Upload
tori
View
31
Download
0
Tags:
Embed Size (px)
DESCRIPTION
Current Issues in Dairy Policy Hal Harris, Clemson University ERS Dairy Policy Workshop. Washington, DC September 2002. Dairy Programs in 2002 Farm Bill. DPSP Extended DEIP Extended MILC Created (through FY95). Other Dairy Provisions. Promotion Assessment, Imports Fluid Milk Promotion - PowerPoint PPT Presentation
Citation preview
Current Issues in Dairy Current Issues in Dairy PolicyPolicy
Hal Harris, Clemson UniversityHal Harris, Clemson UniversityERS Dairy Policy WorkshopERS Dairy Policy Workshop
Washington, DC
September 2002
Dairy Programs in 2002 Farm Bill
DPSP Extended DEIP Extended MILC Created (through FY95)
Other Dairy Provisions
Promotion Assessment, Imports Fluid Milk Promotion Mandatory Price Reporting Indemnity Payments Studies
Other Provisions
Conservation, Environment Feedgrain, oilseeds Energy Disaster Relief
Federal Orders Ignored
Pooling Higher of III or IV Number of Classes Imports/Exports
Interrelated Issues
Support price level Program cost WTO compliance Tilt Equity Efficiency DPSP and MILC? Payment Limits
Support Price Level
Is $9.90 too high?
Program Cost
Is $2.0-$3.0 bil/year too high?
CCC Dairy Program Cost
-$250$0
$250$500$750
$1,000$1,250$1,500$1,750$2,000$2,250$2,500
94 95 96 97 98 99 00 01 02 03
$M
illio
ns
WTO Compliance
$19 bil Amber Box Limit Dairy is Largest Component ($4.3 billion
in 1998) By 2005 Dairy Contribution Could Approach $6 bil.
Tilt
Little Room to Maneuver
Equity, Efficiency
MILC Penalizes Most Efficient Operations, Regions
Operations With Over 500 Cows Lose Money ($.20-$.30 decline in price)
Retards Loss of Small Farms
Farming the Program
MILC returns $200-$300/cow You do the arithmetic
DPSP plus MILC
Cumulative Effect
Result
High Production, Low Prices Considerable CCC Purchases Higher Program Cost
“Stephenson’s Irony”
Results of the Program – Prove the Need for It!
Payment Limits
Crop Farms, Nominally– Countercyclical $65,000– Direct $40,000– Market Loan, LDP $75,000
$180,000
But 3-Entity Rule, Certificates, No Effective Limit
Dairy Limit Per Farm
$24,000
Winners– Small dairies– Upper midwest– Consumers– Processors
Losers– Large dairies (over 500 cows)– Taxpayers
“Is this policy”Respected Cornell Dairy Economist