Monday, October 15, 2018
 ADPI Comments On USDA Decision To Utilize Surplus NDM  

In response to USDA's announcement on utilizing surplus NDM in various domestic food assistance programs, Dale Kleber, Chief Executive Officer of the American Dairy Products Institute, issued the following comments:

"ADPI commends Secretary Vilsack for committing to use the increasing stocks of surplus NDM to help feed our country's needy families.  In a down economy, the needs for charitable food donations go up -- and feeding the hungry is clearly the highest and best use for surplus dairy products.  

"It is also certainly beneficial for dairy markets to have an insight into how USDA intends to dispose of the large inventories of surplus NDM that overhang the market.  ADPI supports USDA's efforts to formulate an early plan for the disposition of surplus NDM since nonfat dry milk typically has a shelf life of only two years for the purpose of human consumption. 

"Directing dairy surplus products into uses that do not displace commercial demand, such as domestic and foreign food assistance programs, will help to stabilize the depressed market prices currently affecting all dairy commodities.   Surplus dairy products are best used to stimulate new demand for the dairy category and should not be used to satisfy existing commercial demand.    ADPI encourages USDA and the Congress to continue to pursue all available options for permanently removing surplus NDM from the market.  

"ADPI has some concern, however, that under the plan outlined by Secretary Vilsack almost two-thirds of the surplus NDM will apparently be re-introduced into the market through the various bartering programs.  Under such bartering arrangements, the government trades surplus NDM for other dairy or dairy-based products favored by food banks, such as ultra high temperature milk, cheese, and milk-based soups.    

"Removing large quantities of surplus NDM from the market and subsequently re-injecting it into the stream of commerce through bartering results in a "revolving door" effect that may dilute the economic benefits of the Dairy Price Support Program.   In a recovering dairy market, it will be critical to determine the appropriate timing for re-introducing significant amounts of surplus NDM  into the market if serious marketplace disruptions are to be avoided." 

Click here to access USDA's press release of Secretary Vilsack annoucement

Source: ADPI  

Posted on Friday, March 27, 2009 (Archive on Friday, April 03, 2009)
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