Dear Chairman Conaway:
As members of Congress representing Upstate New York's dairy industry, we thank you for your early start to the 2018 Farm Bill process and we are grateful for your efforts to complete the Farm Bill on time. We appreciate you being a steadfast advocate for rural America by pointing out that agriculture has contributed significantly to deficit reduction, and that should be accounted for during work on the new Farm Bill.
New York is the fourth largest milk-producing state in the nation, and in some years has been the third. Upstate New York includes nearly 5,000 family-owned dairy farms totaling more than 600,000 cows that produce roughly seven percent of the U.S. milk supply on an annual basis. These family farmers are the lifeblood of many of the communities we represent and the fresh milk they produce supports many jobs in the agricultural and food manufacturing sectors of our economy.
As you know, the dairy industry in New York and nationwide has faced significant struggles in recent years. Our current trade challenges with Canada are particularly acute in Upstate New York, a major manufacturer of ultrafiltered milk, and our producers continue to struggle with labor costs and challenges. Moreover, milk prices deteriorated significantly last year, causing dairy farmers added pain during an already challenging climate.
Against this backdrop, a top priority for all of us in the Farm Bill will be reforming the Margin Protection Program for Dairy (MPP-Dairy). While this program is fairly new, it has not performed to the expectations of our dairy farmers. In 2015 and 2016, the first two years of the program, dairy producers paid millions of dollars in premium payments but received very little return on this investment, even though last year was a very difficult year for our dairy farmers by all accounts.
Therefore, we are eager to work with you to improve MPP-Dairy to make it more effective and affordable for dairy farmers. We understand that the program's current formula does not fully reflect producer costs, so we are interested in improving the program to better reflect the margins and challenges producers face to provide them a viable safety net for the coming years. We are also interested in looking carefully at the premium rates in MPP-Dairy, especially given the disparity between what producers have paid in and what they have received even during difficult years. Reducing some of the premium rates, especially those targeted to small and medium-sized farmers, could be an important step in helping farmers to better afford more meaningful coverage.
We recognize that there will be budgetary limitations in the Farm Bill process, as there always are, and we stand ready to work with you to craft a Farm Bill that supports all of rural America. For us in rural Upstate New York, dairy farming is one of the most dominant sectors of our region, so a healthier dairy industry means a stronger economy.
Thank you for your consideration. We are eager to work with you.
Sincerely,
Rep. Claudia Tenney
Rep. Elise Stefanik
Rep. John Faso
Rep. John Katko
Rep. Chris Collins
Rep. Tom Reed