WCAX.COM Local Vermont News, Weather and Sports-Help for Struggling Vt. Dairy Farmers

Help for Struggling Vt. Dairy Farmers

Montpelier, Vermont - July 31, 2009

Vermont has lost 32 dairy farms since January alone. Life on the farm is anything, but easy. And that's because the nation's complicated milk pricing policy has Vermont farmers receiving 97 cents per gallon of milk right now, but it costs them around $1.70 to $1.80 to produce it. That's a business plan destined to fail.

"It's the worst crisis there's ever been in dairy pricing in the state of Vermont-- certainly in my lifetime," Vt. Agriculture Secretary Roger Allbee said.

But Friday's announcement by the federal government that it intends to boost the price it pays through its support system has Allbee hopeful.

"We hope that this recognition that there is going to be some price increase will give people hope that they won't go out of business," Allbee said.

The U.S. Dept. of Agriculture is raising the price it pays farmers for nonfat dry milk and cheese. The increase goes into effect immediately and will remain in place until October. Allbee expects it will mean an additional $1.25 to $1.50 per hundredweight-- still well below what they need to break even.

"It's certainly not going to balance it, but you know, it's five to six to seven dollars a hundredweight that they're losing money on or $100 per cow per month, but it certainly is a positive step," Allbee said. "And I think it's a recognition that a change needs to take place in dairy pricing policy and I know our delegation is trying to do that."

Reporter Bridget Barry Caswell: It's so complicated-- the milk pricing system. Is there anything that can really be done to provide stability, long-term stability?

Sen. Bernie Sanders, I-Vermont: That is exactly the right question. I think that you have to look at the anti-trust situation, give farmers more options where they can sell their milk. What we also need to do in my view is move to a supply management system.

So again, industry experts stress that this is a stopgap measure, more long-term solutions will be needed to keep farms afloat in the future. But for now, this influx from the federal government is expected to boost dairy farmers' overall revenue by $243 million nationwide.

Bridget Barry Caswell - WCAX News