• Plain Talk

• Quality Watch

• Dairy News

• John Kronemeyer Receives Distinguished Service to Agriculture Award

• MMPA Honors 35-year Members at Annual Meeting

• General Manager's Report to the Delegates

• Resolutions

Grassroots Support Needed for New MPC Legislation By Elwood Kirkpatrick President

New legislation has been introduced to the House and Senate which would create a Tariff Rate Quota (TRQ) on imports of milk protein concentrate (MPC) and casein.

On March 6, 2003, the Milk Import Tariff Equity Act (MITEA) of 2003 was introduced by Senators Larry Craig (R-ID) and Mark Drayton (D-MN), and Representatives Don Sherwood (R-PA) and David Obey (D-WI). Introduction of the identical bills by both parties is intended to garner bipartisan support throughout the legislature. At press time, Senate Bill S-560 had 15 cosponsors and House Bill HR-1160 had 55 cosponsors. 

The MITEA legislation puts a TRQ on MPC and casein which was not established during the 1994 General Agreement on Tariffs and Trade (GATT). At the time, the technology to mass produce MPC was not available. New technologies have enabled businesses in foreign countries to produce MPC for export and sale to U.S. companies. The new bills are designed to restrict the flow of MPC and casein in a GATT legal manner.

Over the past eight years, MPC imports have more than doubled from 111 million pounds between 1995 and 1997 to about 266 million pounds in the two-year period of 2000-2002. The National Milk Producers Federation estimates that dairy farmers as a whole have lost an average of $150 million per year in income between 1994 and 2000 due to MPC imports.

It is now imperative for the protection of our industry to restrict the flow of MPC into our country. The MITEA legislation will do just that.

I would strongly encourage each of you to call the local district offices of your Congressional Representatives and Senators to urge them to become cosponsors of the Milk Import Tariff Equity Act of 2003. The Senate Bill is S-560 and House Bill is HR-1160. Below you will find the district office phone numbers of every Congressional Representative and Senator from Michigan.

Please contact me in the Novi office if you have any questions regarding MPCs or the MITEA legislation.

District 4:     Dave Camp, Midland (R)                   (800)-342-2455

District 14:   John Conyers, Jr., Detroit (D)             (313) 961-5670

District 15:   John Dingell, Dearborn (D)                 (313) 846-1276

District 3:     Vern Ehlers, Grand Rapids (R)           (616) 451-8383

District 2:     Peter Hoekstra, Holland (R)               (616) 395-0030

District 5:     Dale Kildee, Flint (D)                         (800)-662-2685

District 13:   Carolyn Kilpatrick, Detroit (D)           (313) 965-9004

District 9:     Joe Knollenberg, Bloomfield Hills (R) (248) 851-1366

District 12:  Sander Levin, Royal Oak (D)             (248) 268-4444

District 11:  Thaddeus McCotter, Livonia (R)        (734) 632-0314

District 10:  Candice Miller, Mt Clemens (R)         (202) 225-2106

District 8:    Mike Rogers, Brighton (R)                 (877) 333-MIKE

District 7:    Nick Smith, Addison (R)                    (517) 783-4486

District 1:   Bart Stupak, Menominee (D)              (800) 950-REP1

District 6:   Fred Upton, St. Joseph (R)                 (269) 385-0039

Senator      Debbie Stabenow (D)                         (517) 203-1760

Senator      Carl Levin (D)                                    (800) 851-0030  

Congratulations to Harry Coppernoll Sr., MMPA’s 2002 top quality award winner. Harry and his wife, June, were presented the award at MMPA’s Annual Delegate Meeting on March 18, 2003. Winning MMPA’s top quality award is a very difficult task and truly an outstanding achievement. An article featuring the Coppernoll family will appear in the May 2003 Messenger.

Many producers have asked, “How does MMPA’s top quality award winner achieve outstanding somatic cell and bacteria count levels?” In general, the recurring theme that can be applied to every past MMPA top quality award winner is: cleanliness and consistency.

Cleanliness

Cleanliness is a top priority in all areas of these farms at all times. Every step of the milk production process must be consistently clean, including: dry cow housing, maternity pens, lactating cow housing, milking procedures, milking equipment and the milkhouse. Every step along the way must result in minimum bacterial contamination.

Consistency

Consistency is defined as doing everything right, every time. This can be accomplished in the milk production process by organizing work into “quality processes,” a series of processes designed to achieve the same result every time.

To achieve consistency and continuous improvement, MMPA has established a formalized quality processes to organize work called Total Quality Management (TQM). TQM processes are written for every function performed in the milk production process. They are designed to achieve uniformity in work output, efficiency and accuracy. You can obtain a generic example of these processes from your MMPA Member Representative.

