A new market opened up for Wisconsin dairy farmers Sunday when the Northeast Interstate Dairy Compact expired, ending tariffs that effectively prevented farmers from outside of New England from selling their milk to New Englanders.
Tim Griswold, executive director of the Dairy 2020 program, a division of the state Department of Commerce that works to assist Wisconsin dairy farmers, said the expiration of the compact would help farmers in the state, but would not cause an increase in the price farmers receive for milk, which has dropped in the past year.
'They do have the opportunity to market their milk to a broader area,' Griswold said. 'We're likely not to see prices go up, but they're likely to go higher than they would with the compact in place.'
Because it limited the market to which Wisconsin farmers could sell, the Northeast Dairy Compact, which included the states of Maine, Vermont, New Hampshire, Massachusetts, Rhode Island and Connecticut, had been a political target of Wisconsin's senators since its enactment in 1997.
Sen. Herb Kohl, D-Wis., said in a statement that the expiration of the compact would open up the way for the government to institute a national dairy pricing policy.
'The expiration of the dairy compact on Sept. 30 gives us an opportunity ... to move away from the divisive compact debate that pits one region of our country against another,' Kohl said.
However, in a joint statement of the Vermont congressional delegation, Sens. Patrick Leahy, D-Vt., Jim Jeffords, I-Vt., and Rep. Bernie Sanders, D-Vt., said they would continue fighting to reinstate the compact. In past months, they have sought to expand the compact to include more states in an effort to broaden the compact's base of political support.
Even though northeastern legislators have been vociferous supporters of the compact, which they say protects the New England dairy industry, 'the real losers during the cartel were the consumers in the area,' Griswold said.
The expiration of the compact will enable Wisconsin farmers to sell their milk in the northeastern United States, but its effect on Wisconsin farmers may be limited because the compact applies to bottled milk, while many farmers here produce milk for cheese production, according to Arlinn Braanstrom, faculty associate at UW-Madison's Center for Dairy Profitability.
In addition, the compact's expiration will not change the nation's milk pricing system that determines milk prices based on a farm's distance from Eau Claire, Wis., Braanstrom said.
That system was set up prior to the construction of the Interstate Highway System to encourage milk production in areas that were too far away to receive milk transported from Wisconsin. But now, transporting milk across the country does not even require refrigerated trucks, making the old pricing system archaic, he said.
'You can just take cold milk from Wisconsin, drive it all the way to Florida and it doesn't have time to warm up yet,' Braanstrom said.
