10/03/06 CWT analysis

Doctor Scott Brown says he was skeptical about the long term effects of CWT. Brown is the Livestock and Dairy Program Director for the Food and Ag Policy Research Institute. Brown decided to do his own economic analysis of the cooperative program. BROWN "By looking over the 2004 to 2006 period, I am estimating CWT that added 40 cents to the all milk price relative to what would have occurred without that program." CWT is a farmer-funded program that works for the producer by balancing dairy demand with supply, thus stabilizing milk prices at a profitable level for dairy farmers in the U.S. That's accomplished through a herd retirement program and an export assistance program. BROWN "It kept milk prices from being even lower than we have seen in 2006 adding 60 cents to the bottom line making milk prices higher than what would have been some very low milk prices." 147 thousand cows were removed from production. CWT has been a hit with Idaho producers and Brown says you can't find a better return on investment for the dairy industry. BROWN "We're generating about another 2 billion dollars, an eight to one return on producers investment in that program." Thanks to a CWT assessment increase to 10-cents per hundredweight, a five-cent increase from the initial assessment, CWT will once again be able to fund additional herd retirement efforts and continue the export assistance program. Today's Idaho Ag News Bill Scott