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Dairymen plead with Vilsack
Wearing red shirts to symbolize their operations drowning in red ink, local dairymen made a dire appeal to U.S. Secretary of Agriculture Tom Vilsack to do something - and quickly - about rescuing milk producers during his Aug. 26 appearance at the Stanislaus County Agricultural Center west of Ceres.

Vilsack, a member of President Obama's cabinet and former governor of Iowa, listened to farmers explain their financial woes and stress the need for enhanced government pricing. He said more help will come in October but for many, the help can't come fast enough.

Visack's Ceres visit was part of his nationwide Rural Tour with Deputy Secretary Kathleen Merrigan at the request of Rep. Dennis Cardoza, D-Merced, who is chair of the House Agriculture Subcommittee on Horticulture and Organic Agriculture. Also on hand was California State Food and Agriculture Director A.G. Kawamura. About 300 persons heard the secretary field questions in person and about 300 in an adjacent building by closed circuit TV.

The California Dairy Women estimated that for every 500 cows, a dairy will lose approximately $50,000 per month as a result of the recent collapse in milk prices.

Vilsack explained the efforts taken so far to secure the price of milk, which has dropped more than 50 percent in a year's time. The support price paid by the government for dairy products that could not otherwise be sold on the open market was recently raised for the first time in almost three decades. Additionally, bankers are being persuaded to assist farmers with loans, and school nutrition programs are being urged to purchase milk, but producers say more needs to be done.

Cardoza shared that his office frequently hears the frustration of dairymen in his district who don't get enough money for the milk they produce. Dairy operator one after the other shared the microphone to give Vilsack some suggestions, mostly calling for changes to the way milk is priced.

Linda Lopes, president of the California Dairy Women, who helps run a Turlock family dairy, thanked Vilsack for raising the milk support prices but called for it to be raised higher, longer and floored.

"It's not a simple thing to do what you've asked me to do," Vilsack told Lopes.

Unfortunately for local dairymen, Congress is out of session until Sept. 8 and cannot begin to draft new legislation until then. To compound the problem, the USDA is out of purchasing authority, and lacks funding for any new programs until the new fiscal year begins on Oct. 1.

He said the USDA has worked with loan programs and banks to buy time for farmers until help comes. Vilsack outlined the ongoing efforts of the U.S. Department of Agriculture to create internal and external advisory groups to research and brainstorm what needs to be done to create long-term price stability in the market. He said that, once the industry can decide upon what needs to be done, the USDA can move forward with a plan. Coming up with remedies for the plight of dairymen would be a much easier task, said Vilsack, if "the dairy industry was consistent about what they want. It's seen different regionally."

Dairymen thanked Vilsack for what's been done for Valley growers - including an infusion of $822 million of the recent Economic Stimulus package - to support California agriculture. But as one speaker noted, California dairymen are losing $36 million per day.

Ray Souza, president of the Western United Dairymen and owner of Turlock's Mel-Delin Dairy, told Vilsack that the value of the California dairy herd has fallen $2.5 to $3 billion and that farmers "don't have a lot of equity left" to operate upon.

"We need to do something," said Souza. He suggested that the USDA purchase surplus cheese to be moved to food banks across the nation where shelves are empty. Souza said by moving 100 million pounds of cheese the prices would be stabilized. Vilsack took notes but said Congress needs to free up more money or, because of the "pay go" policy, cuts would have to be made in other ag subsidies.

Vilsack acknowledged how grave the situation has become with dairies suffocating financially. He recently met with the widow of a dairyman who committed suicide and left seven children behind.

After Vilsack left the room, red-shirted dairymen said they believed the meeting was successful - even if the majority of the questions asked came from VIP guests who were seated in the front rows.

Several impassioned dairymen made a point to ask why there isn't a closer correlation between the market and retail prices of milk. Only recently did the price of milk in stores drop 9 percent, despite 50 percent drops in the value of milk to producers.

Vilsack stated that the Department of Justice would soon hold a series of public hearings on dairy superpowers Dean Foods and Kraft Foods to investigate possible price fixing. Dean Foods saw first quarter profits more than double from $30 million in 2008 to $76.2 million in 2009.

"They're making record profits and we're dying," said dairyman Bob Borba.

In the early 1980s, producers earned 50 cents of every dollar spent at retail. Now, that share is closer to 22 cents on the dollar.

"What they (The USDA) don't understand is that we just want our fair share of the existing price," said dairyman Gary Genske.

Water a grave concern

The topic of water figured prominently at Wednesday's gathering. Much of what was on the minds of those attending is what role the federal government will play in reversing recent bad news about water availability. A biological opinion issued by the National Marine Fisheries Services called for pumping operations to change in the Central Valley Project and the California State Water Project to preserve populations of fish. Cardoza said 10 percent of the water supply - or 500,000 acre-feet - has been cut in areas, particularly on the west side, with some communities like Mendota suffering with a 40 percent unemployment rate.

"Farmers are in food lines rather than producing food," said Cardoza.

While the state and U.S. Department of Interior and its Bureau of Reclamation have control over Delta water policy, Vilsack gave a sympathetic ear. He said the availability of water is an important issue to the Valley as rest of the nation and one that requires a "comprehensive water policy."

"It is a large problem for the nation," he said.

"Water is very, very complicated and I can't believe there's a one-size-fits-all," he said. "In some areas there isn't enough water and in other areas there's too much water and flooding."

Jerry Lasiter told Vilsack that the "wind of change is blowing across California" about water. "Water storage capacity in this state is ridiculous ... we haven't had a dam built in this state in 40 years," said Lasiter. He called for more storage projects and increased conservation, noting that flood irrigation is only 50 percent efficient.

"Why doesn't California get it?" said Lasiter.

Vilsack said state leaders need to formulate a better plan for water storage and seek the assistance of the federal government.

Cardoza added that state leaders are talking about raising the dams at Shasta and Exchecker to increase reservoir capacity as well as build a new dam in the Friant area.

"We gotta do it," said Cardoza. "We've got to build every one of them."

Vilsack acknowleged that Valley production is of great importance to the nation and its health, citing that over half of the nation's fruits and nuts are grown on three percent of all U.S. farmland acreage. The Valley produces a total of 350 different crops. The ag secretary said the ag community and the USDA need to create new markets for specialty crops, such as finding ways to bring more fruits and nuts into the school lunch progams. He also calls for better linking local production to local markets.

"The San Joaquin Valley is the bread basket of the world," said Cardoza. "We are the economic engine of the state's $32 billion ag industry."

Among the first to greet Vilsack in Ceres were four officers of the Central Valley High School FFA chapter. Visack shared with Katy Gaede, Cherise Azevedo, Lisa Corona and Christina Crum a small bit of trivia about FFA: That only 11 percent of membership nationally are from rural communities.

The luncheon began with an introduction of Cardoza by Hughson farmer Marie Assali who touted Cardoza as a friend of agriculture.

Others who attended included county Supervisors Jim DeMartini, Jeff Grover, and Vito Chiesa.

After the luncheon, Vilsack was whisked away by motorcade to a tour of the Durrer Dairy in Modesto and the Del Monte Cannery in Modesto.