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MN Farmers Union: Dairy Farmers Need Better Price Protections

As milk and dairy feed prices drop, experts said Minnesota dairy farmers need better protections against market fluctuations. (iStockphoto)
As milk and dairy feed prices drop, experts said Minnesota dairy farmers need better protections against market fluctuations. (iStockphoto)
July 27, 2016

ST. PAUL, Minn. — Many Minnesota dairy farmers are having a hard time adjusting to falling milk prices, and the state's farmers union said a revised federal insurance plan isn't helping.

Farmers signed up for the Dairy Margin Protection Program - or MPP - to protect them from fluctuating differences between milk and feed prices. Over the last two years, milk prices have fallen by more than 40 percent, but the price of feed has also gone down - preventing farmers from collecting MPP payments.

Doug Peterson, president of the Minnesota Farmers Union, said the insurance program has not been performing the way dairy farmers expected.

"The bottom line is farmers have signed up for that, they've paid in $70 milllion in this Margin Protection Program,” Peterson said. "There's only been $1 million paid back. I would call that a catastrophic failure."

The current enrollment for the Margin Protection Program opened in July and runs through the end of September. According to Peterson, the National Farmers Union will talk with members of Congress to propose changes to the program later this year.

If the insurance program stays as is, Peterson said, it could lead to more dairy farmers forced to either leave the industry or consolidate with larger corporate farm operations.

"We can't lose any more farmers,” Peterson said. "The average age of farmers is 58 years of age in Minnesota; nationally about 56. You can't concentrate food production in the hands of a few. That doesn't work, and it's not good national policy."

He said the program could better help farmers by including a more streamlined way for them to recover some of their production costs.

Brandon Campbell, Public News Service - MN