A3B-Lancaster Farming, Saturday, March 16, 1991
BATAVIA, N.Y. The
cooperative that represents the
majority of New York State dairy
fanners today (Wednesday) peti
tioned the state to establish an
emergency milk market order set
ting temporary survival floor
prices paid by purchasers of milk
produced by the state’s dairy
farmers.
In a petition filed in Albany
with New York State Commis
sioner of Agriculture and Markets,
Richard T. McGuire, the Region
al Cooperative Bargaining Agen
cy Inc. (RCBA) requested the
commissioner to use his authority
under the Rogers-Alien Act of
1937 tp avert disaster in the state’s
rural economy caused by a sudden
and unprecedentedly sharp fall in
milk prices over the past year that
is expected to continue through
1991. At the same time, the cost of
production incurred by New York
State dairy farms has climbed
steadily and is projected to rise
through 1991.
According to RCBA, current
milk prices already have fallen
below the cost of production for
many New York State dairy far
mers, and hundreds of dairy farms
are at risk of failure in the coming
months. The petition requests a
state-regulated safety net for
prices.
Specifically, the price paid to
dairy fanners for Class I or fluid
milk would not be allowed to fall
below $14.50 for one hundred
pounds of milk and the minimum
price to be paid for Class II milk,
used for manufacturing cottage
cheese, yogurt and other dairy
products, would be $11.50 per
hundred pounds. Dairy farmers
would actually receive a uniform,
or blend price for all their milk of
about $l2 per hundred pounds.
The minimum prices which the
state’s dairy farmers now receive
for their milk are established by
N~
.Y. Ag Agencies, Officials
Support RCMA Efforts
ALBANY, N.Y. — The Reg
ional Cooperative Marketing
Agency’s (RCMA) efforts to raise
prices for dairy farmers have
gained endorsements from several
important sources.
New York’s Joint Commission
on Dairy Industry Development,
several New York State legisla
tors, the New York Farm Bureau
Dairy Committee and the Grange
have expressed support for
RCMA’s efforts to provide an
economic safety net for the state’s
milk producers, RCMA Executive
Director Carmen L. Ross reported
to the Board of Directors during a
meeting March 8 in Albany.
Support focuses on a petition to
Richard T. McGuire, state com
missioner of agriculture and mark
ets, which requests that he estab
lish a statewide marketing order to
set minimum prices on milk by
using his authority granted under
the Rogers-Allen Act. The peti
tion was filed last month by the
Regional Cooperative Bargaining
Agency (RCBA), an organization
in which RCMA is a member.
The commissioner has begun
the legal steps necessary for acting
upon RCBA’s petition, Mr. Ross
reported. On March S, he sent out
notice of the petition. Interested
parties have until March 22 to sub
mit additional proposals to the
commissioner. After that*date he
is expected to announce the
hearing.
RCBA Asks New York State
To Establish Milk Price Survival Floor
government market administrators
under a joint federal and state
marketing system. Prices here are
based on market prices for manu
factured milk in Minnesota and
Wisconsin and are not based
either on market conditions in
New York State or on New York
dairy farmers’ cost of production.
The RCBA petition asks the Com
missioner to establish a single set
of survival prices for the entire
state.
The RCBA issued the following
statement:
“On behalf of all the dairy far
mers in New York State, we are
asking the Commissioner of Agri
culture and Markets to establish a
survival floor for prices paid by
purchasers of milk produced by
New York State dairy farmers to
head off a disaster now looming
for the rural economy of the state.
“Due mainly to market condi
tions caused by the buildup in the
Midwest of huge inventories of
manufactured dairy products by
large food processing companies,
the price of milk in New York
State has plummeted more sud
denly and precipitously in the past
year than at any other time in the
last 25 years. During the past year
as a whole (December 1989 to
December 1990), the price of milk
paid to New York State dairy far-
mers under the federal milk mark
eting system fell by more than 27
percent, and the price is expected
to continue to decline substantial
ly in 1991.
