21/03/2011

The US federal government has announced the implementation of a tax of around 7% on importers of dairy products, which the government say will be used to support dairy-promotion programs. The fee has long been sought by American farm groups but dairy importers have expressed dissatisfaction with the tax, which was rejected under George W Bush’s government.

The new tax will see charges of 7.5 cents for every 100 pounds of imported product. Dairy farmers have sought such a tax since 2002, after policy makers decided such a tax could only be implemented if the government determined it did not break trade obligations, as they claim U.S. farmers must pay fees on their dairy products whereas until now imported products have come into the country without any such assessment.

Jerome Kozak, CEO of the National Milk Producers Federation, said has organisation welcomed the decision. He explained, "It's been a long time in coming, but we've finally achieved a degree of fairness in the area of dairy promotion between domestic milk production and imports. Dairy importers, who benefit from the world's largest dairy market, need to help pay to expand that market, the same way that our farmers do."

USDA reveals milk production climbs 2%

The US Department of Agriculture today (21^st March) announced a series of rises across the board in the dairy industry, ranging from price paid to producers to per-cow production. The USDA revealed that milk production climbed 2 percent in February alone. The department has attributed this to increased herd numbers and per-cow output in response to rising prices.

According to USDA figures, production reached 6.83 billion kilograms during February, up from 6.70 billion in 2010. The dairy herd showed an increase of 0.7 percent from last year and the average cow produced 1.3 percent more milk. The average price dairy farmers are paid for 2011 year will be $18.40 per 45kg (100 pounds), an increase of $2.11 on last year.

Kansas-based economist Bill Brooks said, “There is a strong underlying desire to get as much milk as possible from each cow with prices rising. We should see the growth in milk per cow increase the next three months as new cows are added to the herd and fresh forage supplies become available.”