Work can be organized in a variety of ways on the farm. If the producer is the owner/operator and primarily does all the work on the dairy farm along with family, the step-by-step process is not likely written since every family member knows the work routine on the farm. Everything works well until someone is absent due to vacation or sickness and another individual must perform that person’s duties. Unless there are written instructions, the same routines, such as those used for milking, are not likely to be followed.

On larger farms, where the owner is the manager and employees conduct most of the tasks, written work procedures are essential. Communication on large and small farms is a critical ingredient to achieve consistent work performance. Verbal communication, written processes and employee training is critical. Work processes and training need to be in place for every function on the dairy farm, not just the milking parlor.

MMPA’s Milker Training Schools can assist members to train employees and develop a milking process for the farm. Mastitis Management Supervisors Tom Herremans and Gil Johnson teach participants the proper way to milk cows to achieve maximum milk production and top quality milk. They also explain how and why the techniques taught will achieve increased production and lower bacteria and somatic cell counts. Farm managers and owners should attend a Milker Training School as well as their milking employees. Everyone on the farm needs to be aware of proper milking techniques in order to develop the best milking process for the farm.

The MMPA Milker Training Schools focus on consistency in every step of the milking process to achieve the best possible milk production. Every person milking must be consistent in the milking process or cows will not respond with top milk production efficiency. In order for consistency to be achieved, training must be provided to everyone milking on the farm. Milking procedures and processes must be written and easily accessible to all milking employees.

To achieve top quality milk, each farm should set a somatic cell count goal. A reasonable goal could be 100,000 SCC. In order to achieve this goal, continuous improvement of milking processes and procedures is needed. Once the milking processes and SCC goals are established they must be monitored at least once a week to assure the processes are being followed and progress toward the final goal is being made.

Providing rewards to employees for following the processes and achieving the farm goals is a very good way to keep them motivated. Rewarding employees does not necessarily mean increasing wages or giving bonuses. Employees are also motivated by positive feedback from mangers. Most employees want to do the right things and need to know they are doing it correctly.

Establishing written processes for your farm is a step to achieving consistency and attaining goals. A management program is not developed overnight – it takes time. Start your program with one process, such as milking, and then move on to others. MMPA’s Member Representatives can assist producers in creating individualized TQM processes for the farm. Each producer should establish a management team on the farm and include key employees to develop and initiate your program.

For assistance in creating TQM processes for your farm, or for more information on MMPA’s Milker Training Schools, contact your MMMPA Member Representative or the Novi MMPA Member Services Department. Contact information is located on the inside back cover of every Messenger issue.

The Class III price for February is $9.66 per cwt. This price is 12 cents less than last month and $1.97 lower than last year. The Class IV price for February is $9.81, down 26 cents from January and $1.73 less than last year.

MMPA delegates reelected MMPA President Elwood Kirkpatrick, to an at-large position on the MMPA board of directors during the 87th MMPA Annual Delegate Meeting in March.

During the District Meetings in February, the following individuals were also reelected to the board: Earl Horning, District 1; Dick Kleinhardt, District 10 and John Kronemeyer, District 12.

FDA Bans Phenylbutazone

Effective May 29, 2003, the Federal Drug Administration is banning the extra-label use of Phenylbutazone in dairy cattle 20 months of age or older. The drug, which can cause toxic reactions and blood disorders in humans, has been detected in cull dairy cows. Phenylbutazone has a very long half-life which may account for the residues but which also makes it effective. Similar to Banamine, it is an anti-inflammatory and reduces fever. Phenylbutazone was primarily used to treat lameness in cows. Most veterinarians and producers have been aware of human health concerns and stopped using it a few years ago.

Michigan's Agricultural Weather Disaster Request Granted

Michigan farmers in several counties who have faced various weather-related crop losses are now eligible for federal disaster assistance after U.S. Department of Agriculture Secretary Ann Veneman granted the state’s November 2002 request.

According to Michigan Department of Agriculture Director Dan Wyant, the USDA designation addresses both of the state’s extreme weather conditions of last harvest season: excessive rain in 14 Upper Peninsula counties and drought in 19 southern Lower Peninsula counties. The designation was based on 30 percent or more losses in at least one commodity from each county.

The 14 Upper Peninsula counties receiving primary and three counties receiving contiguous disaster declaration due to damage and losses caused by excessive rain beginning April 1, 2002 are: Primary: Alger, Gogebic, Mackinac, Baraga, Houghton, Marquette, Chippewa, Iron, Ontonagon, Delta, Keweenaw, Schoolcraft, Dickinson and Luce. Contiguous: Cheboygan, Emmet and Menominee.

