Washington Watch Few Takers for Export Incentives

USDA closed the books June 30 on its FY 2005 Dairy Export Incentive Program (DEIP) with almost no activity for the year. During the entire year, USDA never requested bids or awarded bonuses, so no dairy products were exported under the once-popular program. The reason is not much of a mystery. Demand for U.S. dairy products was strong throughout the year, keeping prices high, making government compensation for exporters unnecessary. International milk production was down, and the currency battering suffered by the dollar worked to U.S. producers' advantage, pumping up demand for U.S. non-fat dry milk. U.S. NFDM exports are up 155% since July 1, 2004, when the DEIP fiscal year began.

USDA closed the books June 30 on its FY 2005 Dairy Export Incentive Program (DEIP) with almost no activity for the year. During the entire year, USDA never requested bids or awarded bonuses, so no dairy products were exported under the once-popular program. The reason is not much of a mystery. Demand for U.S. dairy products was strong throughout the year, keeping prices high, making government compensation for exporters unnecessary. International milk production was down, and the currency battering suffered by the dollar worked to U.S. producers' advantage, pumping up demand for U.S. non-fat dry milk. U.S. NFDM exports are up 155% since July 1, 2004, when the DEIP fiscal year began.

Consumer groups are pressuring USDA to change the way it meets the threat of mad cow disease. The Humane Society of the United States called on the agency to permanently ban the slaughter of downed cattle. Consumer's Union called on USDA to toughen its testing procedures on cattle. Specifically, the group asked Agriculture Secretary Michael Johanns to require USDA to test all cattle over 20 months of age at slaughter and adopt the most accurate and sensitive "Western blot" test as part of its testing protocol in suspected mad cow cases.