The U.S. Department of Agriculture's statistical arm said it won't issue some agricultural reports this year because of automatic federal budget cuts, alarming some in the dairy industry who fear the information void could wreak havoc with milk prices.
The National Agricultural Statistics Service keeps tabs on a wide range of agricultural industries that generate billions of dollars for the U.S. economy. Its reports influence the price and supply of many products that end up on American dinner plates. Farmers use them to decide how much to produce, and food processors and traders look to them to determine when to buy and sell.
The agency posted a notice on its website Tuesday saying it would suspend multiple reports covering at least 10 agricultural products ranging from milk and chickpeas to cattle and catfish because of $85 billion in across-the-board federal spending cuts went into effect earlier this month. The notice offered almost no details about the rationale for the decision, saying only that it "was not made lightly, but it was nevertheless necessary, given the funding situation."
The budget cuts cost NASS' agricultural estimates program $5.9 million, agency officials said.
Perhaps the highest profile reports on the chopping block are the agency's milk production estimates, which are used to set prices. The agency will issue its February estimate on Tuesday and then suspend its next six monthly reports, along with the annual milk production report that had been expected in April, according to the National Milk Producers Federation.
"This is a big deal," NMPF spokesman Chris Galen said Wednesday. "This is going to affect how decisions are made in marketing of milk and other dairy products. If you don't have a national estimation of what your supply is, then it's a lot harder to figure out where prices are going to go."
Galen said he's not aware of any other entities that produce the data dairy farmers need. His organization plans to send a letter to NASS officials seeking a better explanation and justification for eliminating those reports.
NASS spokeswoman Stephanie Chan didn't immediately reply to an email seeking a response from the agency.
NASS also cancelled its July cattle report, which it has produced since 1973. Cattlemen said that would have less impact than some other cuts, such as furloughing meat inspectors. Ranchers sometimes use the July report to adjust their marketing plans, and it can be a tool for those running feedlots, where cattle go for final fattening before slaughter, said Joe Parker, president of the Texas and Southwestern Cattle Raisers Association. But a January inventory report, which gives a state-by-state breakdown, is more helpful.
"The industry gets a better idea of the inventory location and the movement of that inventory," he said. "We sure would like to keep (the July report) but we should be able to adjust without it."
Other reports that won't come out this year include those on catfish, potatoes, lentils, rice, nuts and some fruit and vegetables.
USDA officials announced in 2011 that they planned to eliminate 14 crop and livestock reports to save $10 million. Farmers complained they would be left guessing how much to produce and when to sell. The agency reversed itself two months later, saying operational improvements had helped free up money to reinstate the reports.