“For many dairy farmers, the
cost of production already far
exceeds the price they received for
their milk. Even lower prices over
a long period will result in the fai
lure of large numbers of the state’s
dairy farmers and will impose
severe hardships on many more.
This will have a devastating effect
on rural communities whose eco
nomies are heavily dependent on
ROMA is working with many
.persons and organizations to
arrange expert testimony for the
hearing on the plight of the state’s
dairy industry. The hearing is a
crucial step in the process,
because the commissioner’s deci
sion on minimum milk prices
must be based on information pre
sented at the hearing.
The RCMA Board of Directors
was also informed that directors of
Upstate Milk Cooperatives Inc.,
an RCMA member which had
expressed opposition to the
Rogers-Alien petition in Western
New York, had voted at a special
meeting to endorse the RCBA’s
Rogers-Alien petition in concept.
Upstate and Niagara Milk
Cooperative Inc. are expected to
submit to the commissioner of
agriculture a petition for the West
ern New York Milk Marketing
Order. This petition should com
plement the RCBA petition.
RCMA is encouraging its mem
bers to write to elected officials to
urge them to notify the commis
sioner that they support RCBA’s
petition and to urge the commis
sioner to act as rapidly as possible.
“Dairy fanners need help in the
form of higher prices, and they
need them now,” Ross said.
RCMA directors also voted to
endorse the concept of federal
legislation that would freeze Class
(Turn to Pago A 39)
dairy farming and ultimately may
result in shortages and higher
prices for consumers.
“The adoption by the Commis
sioner of a survival price will help
continue to guarantee an adequate
supply of reasonably priced milk
for the millions of consumers of
New York State.
‘The Commissioner has ample,
tested authority under the state’s
Rogers-Allen Act to establish a
survival price for milk producers
in order to insure an adequate
supply of this essential and highly
perishable commodity. The New
York State Legislature by statute
originally enacted in the 1930 s
gave the State Commissioner of
Agriculture and Markets the
authority and the mandate to
establish survival prices for the
milk of New York dairy farmers.
Milk orders have been in effect in
Western New York continuously
since 1938.
‘There is no economic reason
why the adoption of the survival
prices requested will have any
adverse impact on consumer
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prices. There has been no decrease
in the retail price of milk paid by
New York consumers over the
past year despite the sharp decline
in prices paid to dairy farmers. In
fact, the retail price of milk has
risen in some areas; the proportion
of the retail price paid to farmers
has declined sharply; and the
proportion going to retailers in the
distribution chain has risen
substantially.
“Given this structure of the
retail price of milk, a minor
change at the farm level should
have no measurable effect at the
check-out counter. Moreover, the
failure to adopt a survival price
will result in widespread farm fai
lures followed by a decline in
supply and a significant shortage
that will cause prices to consum
ers to rise.
“Our request for desperately
needed emergency action is in
keeping with the long-established
public policy of the state to insure
order in an agricultural sector
deemed essential to the state’s
economy and to the public wel-
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fare. The proposed survival price
will be lower than the actual cost
of production of many farmers. It
will be in effect only for 12
months and will sunset automati
cally unless the Commissioner
makes another finding of an
urgent need to continue or modify
it.”
RCBA is a specialized bargain
ing entity set up for the purpose of
petitioning the Commissioner
under the Rogers-Alien Act. Its
membership consists of the Reg
ional Cooperative Marketing
Agency, Inc. (RCMA), a coopera
tive corporation whose member
ship, in turn, embraces approxi
mately 22,000 dairy farmers in the
northeast
Following today’s filing, the
Commissioner must give notice of
public hearing. Following the
public hearing, if the Commis
sioner makes a favorable recom
mendation on the petition, a per
iod of public comment then must
follow before the Commissioner
can rule. The decision-making
process could last several months.
4. ** <•*