Congress Yet To Decide Price Of Milk: May Lead To 'Dairy Cliff'

Congress is yet to pass the latest version of the country's sweeping farm bill. If this issue is not looked into immediately, it could lead to what's become known as the "dairy cliff."

The Bush tax cuts have been keeping lawmakers busy, leaving them no time to pass the latest version of the country's sweeping farm bill and avoid what's become known as the "dairy cliff."

According to a recent report by "The Business", if Congress won't pass the bill latest by January, the price of milk could rise drastically to as much as $3 a gallon, according to the country's farm policy laws dating from 1949.

The Department of Agriculture has assured Americans that the price of milk would not rise immediately in the coming year and that they are looking into all options to avoid such a mess.

However, currently there is little hope that Congress will look into the farm bill in time to avoid the farm policies to go back to what they were six decades ago.

"The best outcome would be for Congress to do its job and pass a five-year bill," Agriculture Secretary Tom Vilsack said last week. "The worst outcome is for us to continue to see Congress do nothing and for permanent law to come into effect."

Milk is not the only commodity that would be affected if the bill is not passed. The farm bill also includes clauses that deal with disaster relief for farmers and foreign food aid that expired Oct. 1 because of inaction by Congress.

"It would be an administrative nightmare," said James Dunn, professor of agricultural economics at Penn State. "The farmers would lose a lot of flexibility in what they produce."

The milk situation is even more crucial to be looked into because milk is produced throughout the year.

The Senate had already passed a farm bill a bill earlier this year and The House Agriculture Committee approved a version of it, but the House leadership has not allowed the bill to be debated by the entire House. And now the bill shows no sign of being passed ahead of the year-end deadline.

The year had not been a good one for dairy farmers with the country's historic drought driving up the cost of feed for cows and the price of milk staying too low to help their margins.

"If this doesn't turn around, then we won't have a dairy industry as we think of it in the United States," said Loren Lopes, a 66-year-old dairy farmer in Turlock Calif.

Lopes's farm milks about 500 cows. Many dairies are shutting down, said Lopes, and his son, who is 40, isn't sure if the business is right for him anymore.

"We've been at it and struggled through it," Lopes said. "My son is really getting discouraged . . . . We're getting older and he's looking at what future is left."

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