Dairy Donation Program Launched

USDA Establishes Dairy Donation Program as Pandemic Aid

Jewel Bronaugh, USDA's deputy secretary, announced funding availability for the Dairy Donation Program on Wednesday. Bronaugh also said further aid for dairy will be coming in announcements that will change payments under the Dairy Margin Coverage program. (DTN file photo and USDA profile image)

WASHINGTON (DTN) -- Agriculture Deputy Secretary Jewel Bronaugh on Wednesday announced the establishment of a $400 million Dairy Donation Program (DDP).

Under the DDP, eligible dairy organizations will partner with nonprofit feeding organizations that distribute food to individuals and families in need with USDA, then receive reimbursements for the dairy products that are donated. The goal of the program is to provide dairy product donations at times when traditional purchase programs don't move quickly enough.

"The benefits of the Dairy Donation Program are twofold -- it supplements other financial support for producers while providing nutritious dairy products to American families," Bronaugh said. "When there is surplus milk production, we encourage the milk be donated instead of being dumped. Together, we can help someone in need, minimize food waste and support the U.S. dairy industry."

DDP was inspired in part by the donations made by the Michigan Milk Producers Association in conjunction with the Food Bank of Eastern Michigan in response to the Flint water crisis. Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., participated with Bronaugh, dairy producers and a representative of Feeding America in a call to reporters announcing the program.

"Michigan dairy farm families and food banks continue to lead by example. I am proud of the role they played in pioneering this initiative, which has become a model for the nation," Stabenow said.

Asked about the potential for this program and other forms of pandemic aid to add to the farm bill baseline so that there would be more budget authority available for the 2023 farm bill, Stabenow said, "I always welcome more baseline."

"Michigan is on every page" of the program, Bronaugh told reporters. Bronaugh also noted that, while previous programs have distributed milk, this program covers other dairy products, including cheese and yogurt.

The Dairy Donation Program comes after Agriculture Secretary Tom Vilsack last week also announced details of a $350 million dairy program, the Pandemic Market Volatility Assistance Program. Under that program, payments will reimburse qualified dairy farmers for 80% of the revenue difference per month based on an annual production of up to 5 million pounds of milk marketed and on fluid milk sales from July through December 2020.

Bronaugh said dairy producers can expect additional upcoming announcements, such as $580 million that will supplement the Dairy Margin Coverage (DMC) for smaller farmers. USDA also will make a long-term change to the feed-cost calculation for the DMC program to recognize that alfalfa hay is more expensive but more consistent with dairy feed rations. That change will be retroactive to 2020, so farmers will receive about $100 million more in payments for 2020 and 2021 under that alfalfa change.

On the press call, a reporter questioned the timing of the announcement, noting schools are reopening, driving more demand for milk to the point that supplies are low in some parts of the country. Stabenow said in response that she would have loved to have seen the program come out sooner.

Stabenow added: "We're still certainly seeing an unevenness in terms of need across the country. And even as we look at children going back to schools, which is a whole other issue for us now, as we'll look at school meals and all of the needs connected to that, but everything I have seen is that there is still a need."

The International Dairy Foods Association (IDFA) and the National Milk Producers Federation both praised the Dairy Donation Program.

IDFA President and CEO Michael Dykes said: "IDFA applauds USDA for finalizing the Dairy Donation Program, making it possible for U.S. dairy companies to donate fresh, nutritious dairy products to nonprofit organizations reaching Americans struggling with hunger and food insecurity. Since the start of the COVID-19 pandemic, U.S. dairy producers and dairy foods companies have led efforts to feed the hungry and support struggling communities. With the Dairy Donation Program announced today, USDA is providing our industry with one more tool to reach Americans in need. The dairy industry welcomes the opportunity to continue to partner with non-profits, charities, and other organizations working to combat hunger and nutrition insecurity."

National Milk Producers Federation President and CEO Jim Mulhern said: "We thank USDA leadership for their work to bring the Dairy Donation Program to fruition. This important program will help dairy farmers and the cooperatives they own to do what they do best: feed families nationwide. Dairy stakeholders are eager to enhance their partnerships with food banks and other distributors to provide dairy products to those experiencing food insecurity, which the COVID-19 pandemic has only exacerbated."

Vince Hall, interim chief government relations officer at Feeding America, said, "Feeding America applauds today's announcement implementing the Dairy Donation Program, which has the potential to connect millions of additional pounds of dairy donations through food banks to the people we serve."

The Dairy Donation Program will be run by USDA's Agricultural Marketing Service, and details may be found on its website.

-- USDA AMS -- Dairy Donation Program https://www.ams.usda.gov/…

-- USDA summary -- Establishment of a Dairy Donation Program https://www.ams.usda.gov/…

Jerry Hagstrom can be reached at jhagstrom@nationaljournal.com

Follow him on Twitter @hagstromreport

Chris Clayton can be reached at Chris.Clayton@dtn.com

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