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‘Time to consider improvements’ in milk marketing system, say farm groups

The first update to the federal milk marketing system in nearly a quarter-century “should improve price discovery, improve the clarity of the program, continue to support timely payments to producers and reduce price incentives to de-pool milk,” said a dozen U.S. farm groups on Monday. The groups said they believed the USDA would call a hearing in 2023 to address price formulas used in the marketing system.

“We are encouraged by the healthy discussion at this week’s Federal Milk Marketing Order (FMMO) Forum and look forward to continuing the discussion about promoting a healthy dairy industry through modernization of federal order pricing,” said the groups, led by the American Farm Bureau Federation and the National Milk Producers Federation. The groups met over the weekend in Kansas City to discuss changes to the marketing order system, which applies to around 75% of U.S. milk production and determines the price paid to dairy farmers for their milk.

In a statement, the groups said the milk marketing system was key to assuring fair prices to farmers and it should be periodically updated. “With the last major update to the FMMO system occurring in 2000, we believe it is times to consider improvements that better reflect today’s milk markets,” said the groups.

Since 2000, payments to farmers were based on how milk is used in their region. There are 11 marketing regions and the four classes of milk are fresh milk for sale in stores; milk used in making “soft” products such as yogurt, ice cream and cottage cheese; milk used in making hard cheeses, cream cheese and whey; and milk used in making butter, milk powder and nonfat dry milk.

Also on Monday, the USDA opened enrollment for dairy farmers wanting coverage under the Dairy Margin Coverage subsidy in 2023. Deadline for signup was Dec. 9

Produced with FERN, non-profit reporting on food, agriculture, and environmental health.
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