USDA and the Department of Justice heard from the Dairy Policy Action Coalition (DPAC) last Friday, June 25 during the joint workshop on dairy markets at the University of Wisconsin-Madison. Former Pennsylvania Secretary of Agriculture Dennis Wolff, who is now a partner with Versant Strategies and serves as government relations consultant for DPAC, was invited to participate in the panel discussing marketplace transparency.

“The CME trading volume represents only 0.4% of the cheese produced and sold in the U.S. and 1.7% of the butter,” Wolff stated. “Does this accurately reflect supply and demand? No. It is a market of last resort. We need to dilute the influence of the CME through daily electronic reporting, and this needs to cover more products with auditing that also extends to inventory reporting.”

During the morning roundtable moderated by U.S. Secretary of Agriculture Tom Vilsack and Assistant Attorney General Christine Varney, Sen. Herb Kohl (D-Wis.) and others agreed. “The dairy industry must have market transparency, with more frequent reporting that is expanded to include more products. The USDA has the authority to do it, and Congress wants to work with USDA to make it happen.”

For the dairy producer board members of DPAC, who traveled to Wisconsin for the hearing, these words were welcome news after six months of working with members of Congress and USDA in the quest for funding to implement section 1510 of the current Farm Bill.

USDA officials told DPAC in April that the cost is $1 million. In May, Sen. Arlen Specter (D-Pa.) and Rep. Tim Holden (D-Pa.) wrote a letter to Senate and House ag appropriations subcommittees with signatures from more than 20 other members of Congress from 10 states. Since then, adhoc members of DPAC in the Northeast, Southeast and Midwest have done their part to keep this issue on the front burner. The request is now in appropriations as the fiscal 2011 USDA budget is negotiated.


During the DOJ / USDA panel on market transparency, Wolff said the daily electronic reporting injects accountability into the pricing system in several ways, including accuracy and timeliness.

“If I am pricing cheddar cheese on June 24, the only game in town is the CME as the only NASS Survey data available on that date is from June 7-11,” he explained, adding that NASS simply captures and delays the prior activity of the thinly-traded CME.

He cited a parallel quote from a news article about financial market reforms that are making their way through Congress: “This reform brings 100 percent transparency to the market with real-time price reporting. They will no longer be able to make excessive profits by operating in the dark. Exposing these markets to the light of day will put money where it belongs.”

“That comment about financial market reform could just as easily describe the reform that is needed for price reporting in the dairy industry,” said Wolff.

Government relations consultant Dennis Wolff (left) represented DPAC on the “market transparency” panel at the DOJ / USDA hearing in Madison, Wisconsin.

DPAC chairman and Franklin County, Pennsylvania, dairy producer Cliff Hawbaker (right) attended along with (from left) Laura Covert, adhoc member from Herkimer County, New York; Jack Fritz, adhoc member from Robertson County, Tennessee; Alan Kozak, board member from Holmes County, Ohio; Maury Cox, executive director of Kentucky Dairy Development Council; and Duane Hertzler, board member from Perry County, Pennsylvania.

They traveled to Wisconsin a day early to meet with producers from around the country at a dinner meeting organized by David Cooper, general manager of Family Dairies, a member of the Midwest Dairy Coalition.

Information and photos provided by Sherry Bunting, DPAC Correspondence Secretary