Neighboring states hurt Md. milk industry

March 08, 1995|By Amy L. Miller | Amy L. Miller,Sun Staff Writer

Competition from neighboring states is hurting Maryland's dairy industry, supporters of a proposed milk commission told the House Environmental Matters Committee yesterday.

The seven-member commission -- suggested in a bill submitted by Del. Donald B. Elliott of New Windsor -- would require that farmers be paid a specific price for raw milk. Dairymen from Virginia and Pennsylvania, two of four states that have similar commissions, are dumping excess milk in Maryland and undercutting prices, supporters said.

"The dairy industry is in a state of crisis," said J. Anita Stup, a co-sponsor of the bill. Ms. Stup is a Republican who represents Frederick and Washington counties, which with Carroll County produce most of the state's milk.

"This has all the easy buzzwords that make the hair stand up on the back of your neck," she said. "But before you close your minds to it, please read the literature in front of you."

The bill's opponents -- primarily milk processors who would be required to pay fees to run the commission -- said the proposal would only create another layer of regulation and duplicate the current federal milk support program.

Processors are companies that package milk; producers are the dairy farmers.

"If you pass this legislation, I wouldn't blame the other farmers if they come back next year and say, 'We're having trouble with our industry, too' and ask for price supports," said Barry Sher of Giant Food. "All this will do is add another layer of bureaucracy."

Dairy farmers and representatives from the state Department of Agriculture countered that federal price supports, designed as a safeguard that help to ensure steady milk prices for consumers, are in danger of being eliminated by Congress.

Bill supporters also said a commission would not necessarily raise consumer prices. In Pennsylvania between 1989 and 1991, for example, prices paid to farmers for milk were among the highest in the country, but consumers were paying among the lowest prices.

"In a limited market survey, we found that the fluctuations of the raw milk prices paid to farmers had little relation to the retail price," said Boyd Cook of the Dairymen Cooperative in Sykesville.

The bill, co-sponsored by 14 delegates primarily from western counties, is similar to legislation that was submitted by JTC now-retired Del. James E. McClellan of Frederick last year.

Mr. McClellan withdrew the legislation minutes before the committee hearing last year after dairy processors said they had not been involved in creating the bill.

Processors and farmers met throughout the summer to fashion this year's proposal. But opponents to the bill said the committee's work is not done.

Unlike last year's bill, however, the administration has formally supported the proposal.

During a news conference yesterday morning, Gov. Parris N. Glendening said concern about unfair competition from surrounding states led him to support the bill.

"There is a great concern about the declining number of dairy farms and that some price stabilization must be brought," he said. "Particularly, given that the surrounding states which serve the same area have that price stabilization."

Under the current proposal, the Maryland's seven processors would be required to obtain a $100 per year license to distribute milk in the state.

Processors and milk producers would each pay part of a monthly assessment up to 5 cents per 100 pounds of fluid milk. Bill supporters would expect to charge a monthly fee of 2 cents per 100 pounds of milk to cover costs.

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