On the opposite end of the spectrum, the 19 southern Lower Peninsula Counties receiving primary and 10 counties receiving contiguous disaster declaration due to damage and losses caused by drought beginning June 15, 2002 are: Primary: Barry, Lenawee, Berrien, Livingston, Branch, Kalamazoo, Calhoun, Monroe, Cass, Shiawassee, Eaton, St. Joseph, Genesee, Van Buren, Hillsdale, Washtenaw, Ingham, Wayne and Jackson. Contiguous: Allegan, Clinton, Gratiot, Ionia, Kent, Lapeer, Macomb, Oakland, Saginaw and Tuscola.

According to USDA Farm Service Agency State Director David Conklin, the USDA designation makes all qualified farmers in both the primary and contiguous disaster counties eligible for low-interest emergency loans from the USDA Farm Service Agency (FSA), provided eligibility requirements are met. Farmers in eligible counties will have eight months to apply for the loans to cover up to 100 percent of their weather-related production losses.

He instructed interested farmers to contact their local or county FSA offices for further information, including specific eligibility requirements and application procedures. A list of offices is available online at www.fsa.usda.gov/mi/st.html.

MDA Creates Bovine TB Potential High Risk Area in Otsego County

Farms within 10-mile radius of bovine TB positive deer must test within six months

State officials announced in early March that a deer harvested north of the city of Gaylord, in Otsego County’s Livingston Township, during the 2002 hunting season has tested positive for bovine tuberculosis (TB). As a result and according to the state’s TB eradication protocol, the Michigan Department of Agriculture (MDA) has designated any cattle, goat, bison and cervid farms within a 10-mile radius of the deer to be in a “Potential High Risk Area.”

According to MDA State Veterinarian Dr. Joan Arnoldi, small portions of Antrim, Charlevoix, and Cheboygan counties are impacted by the designation. For livestock producers, a Potential High Risk Area is a 10-mile radius around a TB positive, wild free-ranging deer or elk. Such a designation basically requires a producer to undergo a whole herd test within six months of the establishment of the area.

Arnoldi and Michigan Department of Natural Resources (DNR) Wildlife Division Chief Rebecca Humphries said this discovery was not unexpected due to the state’s thorough surveillance testing and aggressive TB eradication efforts and protocol. The TB-positive deer is the fifth positive deer to be found in Otsego County since 1998. During 2002, 1,329 deer from the four counties impacted - Antrim, Charlevoix, Cheboygan and Otsego - were tested for TB with no additional suspects found.

Otsego County is located in the state’s bovine TB Surveillance Zone, which means that herds have undergone biennial testing since the zonal designation in January 2002. Baiting and feeding deer and elk was also banned in Otsego County in 2001 to curb the potential spread of the disease. This particular deer was 32 miles from the state’s TB-affected core area, Deer Management Unit 452.

Historically, Potential High Risk Areas have been designated after outlying deer were identified in Antrim, Osceola, and Mecosta counties. Those areas were dropped from the designation after every herd in the area was tested and no TB was found.

Take the Time to Develop or Update Farm Emergency Plans 

Farms within 10-mile radius of bovine TB positive deer must test within six months

State officials announced in early March that a deer harvested north of the city of Gaylord, in Otsego County’s Livingston Township, during the 2002 hunting season has tested positive for bovine tuberculosis (TB). As a result and according to the state’s TB eradication protocol, the Michigan Department of Agriculture (MDA) has designated any cattle, goat, bison and cervid farms within a 10-mile radius of the deer to be in a “Potential High Risk Area.”

According to MDA State Veterinarian Dr. Joan Arnoldi, small portions of Antrim, Charlevoix, and Cheboygan counties are impacted by the designation. For livestock producers, a Potential High Risk Area is a 10-mile radius around a TB positive, wild free-ranging deer or elk. Such a designation basically requires a producer to undergo a whole herd test within six months of the establishment of the area.

Arnoldi and Michigan Department of Natural Resources (DNR) Wildlife Division Chief Rebecca Humphries said this discovery was not unexpected due to the state’s thorough surveillance testing and aggressive TB eradication efforts and protocol. The TB-positive deer is the fifth positive deer to be found in Otsego County since 1998. During 2002, 1,329 deer from the four counties impacted - Antrim, Charlevoix, Cheboygan and Otsego - were tested for TB with no additional suspects found.

Otsego County is located in the state’s bovine TB Surveillance Zone, which means that herds have undergone biennial testing since the zonal designation in January 2002. Baiting and feeding deer and elk was also banned in Otsego County in 2001 to curb the potential spread of the disease. This particular deer was 32 miles from the state’s TB-affected core area, Deer Management Unit 452.

Historically, Potential High Risk Areas have been designated after outlying deer were identified in Antrim, Osceola, and Mecosta counties. Those areas were dropped from the designation after every herd in the area was tested and no TB was found.

John Kronemeyer Receives Distinguished Service to Agriculture Award

MMPA District 12 Director John Kronemeyer was honored with the Distinguished Service to Agriculture Award March 6 at Michigan State University.

