WASHINGTON (Reuters) - The U.S. government will shift 200 million lbs. of nonfat dry milk surpluses to domestic feeding programs, helping low-income families and dairy farmers hit by high feed costs and low prices, Agriculture Secretary Tom Vilsack said on Thursday.
“President Obama understands that providing food to those in need will help many weather these tough economic times,” Vilsack said in a statement.
The Agriculture Department said the nonfat dry milk will be used for processing or barter in order to acquire goods such as ultra high temperature milk, cheese, and soups for domestic feeding programs.
Vilsack sad the donations “will benefit dairy farmers, who have seen markets disappear and prices plummet in recent months, by increasing consumption of milk and other dairy products.”
An over-supply of milk and inadequate demand has led to milk prices falling more than 50 percent from last year, after hitting lifetime highs in 2007.
The number of cows being sent to slaughter has increased as farmers reduce their herds and sell them at rock bottom prices.
The nonfat dry milk will be transferred from USDA’s Commodity Credit Corp to its Food and Nutrition Service, which runs public nutrition programs such as food stamps.
USDA estimates it will acquire 415 million lbs. of nonfat dry milk and 10 million lbs. of butter this year to bolster milk prices, compared to 111 million lbs. of dry milk in 2008.
USDA public nutrition programs will cost about $73 billion in fiscal 2009. They range from school milk to food stamps and the Women, Infants and Children food program.
An estimated 61 million Americans are affected by USDA’s nutrition programs. A record 31.8 million Americans receive food stamps.
Reporting by Christopher Doering; Editing by Lisa Shumaker