Letter to Senate Agriculture Committee Leadership to Extend the Milk Income Loss Contract (MILC) Program

September 27, 2005

Dear Chairman Chambliss and Ranking Member Harkin:

America’s family farmers and ranchers face critical challenges to extend their prosperity. One of the most hard pressed sectors of agriculture today for family farm sized operations is the dairy industry. That is why the National Grange strongly urges you to immediately support legislative and budget measures to extend the Milk Income Loss Contract (MILC) program until September 30, 2007. Founded in 1867, the National Grange is the nation’s oldest general farm and rural public interest organization. Today the National Grange represents individual Grange members who are affiliated with more than 2800 local, county and State Grange chapters across the nation.

At the 138 th annual convention of the National Grange, held last November in Rochester, NY, the Grange delegates from across the nation adopted the following policy position on the Milk Income Loss Contract program.

“The federal government should extend MILC past the September 2005 cut off date with the intent of supporting dairy farmers during times of low prices without encouraging increased production”

We are aware that the Fiscal Year 2006 Budget directs your committee to find $3 billion in savings over the next five years through the reconciliation process. Without question, finding this amount of budget savings will be an extremely difficult task. However, in the view of the National Grange, failure to extend the MILC program is the wrong approach to dealing with this difficult problem. Instead, we urge you to work together, and with your colleagues in the Congress who care deeply about the fate of our nation’s family dairy farming operations, on a bi-partisan basis to extend the Milk Income Loss Contract (MILC) program through the remainder of the current Farm Bill.

Since the MILC program was first included in the 2002 Farm Bill, it has been extremely helpful to dairy producers especially when farm milk prices fall below the target price established in the law. In 2002 and 2003 farm milk prices were at historic lows and the MILC program provided a safety net for producers during difficult financial times. Currently, farm milk prices have improved, but if they were to fall in the future, the MILC program would ensure that our dairy farmers would receive payments to help cover their production costs. The MILC program not only provides important financial support to dairy farmers, it is critical to the economic well-being of many rural communities.

We look forward to working with you on this important matter. Your prompt attention is needed to assure that thousands of family dairy farmers across the nation receive the financial support that they deserve. We greatly appreciate your leadership and hard work on behalf of America’s family farmers and rural communities.

Sincerely,

Leroy Watson, Legislative Director
National Grange of the Order of Patrons of Husbandry