John and two other recipients received the award at the President’s Luncheon during Agriculture and Natural Resources Week.

“John Kronemeyer is equal parts family man, businessman and dairyman,” MSU Dean Jeff Armstrong said. “He displays integrity and efficiency in every aspect of his work and life.”

John and his family milk 280 cows and farm 1,200 acres in Pickford, located in the eastern Upper Peninsula. He has served in leadership positions with the Michigan Agriculture Commission, Michigan DHIA, the Upper Peninsula Fair Board, the Michigan Holstein Association and MMPA. Locally, he is a member of the Chippewa County Farm Bureau and a Marquette Township assessor and supervisor. He has served as a deacon and elder at the Rudyard Christian Reform Church. John also played a vital role in helping to secure new facilities and staff at the Upper Peninsula Experiment Station in Chatham, Mich.

“I am very deeply honored to accept this award,” John said. “Over the years there have been many people who have influenced the direction my life has taken.  My High School FFA Advisor, an uncle, and some neighbor farmers who helped me set up my first dairy herd and saw me through some tough years of sickness and a barn fire are a few examples.

In 1960, the Lord led my wife and myself to look for something a little larger than our 40 acres on the edge of Hudsonville, Mich., and we found ourselves in the U.P.  Little did I know the opportunities that would surface. Service on boards such as DHIA, Farm Bureau, MABC and MMPA soon became a part of everyday life. To be involved in all these things would be impossible with- out the encouragement and support of family.

Dairy farming will always be the love of my life and the friends I have made along the way are the cream on the top.”

Recipients of the award are recognized by their career contributions to Michigan’s agriculture and natural resources. They receive engraved plaques in recognition of the honor. A citation and photograph explaining each recipient’s contribution is on permanent display in Agriculture Hall at MSU. 

         MMPA Honors 35-year Members at Annual Meeting

President Elwood Kirkpatrick recognized the following 20 MMPA members as 35-year members at the State Annual Delegate Meeting on March 18. He commended them for their dedication to the dairy industry and MMPA.  

Stanley E. Bandkau, Owosso Local

Robert W. Benjamin, Ingham County Local

Howard Clark, St. Clair-Macomb Local

Gaylord Denslow, Evart Local

Gerald Denslow, Evart Local

Ronald E. Elenbaum, Clifford-Mayville Local

Larry Foster, Hillman Local

Maurice A. Hamming, Evart Local

Harley J. Hooker, Muskegon Local

Lawrence D. Karsten, Hillman Local

Lewis Karsten, Hillman Local

Marvin J. Marion, Saline-Ann Arbor Local

Larry Minnis, Ingham County Local

Robert Morlock, Evart Local

Chris J. Rasmussen, Alma Local

Arthur Severance, Deford Local

Albert L. Styma, Hillman Local

Albert Troyer, Constantine Local

Robert Vanassche, Evart Local

Henry M. Ziel, Bad Axe Local

What MMPA looked like in 1968, when these members joined:

Glenn Lake was president
Jack Barnes was general manager 

MMPA was 52 years old
Today MMPA is 87 years old 

MMPA had 7,092 members in 1968
As of Sept. 30, 2002 MMPA has 2,602 members 

The average producer shipped 354,901 pounds of milk in 1968
MMPA members shipped, on average, 1,735,931 pounds of milk in 2002 

The average value per shipper was $19,725 in 1968
The average value last year was $225,901 in 2002 

The average price of milk was $5.56/cwt. in fiscal year 1968
The average price of milk was $13.01/cwt. in 2002 in fiscal year 2002 

MMPA marketed 2.5 billion pounds of milk in 1968
MMPA marketed 3.2 billion pounds of milk last year 

In the 1968 MMPA Annual Report President Glenn Lake compared a “Decade of Development”:

“There is still much we can do,” we said then, “to improve our position by strengthening and expanding our organizations, our marketing and promotional programs and our bargaining status. There is still much we can do by learning to work with other farm cooperatives. No longer can we afford the luxury of ‘going it alone’, of localism, or of individualism. Cooperation with other cooperatives can benefit all of us, although it may mean sacrificing some of our local programs and pride of complete independence.”

Let us renew our pledge – this year and at this time – to keep working together for a better future. 

General Manager's Report to the Delegates

One last time I appreciate the opportunity to speak to you at our MMPA annual meeting.

It is much more interesting to give a report when milk prices are at record high levels rather than the level of last year. We have seen some of those record years but certainly that was not the case in 2002.

I made a chart of the farm price average for the past 10 years. We can see that there has been a fair amount of volatility over the years. 

As we look at these price levels, we could write a story about each year as to the reason the price was at that particular level. The story would contain items like the milk supply level, the weather and grain price, cow numbers, imports, exports, legislation, the beef price and culling rates, consumption trends, etc.

Out of all these factors affecting the milk price, the two major headings come down to supply and demand.

