Advancing the Dairy Industry: Key Strategies Unveiled in Ongoing FMMO Hearings
Source: The DairyNews
In an ongoing series of Federal Milk Marketing Order (FMMO) hearings, dairy leaders remain steadfast in their commitment to advocate for U.S. dairy farmers.
During a recent episode of the National Milk Producers Federation (NMPF) Dairy Defined podcast, Stephen Cain, NMPF's Vice President for Economic Policy and Market Research, emphasized the holistic approach that sets their FMMO proposals apart from those of processor groups.
Cain stressed the importance of addressing all facets of the industry, considering the federal order system's lack of updates over the past 20 years. He highlighted the need to simultaneously update Class I differentials and make allowances to reflect the evolving landscape.
Mike Brown, Chief Economist of the International Dairy Foods Association (IDFA), pointed out that significant changes in the dairy industry since 2008 necessitate amendments to the current FMMO pricing formulas. Brown emphasized the industry's reliance on innovative products like cheese, yogurt, health beverages, powders, frozen treats, and value-added fluid milk, asserting that outdated pricing policies hinder the sector's growth.
With the USDA reviewing over 12,000 pages of testimony, Peter Vitaliano, NMPF's Vice President for Economic Policy and Market Research, acknowledged that compromises would be necessary. Gregg Doud, NMPF's President and CEO, underscored the financial impact on dairy farmers under the current formula, emphasizing the need to revert to the previously effective 'higher-of' formula.
Brown revealed that 40 proposals were submitted to the USDA, with 21 accepted for the hearing process, including two from IDFA. These proposals focus on updating make allowances and revising Class I milk pricing to better serve dairy farmers while enabling processors to manage price risk effectively.
The upcoming steps involve interested parties submitting corrections by April 1, with USDA expected to issue a recommended decision by June 30. Despite the complexities, industry leaders express optimism that the final result will mark a significant improvement over the existing system. Dairy Herd Management remains committed to providing updates on the unfolding FMMO ruling decision.
Cain stressed the importance of addressing all facets of the industry, considering the federal order system's lack of updates over the past 20 years. He highlighted the need to simultaneously update Class I differentials and make allowances to reflect the evolving landscape.
Mike Brown, Chief Economist of the International Dairy Foods Association (IDFA), pointed out that significant changes in the dairy industry since 2008 necessitate amendments to the current FMMO pricing formulas. Brown emphasized the industry's reliance on innovative products like cheese, yogurt, health beverages, powders, frozen treats, and value-added fluid milk, asserting that outdated pricing policies hinder the sector's growth.
With the USDA reviewing over 12,000 pages of testimony, Peter Vitaliano, NMPF's Vice President for Economic Policy and Market Research, acknowledged that compromises would be necessary. Gregg Doud, NMPF's President and CEO, underscored the financial impact on dairy farmers under the current formula, emphasizing the need to revert to the previously effective 'higher-of' formula.
Brown revealed that 40 proposals were submitted to the USDA, with 21 accepted for the hearing process, including two from IDFA. These proposals focus on updating make allowances and revising Class I milk pricing to better serve dairy farmers while enabling processors to manage price risk effectively.
The upcoming steps involve interested parties submitting corrections by April 1, with USDA expected to issue a recommended decision by June 30. Despite the complexities, industry leaders express optimism that the final result will mark a significant improvement over the existing system. Dairy Herd Management remains committed to providing updates on the unfolding FMMO ruling decision.
