November 2002
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Good morning everyone. It's great to be in Southern California, where you can always find exotic cars, movie stars, and fancy clothes and that's just at Herman Brubaker's tribute as outgoing Chairman of DMI. I understand that he will soon appear in his own milk mustache ad showcasing his annual meeting smile. However, I am pleased that he will continue as a Director on the NMPF Board of Directors; I value his counsel and support. We have an expression in New Jersey that "when the fight breaks out, I want Herman on my side!
Some others I'm glad we have on our side are our NMPF Associate Members, who Herman thanked previously. We appreciate your support of this meeting and our industry.
NMPF Chairman Tom Camerlo has just presented a very compelling overview of the many successes that National Milk has had during the past 12 months. I want to thank him for his strong leadership and friendship. I also want to thank our officers, Board of Directors and all of our members for their continued support and confidence. Lastly, I also want to acknowledge the hard work and tireless efforts of the best trade association staff anywhere. I am a very intense and demanding person and somehow they always respond to my numerous challenges. Usually they go well beyond my expectations. Thank you, NMPF Staff.
I am especially proud of the way our members have worked together within NMPF to advocate policies and programs that benefit all farmers, minimize regional differences and create a rising tide that lifts all dairy farmers. We are now well positioned to move away from those past programs that led to so much divisiveness. Unfortunately, because we are experiencing a period of low farmgate prices and enormous hardship in the country, I am concerned that some will once again look at resurrecting issues that led to the divisiveness. The Dixie Chicks say it best in one of their hits: Long time gone. And it ain't coming back. We must, and will remain, united, as we work toward consensus.
We need the courage to resist the mistakes of the past and avoid solutions that do not benefit our entire membership. We need to develop and reposition our policies to correspond to a changing industry, new consumer preferences and a global marketplace. We now have the opportunity to plan ahead and use the present time to plot a strategic course for the future. That's why I'm happy to announce that NMPF will sponsor a new round of Dairy Producer Conclaves in 2004. The Conclaves two years ago were a big success, and a catalyst in creating a successful Farm Bill this year. We are going to repeat past programs that bring producers
together, and the Conclave is a great example.
It hardly seems like it was a year ago when we were just beginning to see the outlines of the 2002 Farm Bill. Some of our elation over the subsequent successes contained in the dairy title of the bill has been tempered by the problems we've had with the implementation of some of its programs. And, of course, no policy measure can make up for the loss of revenue farmers are suffering from a poor marketing environment. Dairy farmers receive more than 90 percent of their revenue from the marketplace. Our farmers depend on consumers, not government policies. And when dairy producers are suffering from a supply and demand imbalance, it affects everything else we do.
Your economic well-being remains NMPF's number one priority, but just like the weather, there's only so much any of us can do about the economy. We are concentrating our efforts on many things that we can control; on things where, if we don't have control over them, they'll have control over us.
For instance, let's talk about the environment. Although it's a huge concern locally, the environmental pressures facing livestock producers are not unique to California. Dairy farmers from coast to coast, of all sizes, are facing intensive scrutiny about the impact of animal waste on the water, soil and air. Tom mentioned that one of our successes in the Farm Bill was securing additional funding for the Environmental Quality Incentives Program. More money is great, but it also helps to have some additional technical assistance for producers as they comply with a complex web of state and national regulations.
That's why I'm pleased to announce that at this meeting, we are unveiling our new NMPF Environmental Best Management Practices manual. The new Dairy Environmental Handbook is intended to help individual dairy operators make sound, science-based choices about how they manage the animal waste from their farms. Our handbook was prepared with input from the USDA's Natural Resources Conservation Service, so we know it reflects the thinking and experience of federal regulators studying this issue.
We are making this guide available to NMPF members free of charge, thanks in part to Philip Morris, which provided us with a grant to help publish the manual.
We are also using our annual meeting to unveil another producer guide, this one focusing on animal care. We all know that the animal rights activists have long criticized certain livestock industry practices. What's unfortunate is that some food retailers, both supermarkets and restaurants, are listening to these criticisms and asking their food suppliers which ultimately means farmers to adhere to certain practices and avoid others.
In order to help answer these concerns, NMPF is now publishing a reference guide on Caring for Dairy Animals. This guide is a joint collaboration with the Dairy Quality Assurance Center. This manual provides a comprehensive list of steps that producers can take to maximize the care and comfort of cows throughout their lives, from calving to culling. This is the same manual that retail food chains, both supermarkets and fast food outlets, will be using if and when they evaluate their dairy suppliers. So, by providing farmers with this manual, we are helping ensure that you will not be denied access to certain markets because of any questions regarding your on-farm animal handling.
I'd like to take a moment to also discuss what we are doing on another issue of great importance to producers, and that is trade. A moment ago, Tom reviewed our three-pronged strategy for dealing with imports of dairy proteins such as Milk Protein Concentrate. But MPC and casein imports are only part of the import story. In fact, while still very high, imports of specialty proteins are down from their peak two years ago, even while imports of cheese and butter products have soared.
In order to keep better track of the movement of all of these products, we started a new publication this year called ImportWatch. ImportWatch, which is available on our website and by email, monitors the trends in the movement of dairy products into this country. We started this publication because often times when we meet with Congress on trade issues, we're asked about numbers: are dairy imports growing, or staying the same? Which categories of products are growing the most? Which categories have quotas, and which do not? ImportWatch helps us answer these questions. We need to base our efforts on the facts, and none of the data in this publication can be disputed.
