April 12, 2021 at 1:40 p.m.

USDA unveils new plan for COVID-19 relief

By Don Wick- | Comments: 0 | Leave a comment

    After reviewing existing COVID-19 relief, the United States Department of Agriculture will take a new approach for distributing additional assistance to farmers and ranchers called Pandemic Assistance for Producers. USDA will rewrite rules for this relief, placing a larger emphasis on small and socially disadvantaged farm operations, specialty crop and organic producers, and support for the food supply chain and renewable fuels. The existing Coronavirus Food Assistance Program will fall within this new initiative, and parts of CFAP may be refined to address farmer needs. The dairy industry is waiting for the implementation of the supplemental Dairy Margin Coverage program which was enacted in December 2020.

Dairy trade concerns with Canada
    According to a new report from the United States Trade Representative’s Office, Canadian dairy quota commitments are hurting United States dairy farmers. The report said the United States “remains concerned about potential Canadian actions that would further limit U.S. exports to the Canadian dairy market.”

Dairy exports to China are recovering
    The recent trade war between the United States and China took a toll on the American dairy industry. However, Krysta Harden, president and CEO, United States Dairy Export Council, said dairy exports to China are bouncing back. “China is a very, very key market for U.S. dairy; No. 3,” Harden said. “It’s a market that has been growing, a market that is important to us, and one that we would like to see improve over time.” Harden said the USDEC has been building partnerships in China to develop products that Chinese consumers want. The demand for health-conscious products is an area of growth. “We’re working with the Chinese Institute of Food Science and Technology on different products and prototypes that might meet that growing demand,” Harden said.

DFA spins off two plants
    Dairy Farmers of America has completed the sale of the two former Dean Foods milk processing plants located in De Pere, Wisconsin, and Harvard, Illinois. A partnership made up of New Dairy Opco, which had acquired the assets from the bankrupt Borden Dairy, and Select Milk Producers is the buyer. The two plants had to spun off as part of an antitrust enforcement action sought by the Department of Justice and the attorney generals of Wisconsin and Massachusetts. DFA acquired the two plants in 2019 after the Dean Foods bankruptcy. Terms of the deal were not disclosed.

DFA income moves higher in 2020
    Dairy Farmers of America reported 2020 net income of $170.6 million. That is up from $83.2 million in 2019. Due the acquisition of a large share of Dean Foods’ assets through bankruptcy, DFA saw its income and sales increase. DFA President and CEO Rick Smith praised the resiliency of its farmer-owners and employees during the COVID-19 crisis. “Despite the challenges, we made solid progress on our strategic goals,” he said.

Bongards report year-end financials
    Bongards Creameries is reporting 2020 earnings of $14.6 million on sales of $815 million. Patronage earnings of $13.4 million resulted in a 20% cash payment to members of 19 cents per hundredweight. Company officials indicate this past year featured many challenges and opportunities. The dairy processor was able to make significant investments in facilities this past year.

Raising taxes for infrastructure can have unintended consequences
    President Biden wants to raise the corporate tax rate to 28% to help pay for his infrastructure bill. American Farm Bureau Federation Executive Vice President Dale Moore said there can be unintended consequences when tax rates are increased. “When tax increases begin, it’s easy for someone to say we’re still several thousand dollars short and then, take another grab,” Moore said. Infrastructure is a priority for farm groups like the American Farm Bureau Federation, and they want to move forward in a bipartisan way to fund infrastructure improvements responsibly. Moore said the devil is in the details. “If taxes are what’s going to pay for this, one of the issues we’ve been hearing about lately is the elimination of stepped-up basis,” he said. “That’s not something we’d consider a win. It could put farmers out of business.”

COVID-19 relief included in Minnesota budget plan
    For the Minnesota legislature, budget work is now the priority. Ag lobbyist Bruce Kleven said the agriculture budget is straight forward. “There are a few new initiatives the ag department put forward on international trade and meat processing,” Kleven said. “We expect the House to include those in their budget, and we’ll see what the Senate does.” Another component of the budget will be pandemic relief. Minnesota will receive federal aid, about $4.8 billion, shared between local and state governments. “The question to be resolved this session is who gets to allocate that?” Kleven said. “The federal stimulus money issued before was done by the Walz Administration, but lawmakers will want a say. It’s a fairly sizeable amount of money.”

Co-op day concentrates on rural development, economic stability
    Minnesota farm cooperative leaders recently met virtually with officials from the state agriculture department and the legislature. Cooperative Network outlined legislative priorities, including tax conformity and broadband infrastructure. Agriculture Commissioner Thom Petersen addressed the group, saying mental health issues are still a concern. “You have to remember that before prices were good this year, we went through five or six years of down prices and farmers ate into their equity,” Petersen said. “We have over 1,000 farmers in mediation and that leads to quite a bit of stress.”

Cheese, butter production rises
    USDA’s February Dairy Products Report said American cheese production increased more than 5% from one year earlier. Butter production rose 2.2%. The production of non-fat dry milk increased more than 21%. Skim milk powder declined over 20%.

World Dairy Expo comes to terms with Dane County
    World Dairy Expo will remain in Madison, Wisconsin. Due to COVID-19 protocols, Expo officials were considering other venues. The dates for the 2021 show are Sept. 28-Oct. 2.

Holz-Clause to temporarily lead Morris campus
    University of Minnesota-Crookston Chancellor Mary Holz-Clause will be the acting executive chancellor for the campuses at Crookston and Morris for a two-year term. This news comes as Morris Chancellor Michell Behr plans to retire this summer. The search for the Morris campus’ next leader will begin in spring 2022.

Trivia challenge
    Harry Truman is the last United States president that grew up on a farm milking cows. That answers our last trivia question. Jewel Bronaugh is the current United States Deputy Secretary of Agriculture. For this week’s trivia, what is Bronaugh’s home state? We will have the answer in the next edition of Dairy Star.
    Don Wick is owner/broadcaster for the Red River Farm Network, based in Grand Forks, North Dakota. Wick has been recognized as the National Farm Broadcaster of the Year and served as president of the National Association of Farm Broadcasting. Don and his wife, Kolleen, have two adult sons, Tony and Sam, and five grandchildren, Aiden, Piper, Adrienne, Aurora and Sterling.


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