Since the mid 1980’s, until 2002, the demand or consumption of dairy products has reasonably absorbed the increasing milk supply.  However, that was not the case in 2002. Last year, U.S. milk production set an all time record of almost 170 billion pounds. That was about three percent more than the previous year. In addition, imports of dairy products continued to come into the country.

On the other side of the equation, the demand or consumption of dairy products stalled in 2002. You have heard all the explanations – the national economy was weak, unemployment was increasing, consumers didn’t eat out as often, the retail prices did not reflect the decrease of the raw milk price, etc. Whatever the reasons, the increased production of cheese and butter did not find a home in the commercial market. Instead, they began filling up the cold storage warehouses around the country, resulting in depressed prices for butter and cheese and in turn caused the milk price to trend downward.

As the months went by last year, the most surprising factor was the continued upward trend in milk cow numbers. Historically, when milk prices have been weak for a 6 to 8 month period, we have seen the milk cow numbers begin to drop. That trend did not develop last year. Milk prices began to drop in late 2001. By historical standards, the number of milk cows should have started falling in mid 2002.  However, we saw a steady increase in milk cow numbers beginning in the fall of 2001 and the trend continued through all the months of 2002. 

It is instructive to look at the relationship between milk cow numbers and the milk price. At the left  is a graph depicting milk cow numbers over the past eight years. The highest annual average milk price was recorded in 1998. I don’t think it is a coincidence that was a period of the lowest number of milk cows we have ever had in this country.  By the year 2000, milk cow numbers were increasing very quickly and you can remember that milk prices dropped severely. Then in 2001 we experienced a heavy sell off of cows and the milk prices escalated to the second highest annual average.

So, when are we going to get out of this soggy situation of low milk prices? The market economists would say it will be when consumption perks up or when milk cow numbers and milk production slows down. As a practical matter it will likely be a combination of both demand and supply. Depending upon which prognosticator you talk to, you can get a wide spectrum of milk price forecasts.

The government predictions from USDA are saying that milk prices in 2003 will be no better than last year, in fact, they may be a little lower. On the other hand, a leading dairy economist is suggesting that milk prices may be sharply higher in the second half of this year. That prediction envisions a rapid drop in milk cow numbers in the spring and summer months.

At the local meetings we gave you a rough estimate of milk prices for 2003. That estimate was based on the futures market numbers from last December. Since that time the futures market has softened. Last week, we took another look at the future quotations for the balance of this year. We computed an estimate of the farm price based on market factors and we also made an estimate of the direct payment from the government. Here is a picture of the estimate for 2003. The market price average is $11.71/cwt. and the estimate for the direct payment is $1.39/cwt., making a total of $13.10/cwt. Of course, I must add that the government payment is on a maximum volume of 2.4 million pounds. I should also add this estimate is for 3.5 percent B.F. and it does not include any quality or volume premiums or added component value that may be applicable.

In May of last year the U.S. Congress voted the approval of a new farm bill. This legislation covered a wide range of issues for all segments of agriculture. Several provisions involved the dairy industry. The one item which captured the most discussion was the Milk Income Loss Contract. The dairymen in the Northeast weren’t happy because it meant the end of the Northeast Compact. The high volume producers in Idaho, California and New Mexico weren’t pleased with the cap of 2.4 million pounds. And some were philosophically opposed to the idea of the government directly supplementing the milk payment to farmers in a manner that may affect the normal milk supply response. But in any event, the legislation was passed and is scheduled to be in effect through 2005. 

In 2002, the MILC payment averaged $1.21/cwt. which amounted to about 10 percent of the total return for dairymen who produced less than 2.4 million pounds. It would appear that this payment will exceed $1.30/cwt. this year. So, it will continue to help pay the vet bills, the fuel bills, and other expenses on the farm.

From a business standpoint, last year was another strong year for your company. When the dust settled at the end of the year, our books reflected a net margin of just over seven million dollars. Last month members received about two million dollars of that margin in cash and also received an equity statement for the balance of the earnings. Later this year in July or August the board will consider making another equity revolvement to pay out the balance of the 1993 equity. That payment will bring our equity retirement schedule to the shortest period of the last twenty-five years.

Last year we completed a major capital project in the construction of a wastewater treatment plant at our Ovid, Michigan manufacturing plant. The treatment plant was put into operation last fall and is performing up to expectations. During the winter months, the treated effluent has been flowing directly into the nearby Maple River. In the summer months, the water will be irrigated on land due to potential algae growth in the river during the warmer months.

Our manufacturing plants at Ovid and Constantine performed well last year. When it’s Easter or the 4th of July or Christmas day or weekends as our fluid customers’ plants are throttled back, our manufacturing plants are running 24 hours a day. In this way, these plants play a major role in our overall operation and the balancing of the fluid market. I should add that the Remus and Allendale plants also are very important in the market balancing aspect of our business.

