Ag Secretary Tom Vilsack recently told a group of farmers, processors, and ag leaders he does not believe the U.S. dairy industry would benefit from a Canadian-style supply management system.
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He says, “Some folks have suggested that we replicate what is currently taking place in Canada with the supply management system, and certainly, the dairy farmers in Canada do quite well under that system. Here’s the problem, and here’s the political reality of that system, it’s that consumers end up paying significantly more for dairy.”

Vilsack says consumers pay a dollar or two more for a gallon of milk and cheese prices are higher in Canada, forcing consumers to pay for farmer support. “And one of two things happens. Either they encourage their politicians not to vote for it, which may happen, or they may decide not to buy the product.”

Vilsack says there’s a lot more competition for food and drink than there was five or ten years ago, so the pricing of products, including dairy products, becomes important.

Vilsack made his comments during a recent discussion with Wisconsin farmers, processors, and agriculture group leaders.

Fonterra Cooperative Group, the world’s biggest dairy exporter, raised its earnings forecast for the second time in three months after a strong first quarter driven by demand for protein products.

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