WOOSTER, Ohio — Several major dairy organizations are optimistic about what a newly approved mandatory dairy price reporting program will do for their industry.
The House and Senate agriculture committees both have approved legislation, known as the Mandatory Price Reporting Act of 2010, that re-authorizes mandatory price reporting by the USDA for five years.
For the dairy industry, this means weekly electronic reporting — a process believed to provide more timely and accurate data.
“To make business decisions as dairy producers, we need price reporting that reflects daily negotiated trades, not a volatile and thinly-traded CME (Chicago Mercantile) exchange, where less than one percent of U.S. cheese and less than two percent of U.S. butter is traded,” said Lancaster, Pa., dairyman Rob Barley, who also is vice chairman of the Dairy Policy Action Coalition.
“Under the current system, this market of last resort is captured in the weekly NASS Survey that is a week old by the time we farmers see it.”
National Milk Producers Federation called the decision a success that will ultimately lead to better dairy price reporting.
“NMPF has been working since 2000 to improve the open, transparent discovery of dairy prices, but we’ve been frustrated by the stumbling blocks that have prevented the implementation of mandatory reporting, said President and CEO Jerry Kozak.
“These bills make it clear, in no uncertain terms, that the USDA will have to do what it takes to establish dairy price reporting.”
The measure was equally praised by the Dairy Policy Action Coalition.
“Mandatory price reporting programs ensure producers have access to transparent, accurate and timely information that helps them make the best decisions for their businesses,” said Collin Peterson, D-Minn, chairman of the House Agriculture Committee, in a statement released by the Dairy Policy Action Coalition. He is credited for introducing the legislation.
Want daily reports. While electronic reporting is believed to be an improvement, the coalition still wants to lessen the time interval between when reports are made. Currently, wholesale dairy product prices are reported weekly, while other commodities are reported daily.
According to DPAC, the Senate Appropriations Committee has also included policy to encourage U.S. Secretary of Agriculture Tom Vilsack to consider the 2008 farm bill, which DPAC says already provides the authority for daily electronic reporting, and auditing reports quarterly instead of annually.
Daily reporting will cost more, but some sources say it is manageable. According to a DPAC finding, the cost to dairy processors to conduct daily reporting versus weekly, is an estimated $381 per year, per plant.
The full House of Representatives and U.S. Senate must still approve the electronic reporting policy, before it becomes law.