The National Milk Producers Federation and the U.S. Dairy Export Council applaud U.S. Department of Agriculture Secretary Tom Vilsack for his recent announcement regarding initial allocations under the Dairy Export Incentive Program for the new marketing year July
2009 through June 2010.

“This important action by Secretary Vilsack demonstrates his commitment to continue to offer support for dairy producers at a time when dairy prices are at their lowest in years,” said Jerry Kozak, president and CEO of NMPF.

In order to expedite DEIP allocations, USDA is extending the remainder of the uncommitted bids from 2008-2009, making available 48,176 metric tons of non-fat dry milk, 19,235 metric tons of butterfat and 2,878 metric tons of cheese for the new 2009-2010 DEIP marketing year. These quantities will count toward the new marketing year that began July 1 and ends June 30, 2010.

“We appreciate USDA’s prompt announcement,” Kozak said. “Unlike the short period of time given to exporters under last year’s DEIP announcement, this swift action by USDA will allow us to properly compete with other subsidized exporters. However, it is extremely important that USDA issue DEIP invitations immediately for all allowable categories of dairy products in a manner that maximizes exports so producers receive the full benefit.”

USDA shall continue to work with other agencies to make the rest of the full DEIP allocations (20,025 metric tons of non-fat dry milk, 1,862 metric tons of butterfat and 152 metric tons of cheese) available at a later date.

“The FY [fiscal year] 2008-09 and FY 2009-10 allocations of DEIP could remove more than
1.5 billion pounds of milk from the U.S. market,” Kozak said. “Coupled with actions being taken under our own Cooperatives Working Together program, this will help address, in a meaningful way, the imbalance currently present in our market.”

Tom Suber, president of USDEC, added, “The European Union continues to subsidize its dairy products, while New Zealand’s auction process seems to have spiraled down world prices. We support the elimination of all export subsidies. However, until that goal is achieved and especially in extremely challenging market conditions, we must employ all available tools to assist our industry to compete against the active export subsidy programs of the European
Union.”