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Dairy Industry

 New Jersey’s dairy industry is an important part of the state’s agriculture, not only contributing wholesome, locally produced milk and milk products, but also creating demand for field crops used as feed and for farm equipment and other industry support sales; and

WHEREAS, recent years have seen severe and protracted depressed market prices for milk, combined with periodic spikes in input costs, which have resulted in severe economic hardship for New Jersey dairy farmers; and

WHEREAS, although prices received for milk by dairy farmers have recently trended upward, the history of dairy pricing suggests a downward cycle should shortly follow, bringing new economic hardship on the dairy industry in the state; and

WHEREAS, the Department has frequently visited the issue of New Jersey dairy prices, and has found implementing solutions to the problems difficult for the following reasons:

  • New Jersey is a “milk-deficit” state, whose dairy farmers produce less than 10 percent of the milk processed at its four major Class 1 processing plants;
  • Surrounding states and even states as far away as the Southwestern United States sell milk into New Jersey, either as raw milk being sold into processing plants or as packaged fluid milk and milk products;
  • The existing Federal Milk Marketing Order, a relic of the Depression era, dictates prices to be paid to farmers in various “zones” of the country, resulting in the ability of New Jersey’s Class 1 processors to reach into nearby areas outside New Jersey’s higher-priced “zones” to procure milk if they deem the cost of New Jersey farmers’ raw milk too high;
  • Attempts in the past to create more-favorable treatment of New Jersey dairy farmers than for those in nearby areas outside our higher-priced zones have met with resistance, including legal action, by organizations representing milk dealers in other states; and

WHEREAS, the New Jersey Congressional Delegation, along with Congressional Delegations throughout the Northeast, can be a major force for change to the federal milk marketing order if they work together as a bloc of major milk-producing and milk-consuming states; and

WHEREAS, emerging opportunities to process New Jersey-produced milk within the state can provide the state’s dairy farmers with a chance to earn significant premiums over the Federal Milk Marketing Order prices; and

WHEREAS, as with all agricultural products, the return to the farmer for milk and milk products is greater the further into the marketing chain the farmer controls the ultimate packaging and sale of the milk his farm produces.

NOW, THEREFORE, BE IT RESOLVED, that we, the delegates to the 98th State Agricultural Convention, assembled in Atlantic City, New Jersey, on February 6-7, 2013, do hereby strongly urge the New Jersey Department of Agriculture to do the following:

  • Work with the New Jersey Congressional Delegation and interested federal lawmakers from other states to restructure the Farm Bill and Federal Milk Marketing Order system in order to create a program that better fits the modern milk market for New Jersey dairy producers.
  • Enthusiastically support projects that can offer New Jersey dairy farmers significant premiums for their milk, helping to reverse the cycles of low prices affecting dairy farm viability in this state.
  • Investigate the feasibility of establishing projects in which one or more dairy farmers can work toward marketing value-added products that can be processed, packaged and sold by the farmer, as opposed to the farmer selling milk to another entity, thereby giving the farmer value further into the market chain.
  • Investigate the feasibility to establish anaerobic digestion units which will utilize high moisture dairy farm, dairy industry, agricultural and human food waste streams for the production of bio-gas for a locally produced energy source and digestates which could be used as managed soil nutrients for agricultural production to create an additional revenue stream and good dairy management practices.

BE IT FURTHER RESOLVED, that we strongly urge continued sufficient funding be provided to the Division of Animal Health to enable it to continue valuable services to the dairy industry, as well as all others involved in animal agriculture.

BE IT FURTHER RESOLVED, that we direct the Department to work with other appropriate agencies and groups to explore the possibilities of farm-point pricing, which is the point of ownership transfer for quality Grade A farm milk at the time the milk truck leaves the farm premises.

BE IT FURTHER RESOLVED, that we support the efforts to ensure that a free, competitive and open market exists for all milk producers within the Federal Milk Marketing Order.