations for Eastern Milk Producers Cooperative.
This Act also looks to the future
with the creation of the National
Commission on Dairy Policy. This
Commission will be composed of 18
dairy farm organization leaders
who will determine the type of
program necessary when the
current bill expires in 1990.
Mathis also informed the group
that the bill provides for the ex
tension of the government donation
program. The act also creates a
dairy export incentive program,
which allows the government to
sell surplus dairy products to
exporters on bid basis in an at
tempt to stimulate a commercial
export market.
After providing details on the
dairy herd buyout program,
Mathis went on to discuss the
InTiqiMwrrA I
Model 1302 ■ Two row,
with 300 poly tank and canopy
segment of the bill Which attempts half will be used by the military
to minimize the effect of the buyout ar, d i* l ex P°rt programs,
on the other livestock producers. “The entire picture is com-
Mathis noted that one buffer is plicated, and will require a good
the requirement that the USDA deal of searching before any
purchase 400 million pounds of beef decisions are finalized. Mathis
above the normal amount. Half of concluded. He suggested that those
these purchases will be used for interested in the program contact
domestic programs and the other their extension agent or the ASCS
office in their area.
York extension meeting planned
YORK - The 69th annual
meeting of the York County
Agricultural and Home Economics
Extension Service will be held
Friday evening, March 14, 1986 at
WisehavenHall.
The highlight for the evening will
be Marcia Bowers, Storyteller She
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