Nebraska Dairy Farmers Watch Farm Bill Debate Closely

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Nebraska's milk suppliers say they're closely watching a debate over dairy policy in Washington D.C.

When he's not milking cows at his farm near Stromsburg, Doug Nuttelman helps craft dairy policy.

"I was one of nine that helped develop the margin insurance, and we patterned it much just like federal crop insurance, which is a better safety net than a price support program," says Nuttelman, a Dairy Farmers of America and National Milk Producers Federation board member.

Nuttelman says the Dairy Title of the new Farm Bill can be broken down into three basic parts: first, getting rid of that price support program - something he says didn't help when prices fell in 2009 and an oversupply of milk drove them down even farther.

Second, he says, is the margin insurance.

Third, is the supply management provision - it would kick in when margin insurance does and force producers to cut back when there's an oversupply. It's what has the House and Senate conferee committee arguing.

The Speaker of the House of Representatives says he won't pass a bill with supply management in it, but producers say it would save the government money because it would help get the market back to normal, thereby getting farmers off the margin insurance faster.

"The margin insurance will work, it's just the idea that it's going to be a lot more expensive dairy program without the supply management," says Nuttelman.

Nebraska Senator Mike Johanns says dairy policy is always debatable in Farm Bill talks.

"I'm personally not a big fan of supply management, I have voted for it to move the Farm Bill along, and I would vote for it again to get a final Farm Bill done, but that is always going to be controversial," says Johanns.

Nuttelman says he worries because Johanns and Congressman Jeff Fortenberry are the only Nebraska delegates on ag committees, but they're subcommittees, so they're not involved in the final Farm Bill.

"Right now all the important work is getting done in committee, and we don't have anybody there," says Nuttelman.

Neither Johanns nor Nuttelman believes grocery store prices will jump if a Farm Bill would not pass in the next few weeks. Both say another extension of the current bill would be more likely than a "dairy cliff."

"I'm optimistic that the House has finally said, look, we've got to get a five-year bill done, let's get it done, get it behind us," says Johanns.