MILC payments and another CWT dairy herd retirement round

Washington Ag April 7, 2009 The financial plight of dairy farmers has Cooperatives Working Together, CWT, conducting another dairy herd retirement round. Members of CWT can offer bids now through May 1st. Several Washington dairy herds were retired in the last round. Chris Galen, Senior Vice President of Communications with the National Milk Producers Federation says there are some changes for the bidding this time. Galen: “Number one, you are eligible to bid in this round if you retired a herd in the past through CWT. Previously we had restrictions that if you participated you couldn‘t go out and start milking cows again and then bid to go out again. We are waiving that rule this one time just to maximize the participation level in CWT. The other thing is that we have a mechanism intended to keep farms out of production for a year. If your bid is accepted you will be paid 90% of your payment up front once your cows go to slaughter, but the remaining 10% will be escrowed, with interest for 12 months, and will only be paid if we have confirmation then that the farmer and the farm in question where the cows were being milked, have not produced milk commercially for 12 months.” Galen says since the value of cows and heifers has dropped dramatically, the price levels of bids accepted will be much lower than in recent years. Federal Milk Income Loss Contract, or MILC payments, are also going out to eligible dairy producers, as low prices have triggered that USDA program. I’m Bob Hoff and that’s Washington Ag Today on the Northwest Ag Information Network.