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Kohl Wants Officials to Look at Antitrust Concerns in Dairy Industry
Wisconsin Ag Connection - 09/16/2009

U.S. Senator Herb Kohl is calling on two federal agencies to scrutinize antitrust enforcement within the dairy industry. In a letter to Secretary of Agriculture Tom Vilsack and Assistant Attorney General Christine Varney, the Milwaukee Democrat asked that their respective departments focus on the consolidation of milk processors and anticompetitive practices in agriculture, and urged them to hold a workshop on dairy in Wisconsin as part of upcoming series of DOJ/USDA workshops about agriculture competition.

Kohl chairs the Senate Agriculture Appropriations panel and Chairman of the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights. He says hard-working family farmers are the backbone of the dairy industry and face significant competitive constraints--especially during the current dairy crisis.

"They currently struggle with milk prices that have fallen to historic lows while the costs of production--including feed, fertilizer and fuel--have risen drastically," Kohl said. "This makes it increasingly difficult for continued operation, and many are forced to close their doors. Processor consolidation, especially where fluid milk is concerned, has in some regions left farmers with few marketing options."

The letter goes on to say that processor consolidation is also an area of legitimate concern for consumers. Kohl says despite historically low farmgate prices for fluid milk, consumers have seen little of the benefit of lower prices.

"We need to explore in assertive detail whether the exercise of monopoly pricing power is contributing to this situation," he noted.

Kohl also praised efforts to help farmers by strengthened the Milk Income Loss Contract program in the last farm bill and working on an appropriations measure that would bolster dairy support. But he says more needs to be done.

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