I want to say that we enjoy our relationship with the Leprino Foods Company out of Denver, Colorado. Leprino is unquestionably the number one marketer of Mozzarella cheese. No one does it better than they do. I remember the day we completed the 20-year agreement to enter a partnership with Leprino Foods. We had enough confidence in this partnership to invest almost thirty million dollars in a new facility in Allendale and to renovate the Remus plant.  This project was an integral part of our strategic plan and it has worked out well for both Leprino and MMPA.

Last year we made a major improvement in our quality premium with regard to the somatic cell count in members milk. I believe our program fully represents the extra value of low somatic cell levels in the milk. In fact, the folks who do the research on the relationship of somatic cell levels and cheese yields would tell you that we are more than compensating for the added value. None-the-less, some milk procurement companies are paying an even higher premium for extremely low somatic cell levels. This is especially the case in Wisconsin. They are not getting more for the milk in the market and they are not getting more yield out of the cheese they make. Rather, they have chosen to take funds off the regular farm price and redistribute it in the form of a somatic cell premium.  I’m sure the board of directors will continue to evaluate this situation and make decisions based on their best judgments.

As I look back over the years that I have been with you, I realize that it has been a great opportunity for me and I want to express appreciation for your confidence in managing the business.

During my first year, we spent a lot of time discussing strategic planning and I gave speeches about our situation and the transition plans we were making. It seemed like a long road and I will admit there were moments that I had doubts myself. But I’ve learned that quite often the greatest success comes out of great challenges. 

As we moved forward with everyone pitching in, with patience and confidence from the board of directors, and I’m not ashamed to say – with God’s grace – we started bringing you significant improvements in the year end reports.

I could display a lot of charts and graphs to show the changes over the years – but I’m not going to do that.  You have seen the year end reports and the only thing that is meaningful is your interpretation of our efforts and the effect it has had on the balance sheet of your Cooperative.

When I came to MMPA in 1984, I thought I would probably work here for 10 years and then finish my career with some bigger company. But a funny thing happened along the way. I fell in love with the company and developed a close relationship with MMPA members and with the employees who made our success possible.  So, rather than moving on, I stayed here as your general manager.

However, all of us have stepping stones in life. Now, my wife and I have concluded it is time to take another step and move onto another chapter in our life. My wife has been with me for 34 years and has been very understanding of the demands of my job. She knows that I have a very close kinship to farmers. 

A couple of weeks ago, a newspaper reporter called to talk about my years with MMPA. When the conversation was ending, she asked how I would be remembered when I leave. I said, well, that is something you should ask the farmers – but I would hope the remembrance would read something like this – “We needed a hired hand – and he answered the call.”

It has been a privilege to work for you. Thank you for the past 18 years and I wish you the best in the years ahead.

Resolutions

The following resolutions were adopted by the MMPA Delegates at the State Annual Meeting, March 18, 2003. 

Current Resolutions

Milk Pricing and Market Regulation

C-1. U.S. DAIRY POLICY 

We applaud the U.S. Congress for passing the 2002 Farm Bill which contains a broad assortment of programs benefiting dairy farmers across the country including:

1.     Extension of the dairy price support program at the current $9.90/cwt. level (through a period of six years);

2.     Authorization for a new national Johne’s disease control program;

3.     Requiring a promotion assessment to be imposed on imported dairy products equivalent to what producers pay domestically;

4.     Extension of the Dairy Export Incentive Program (DEIP);

5.     Fixing the statutory mandatory inventory and price reporting language to prevent further costly reporting errors by the USDA;

6.     Increased funding for dairy and livestock producers through the Environmental Quality Incentives Program (EQIP). We further urge that the EQIP funds be made available in a timely manner.

We continue to urge the unity of all dairy farmers across the nation as future dairy industry issues arise in Congress so we may enter the debate with one strong, united voice. 

C-2. Milk Protein Concentrate 

We support current legislation that would impose Tariff-Rate Quotas on imports of milk protein concentrates and casein products intended for use in the food and animal feed industry.

We also believe that due to the various forms in which MPC’s are labeled that there be a standard of identity issued to MPC’s.

It is our understanding that true MPC’s either dried or wet, if produced in the U.S. would have both legitimate markets and economical benefits to the producer, processor and consumer. We, therefore, do encourage any efforts within the dairy industry to produce dried or wet MPC’s for use in the legitimate markets.

We do, however, oppose any provision which would change current standards already in place pertaining to the manufacture of dairy products which are subject to those standards. 

C-3. MMPA Dairy POLICY

We continue our firm commitment to maximizing returns to dairy farmers and ensuring stability of the milk market. We believe in the concept of over-order pricing and acknowledge its effectiveness when accompanied with equitable sharing of proceeds among all dairy farmers in the market.