ImportWatch helped us make the case this summer that in addition to MPC imports, one of the biggest factors in the downturn in prices this year is the surge in American-type cheese imports. Imagine that: we have significant volumes of foreign cheese coming into America, where it is processed into American cheese products. Through the first eight months of this year, American cheese imports were triple the level of the year 2000. What's more, these imports were large enough that the U.S. is in the position of imposing higher tariffs on these products. NMPF has asked the U.S. Department of Agriculture to impose higher tariffs on these cheese imports. We have yet to hear back from USDA, but we are hoping that this Administration will demonstrate some sensitivity to the impact that imports are having on farm prices.
The trade issue, just like environment and animal care, is one of those that really unites the producer community. It's a concern whether you're living here in California, or in Florida, or Wisconsin or Vermont or anywhere else. It also unites dairy operators of all sizes, large and small.
Throughout the Farm Bill debate, and during discussions of other policy issues, NMPF has consistently attempted to avoid taking positions and making decisions according to the size of a farmer's herd. We have striven to treat all farms the same, and to have federal policies take a neutral stance on herd size although of course the government often chooses to be size conscious in programs ranging from the MILC payments to the CAFO regulations. As Tom said earlier, NMPF opposed the inequities in the Farm Bill's direct payment program as it was first proposed. Our message to Congress whether they act on it or not has been very clear: size shouldn't matter. Discrimination based on farm size is no different than any other form of discrimination.
One of the things I've concluded after five years at National Milk is that we need farmers of all sizes in the U.S. dairy sector. Larger producers need the political clout that comes from having small- and medium-size farms across the country. We would be far less effective if our industry were concentrated in just a few states, like some other commodities are. At the same time, smaller producers need larger farms. Larger operators often pioneer innovations and adapt new technologies that others can later share and benefit from. Larger farms in an area help assure that there will be sufficient dairy services, such as feed, implement dealers and veterinary care, available to producers of all sizes.
As the overall number of dairy farms continues to shrink, we can't squander our political capital, our energy and our time in a house divided against itself. We have enough critics already we don't need to have others pick up on and repeat our arguments over what the best size dairy farm is. No one benefits from that kind of internal argument except those opposed to any and all forms of dairy farming.
Another reason we have to learn to work together better is that it takes a unified effort in Congress to get things done. One of the lessons from the 2002 Farm Bill is that dairy farmers, working with producers of other crops, were able to secure a very generous bill thanks to a large coalition effort. Any internal disputes among differing types of agricultural producers would have delayed and probably scuttled the whole deal.
The need for a coordinated, methodical and broad-based political effort has led us to focus this year on improving our grass roots political efforts. Those of you who came to the Town Meeting yesterday were treated to a discussion of the virtues of becoming more active in the political process. And that doesn't mean you have to give money to politicians, or run for office yourself, to get involved. Being active simply means voicing your opinions to your elected officials.
We're making that a bit easier by formalizing our grass roots program into an initiative called Dairy G.R.E.A.T., for Grass Roots Education and Action Team. By working with our member coops, and by giving you resources on the NMPF.ORG website, we are empowering farmers to do a better job of interacting with their congressmen and senators. We need your involvement in the political process to continue achieving other victories.
Let me also remind you that another tool we need at NMPF is to have a strong, viable checkoff program in place. I'm an ardent supporter of the things that Tom Gallagher is doing at DMI. We must maintain a national checkoff because we need the market development and promotional activities that DMI and its local partners are engaged in. The policy initiatives that NMPF advocates in Washington are very important, but they're not the whole picture. We also have a critical need in the industry for the demand- and market-building functions that the checkoff provides.
In fact, NMPF will be working with DMI in the coming year to defend milk's role in the school lunch program. This is yet another great example of where policy and promotion can and must work as a team for the good of the industry.
There is nothing that we can't accomplish if we work together. For example, many people said we couldn't get the import assessment passed after ten years of trying. They were dead wrong, but now many are saying we can't win the MPC/ casein issue. I reject that kind of pessimism and look at it as just another challenge to be met. We will win this issue! It will take a lot of effort and perseverance but what do we have to lose? Just like a famous Garth Brooks song in which he says:
I could have missed the pain but I'd have had to miss the dance.
Ladies and gentlemen don't miss the dance get involved, get energized and help us get our message across to the decision-makers.
It may surprise many of you that I am a big fan of country and western music, which may seem somewhat out of place from some guy who grew up in New Jersey, but appearances can be deceiving. There is a country song by a newcomer Joe Nichols that recently topped the charts. It's called "The Impossible:
Unsinkable ships sink.
Unbreakable walls break.
Sometimes the things you think could never happen,
Happen just like that.
Unbendable steel bends.
If the fury of the wind is unstoppable,
I've learned to never underestimate,
The impossible.
Ladies and gentlemen, I am thoroughly convinced that if we harness the potential and the fury of all dairy farmers and their families that we can indeed achieve the impossible. There is no alternative if we are going to maintain an environment in which dairy farming remains a viable and profitable industry. Let's start by everyone signing the letter that is in your satchel. It will be sent to the U.S. Customs Service, and it asks the agency to oppose the fraudulent MPC imports that are circumventing our tariffs and damaging our domestic milk pricing. No one should leave this meeting without signing the letter and dropping it off at ??? Like the Toby Keith song says, let's have a little less talk and a lot more action.
I pledge to you that all of us at NMPF will continue our vigorous efforts on behalf of our cooperatives and the farmers who own them. There are some people who claim to be champions of dairy farmers, but don't be deceived by idle rhetoric, sensationalism and disingenuous awards. Those won't get the job done actions always speak louder than words. Judge us by our actions and you will discover the truth. NMPF works every day on your behalf, along with your cooperative management. Together, we are the true champions of dairy farmers. We consider it a badge of honor to represent your interests and we look forward to continuing our work on your behalf.
The key to anything in life is persevering. In the confrontation between the fluidity of the stream, and the mass of the rock, the stream always wins not through strength, but through persistence. Our strength is our persistence. Thank you.
