Vilsack's new job: Promoting U.S. dairy trade

Tom Vilsack, who stepped down as agriculture secretary the other day, will pay his next professional chapter as cheerleader in chief for U.S. dairy exporters.

The longest-serving part of Barack Obama’s cabinet is focused to start his new position as president and CEO on the U.S. Dairy Export Council on Feb. 1, Vilsack confirmed within a exclusive interview with POLITICO. It’s just a high-profile hire aimed toward boosting dairy sales abroad numerous U.S. producers battle to remain business as a result of the best prices stemming with a global market flooded with milk.

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“There are tremendous opportunities,” Vilsack said, pointing to Mexico, Honduras, Asia and North Africa as prime markets for expansion.

“It’s a troublesome industry, but we’ve seen an extraordinary boost exports through the years,” he was quoted saying.

When the U.S. Dairy Export Council launched in 1995, dairy exports landed roughly 5 percent within the U.S. dairy industry’s production. Since that time, that percentage has nearly tripled to 15 percent, the consequence of a sustained, global promotion effort. In 2016, dairy exports were up as a percentage of volume, since you can overall value dropped to a estimated $4.7 billion, down from the high of almost $6.8 billion in 2014.

“There are some that don’t understand why we simply cannot be able to 17 to twenty percent,” Vilsack said, when asked about whether you will find there’s goal, concerning amount of production.

“It’s a tricky market,” he said. “Our producers remain to be efficient trying to establish methods of produce countless get it done inside a sustainable way.”

Vilsack is to take over the reins at USDEC from Tom Suber, who retired this past year after leading the group considering that it was initially established by Dairy Management Inc., the industry’s checkoff program. The checkoff has funded campaigns like “Got Milk?” to inspire usage of dairy products, and other research and market development programs in recent times.

Dairy producers and importers pay 15 and seven.5 cents, respectively, per hundred pounds of milk you can purchase right into a generic fund directed at promoting dairy products, raising over $140 million annually for that dairy checkoff program, about $20 million which often is required to support the USDEC’s activities and employee salaries. Almost all the executives from financial disclosures pull mid to high six-figures in annual compensation.

Vilsack is regarded as a “ready-made expert” on boosting sales of U.S. farm products abroad given his background as agriculture secretary, said Tom Gallagher, Dairy Management Inc.’s CEO.

“I don’t even think we have seen anybody in agriculture that’s more excited about standing up for U.S. farmers and ranchers,” Gallagher said. “And I think he can continue his experience for an executive in this new role.”

Having this kind of tireless advocate for U.S. farmers and rural America and that is “an emotional shot while in the arm” for a lot of industry leaders, that are feeling hopeful that Vilsack might help turn around the slumping dairy economy, Gallagher added. Many U.S. dairy farmers are barely breaking even today that milk prices have dropped nearly Forty percent over the past two years caused by overproduction in america and European and slowing demand from China.

But the hire will not be without its critics. After Agri-Pulse reported earlier this year that Vilsack was likely headed to USDEC, Tom Philpott at Mother Jones wrote the fact that move would “represent a good swish in the revolving door separating government departments along with the industries they regulate.”

With the move, Vilsack is considered to be finding a huge pay bump – something that’s common for outgoing cabinet officials. Vilsack was making roughly $205,000 leading USDA. Based on the newest tax filing available, Suber’s base compensation in 2014 was $355,000, however with bonus and everything factored in, his compensation totaled just over $875,000.

When asked about the revolving door criticism, Vilsack pointed into the ethics restrictions constantly in place and said he intends to follow them “to the letter.” It’s unlawful for commodity checkoffs to buy lobbying efforts targeted at influencing legislation or administrative activities.

“I think it is important for anyone to grasp the very severe ethical restrictions that will be affixed to a retiring secretary of agriculture,” Vilsack said, explaining that she cannot have direct contact with any USDA officials. “No one," he said. “The a single I could contact may be the ethics officer.”

“There’s a really bright line that’s absorbed in relations to access and approach and communication with individuals at USDA, but that’s very important to folks to grasp,” he added. “There’s and a fairly restrictive approach with regards to federal agencies inside exec branch of presidency. There’s no doubt that if people understood that they’d be less concerned.”

In his new gig, Vilsack is expected to waste the earliest several months traveling within the country to see from dairy farmers and USDEC members, gathering input to aid formulate an idea for one more 5 to 7 years.

Over the future, the debate shall be on tackling trade barriers, checking untouched markets, and spurring demand, while also promoting efficiency and sustainability advancements domestically, Vilsack said.

The former agriculture secretary is to take the helm in a uncertain time for free trade. The Trans-Pacific Partnership promised to grow market access for U.S. milk in countries like Japan, Vietnam and Malaysia. But President-elect Mr . trump has vowed to withdraw the U.S. through the TPP and has now yet to lay out a specialized agenda for international trade.

“We don’t know what the policies are probably going to be therefore we really won’t know for a long time,” Vilsack said, adding the fact that political appointees by the incoming administration will probably be key for deciphering the insurance plan direction.

In accessory promoting demand, there’s also serious trade barriers that needs to be tackled, whether they’re sanitary and phytosanitary issues or geographical indications, Vilsack added.

“These are threats on the industry that should be treated,” he was quoted saying.

In interviews, both Vilsack and Gallagher named a long list of countries and regions that are considered top priorities, including some with the 12 involved in the TPP.

“You require when the consumers are,” Vilsack said, pointing to China, Japan, Columbia and Southeast Asia. “I think there are opportunities in Africa which will without doubt expand over time. And there is no reason why we can’t be competitive in Latin America.”

In the context of global trade, Vilsack said he views his future work as which has an impact far beyond dairy.

“I think my focus is usually on the way we export the American brand,” Vilsack recently told POLITICO. “It’s a way for us to not only sell more milk and dairy food, yet it’s additionally a chance of us to stress the American type of quality and innovation.”

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