We urge MMPA to maintain the concept of over-order pricing and equitable sharing of the over-order proceeds among all dairy farmers.

We endorse the voluntary superpool, which is currently supported by all market participants.

We urge cooperatives and all others involved in the dairy industry across the country to work together in a manner that promotes market stability. We encourage our leaders, when possible, to work with dairy organizations to solve problems to the benefit of all dairy farmers. 

Advertising, Research, Education and Public Relations

C-4. Fluid Milk Promotion Campaign    

We applaud the efforts of the National Fluid Milk Processor Promotion Board for their Milk Processor Education Program (MilkPEP). We believe this program serves as a complement to the ongoing producer financed dairy product promotion program and support the integrated marketing plan now underway between the producers and processors. We strongly encourage continued product promotion by the National Fluid Milk Processor Promotion Board.

In addition to the joint marketing plan, we support the continuation of joint programs between the MilkPEP and DMI that utilize the same research and market data, detailing the motivations, attitudes and behavior of consumers toward dairy products and channels of distribution. We support efforts to bring dairy farmers and processors together to identify and breakthrough barriers to fluid milk marketing. 

C-5.  MSU Extension

We are deeply concerned about the pending budget cuts to the MSU Extension programs and urge the State Legislature to work toward restoring these funds as quickly as possible. We further urge local county governments to continue their support for local MSU Extension agents serving agriculture. 

C-6. 4-H, FFA AND AGRISCIENCE EDUCATION 

We reaffirm our belief in the value of youth-directed programs and activities of the Michigan 4-H Clubs, FFA, and Agriscience Education — all of which are vital to the future of America. We recognize that most MMPA members benefited from taking part in these programs and we recommend that each dairy farm family accept the challenge of personal involvement to help perpetuate these valuable programs and activities.

We support the establishment of standards for ethical behavior in exhibiting livestock at fairs and expositions. Furthermore, we support youth livestock ethics education and awareness.

Further, in view of the vital investment that vocational agriscience programs represent in the future well-being of the state’s economy, we urge that these programs be fully funded, on a continuing basis, at levels to ensure their effectiveness. That is particularly important in small rural school districts located in areas that often must compete for funds with large urban school districts. 

C-7.  MICHIGAN STATE UNIVERSITY

We continue our staunch support for Michigan State University’s College of Agriculture and Natural Resources, the College of Veterinary Medicine, and programs of Extension and Research. We support continued legislative funding for these two colleges and their facilities at appropriate levels.

We urge the MSU Administration and Board of Trustees to continue the focus on improving agricultural education, research, and extension programs. We support the continuation and strengthening of the Agricultural Technology program at MSU.

We acknowledge the importance of a working partnership between the industry and university. We expect to achieve cooperative efforts from the college faculty, providing partnership and interchange between the university and the dairy industry.

We endorse the efforts of the Dairy Industry Committee and look forward to continued cooperation with this committee to provide future direction for the dairy industry.   

C-8.  MSU College of Agriculture and Natural Resources

We are aware that due to the current budget situation at Michigan State University tough decisions and reductions have to be made. We urge the Dean of the College of Agriculture and Natural Resources to be mindful of the purpose of the Land Grand University when making changes. We must not lose, through any departmental changes, the agricultural focus that has been so vital to the university.

We are deeply concerned about the pending elimination of the Department of Agricultural Engineering at Michigan State University. The Agricultural Engineering Department has been the lead department in addressing the many environmental changes facing Michigan farmers. To eliminate the department at this time would be detrimental to the work being done in the department. The industry relies strongly on the expertise and leadership this department offers when addressing environmental concerns.

We are also concerned about the pending merger of the Agriculture and Natural Resources Education and Communications System Department (ANRECS) with Resource Development and Parks and Recreation. While we understand that these types of mergers may be necessary, we are concerned about losing the agricultural emphasis in these programs, in particular in the Agriscience Education, communications and FFA programs.

Furthermore, we encourage the Dean to maintain open, honest and forthright communication with the agricultural industry as changes are being made. We encourage the Dean to seek input from those affected by the changes before the final steps are taken. 

Legislative and Regulatory Issues

C-9.  INTERNATIONAL TRADE 

We direct the MMPA board of directors to closely monitor international trade discussions to ensure the interests of U.S. dairy farmers are preserved and advanced. Furthermore, we support the consensus position on trade policy in the dairy industry “white paper” drafted by the United States Dairy Export Council and endorsed by National Milk Producers Federation and the International Dairy Foods Association. The “white paper” calls for the following:

1.     Work toward the reduction and elimination of export subsidies.

2.     Standardize tariff rates between countries and eventually eliminate all tariffs.

3.     Seek out new market-opening measures in a multilateral setting rather than in less significant bilateral agreements.

