milk supply

New Federal Milk Marketing Order Recommendations Released

Brian GermanDairy & Livestock, Dairy and Livestock, Industry

The U.S. Department of Agriculture (USDA) has proposed amendments to the Federal Milk Marketing Orders (FMMOs) after a comprehensive 49-day hearing held in Indiana. The amendments aim to update milk pricing formulas and factors, including changes to milk composition factors, removal of 500-pound barrel cheddar cheese prices from surveys, updates to Class III and IV formula factors, and the establishment of a new base Class I skim milk price formula. These changes are designed to reflect current market conditions and improve price equity, especially for extended shelf-life milk products.

Milk Marketing

American Farm Bureau Federation (AFBF) President Zippy Duvall appreciated the hearing but criticized some changes that they believe favor processors over struggling dairy farmers. Duvall stressed the need for a mandatory survey of processors’ costs to ensure fairness and transparency in milk checks. AFBF plans to submit detailed comments on the proposals and urges its members to do the same.

Gregg Doud, President and CEO of the National Milk Producers Federation (NMPF), praised the USDA’s decision for reflecting many of their recommendations, despite some deviations. He noted the return to the “higher-of” formula for Class I skim milk prices and the removal of barrel cheese from pricing formulas as significant wins. NMPF plans to review the milk marketing recommendations thoroughly and provide detailed feedback.

The USDA’s recommendations will be published in the Federal Register to invite public comments. Stakeholders have 60 days to submit their feedback, followed by a producer vote expected in early 2025. This proposal marks a significant step in modernizing the milk pricing system, and balancing the needs of dairy farmers, cooperatives, and the broader industry.

Brian German
Ag News Director / AgNet West