We appreciate Congress granting Trade Promotion Authority (TPA) to the U.S. president providing the administration the power to be effective in trade negotiations. However, we encourage the U.S. president to maintain fair trade policies when negotiating with any country to ensure the preservation of the U.S. dairy industry.

We endorse the dairy industry’s challenges to countries we believe to be in violation of WTO policies and urge continual monitoring of those areas.

In addition, because various countries within the WTO are working to increase access to world markets, we ask the FDA and USDA to inspect all dairy imports to ensure they meet U.S. health and quality standards. 

C-10. United States Dairy Export Council

We support and encourage further development of the U.S. Dairy Export Council (USDEC) to increase net exports of U.S. dairy products. With the continued productivity of U.S. dairy farms, we will have an even greater reliance on world markets for our products. We therefore need to continue to effectively work to develop international markets through the USDEC. 

C-11. FARMLAND AND OPEN SPACE PRESERVATION ACT

We reaffirm our support of the Farmland and Open Space Preservation Act, PA 116 as an effective, voluntary method to preserve essential farmland and open space while providing farmers needed tax relief.  

C-12. FARMLAND PRESERVATION

Michigan has lost over 1 million acres of farmland in the last fifteen years and the migration of residents from cities to rural agriculture areas creates additional land use conflicts with existing farming operations. Farmland preservation programs are critical to ensure a long-term business environment for the future growth of Michigan agriculture and are an essential complement to efforts to improve agriculture’s economic viability.

Michigan Milk Producers Association recommends changes in state and local land use policies to include the establishment of voluntary farmland preservation programs. MMPA supports the following legislative initiatives:

•     Passage of state enabling legislation for the voluntary transfer of development rights (TDR),

•        Establishment of long-term revenue sources dedicated to provide $35-50 million in annual funding for the Michigan Agricultural Preservation Fund which is used to provide up to 75 percent state matching funds for local purchase of development rights programs (PDR),

•     Creation of agricultural security areas or districts in which farmland property taxes are capped at $5 per acre in combination with a conversion fee that is paid when the land is developed. The funds from the conversion fee would be earmarked for the Michigan Agricultural Preservation Fund.

Michigan Milk Producers Association supports local initiatives to establish voluntary farmland preservation programs, including PDR, TDR and agricultural security areas or districts. MMPA encourages members to become involved in helping communities establish county PDR programs. MMPA supports developing partnerships with other diverse organizations that provide effective assistance in helping communities establish successful farmland preservation programs and positive land use policies, including urban redevelopment and higher density suburban growth. 

C-13. RIGHT TO FARM

Knowing the importance of protecting our environmental resources, we encourage dairy farmers to maintain high standards of environmental practices. We acknowledge the Michigan Commission of Agriculture’s role in developing and reviewing Generally Accepted Agricultural and Management Practices (GAAMPs).  Practices dealing with livestock manure management, fertilizer storage and use, pesticide storage and use, animal care and site selection for new and expanding animal livestock facilities have been reviewed and approved by the commission.  We encourage the continued development of other practices that will provide protection for other segments of agriculture. We urge awareness among the Michigan Commission of Agriculture, Michigan State University and others involved in developing the guidelines that there is an opportunity to preserve the quality of our environment while maintaining an efficient agriculture community. 

C-14. Nutrient Management 

We acknowledge that it is the responsibility of all livestock producers to follow proper nutrient management guidelines to prevent any contamination of our environment. We strongly encourage producers to follow the Michigan Right to Farm Generally Accepted Agricultural and Management Practices (GAAMPS) for Manure Management and Utilization.

We endorse the agreement between the Michigan Department of Environmental Quality (MDEQ) and the U.S. Environmental Protection Agency to issue the National Pollutant Discharge Elimination System General Permit for Concentrated Feeding Operations (General Permit) for the State of Michigan. The permit gives producers with 1,000 animal units or more who have not had a documented discharge, the option to follow the General Permit guidelines or become verified through the Michigan Agriculture Environmental Assurance Program (MAEAP). Producer compliance of these programs, should help prevent further permitting or a reduction of the definition of a concentrated animal feeding operation (CAFO) from 1,000 to 500 units.

We endorse the efforts of the Michigan Agriculture Environmental Assurance Program (MAEAP) to help producers assess and reduce environmental risks on farms. We encourage all producers, regardless of farm size, to seek environmental assurance through MAEAP verification.

In accordance with the General Permit and MAEAP, we encourage all producers to develop a comprehensive nutrient management plan (CNMP) for their farming operation. A CNMP addresses manure handling and storage, land application of manure, farm specific conservation practices, feed management, record keeping, and other aspects of waste and nutrient management.

We urge the MMPA Board of Directors and management to closely monitor actions of the EPA, MDEQ and all other agencies in Michigan in an effort to protect the interest of livestock producers.