It looks like California dairy producers will soon be operating under a Federal Milk Marketing Order.
USDA today published in the Federal Register a final decision to establish an FMMO that would cover the entire Golden State. Before it goes into effect, however, the plan must be approved by producers in a referendum that will be held from April 2 through May 5. The FMMO would become effective if approved by two-thirds of the voting producers, or by producers of two-thirds of the milk represented in the voting process.
Milk marketing orders promote orderly marketing conditions by applying a uniform system of classified pricing through the farm milk market. There are currently 10 FMMOs governing different regions throughout the country but California, which produces about 18 percent of the nation’s milk, operates on a state order administered by the California Department of Food and Agriculture.
“The proposed order would recognize the unique market structure of the California dairy industry through tailored, performance-based standards to determine eligibility for pool participation,” USDA said today in a news release. The order also “provides for the recognition of producer quota as administered by the CDFA.”
USDA said it will hold a public meeting beginning on April 10 in Clovis, Calif., to answer questions related to how the proposed California FMMO would operate and how eligible dairy producers can participate in the referendum. Interested parties will have the opportunity to attend in person or watch the meeting live via webcast. Meeting details, as well as information regarding the producer referendum, are available on the AMS website which can be accessed by clicking here.
Producers have been awaiting a final decision by USDA on a California FMMO, hoping to bring their milk prices up to par with other major milk-producing states. The department’s decision announced today is based on the evidentiary record of a public hearing held in Clovis in 2015. A recommended decision regarding the proposed program was published Feb. 14, 2017.
California’s three largest dairy cooperatives – California Dairies Inc., Dairy Farmers of America Inc. and Land O’Lakes Inc. – submitted a proposal for a FMMO in February 2015. At the time they said shifting to an FMMO for California reflected the desire of their members to receive more equitable, market-based milk prices.
Land O’Lakes said it is reviewing USDA’s decision. In a statement, the company noted again that it got involved in the creation of a potential FMMO to help the state’s dairy farmers receive more equitable prices for their milk. It also thanked U.S. Agriculture Secretary Sonny Perdue, Sen. Diane Feinstein, D-Calif., and Reps. Jim Costa, D-Calif., and David Valadao, R-Calif., “for their efforts to help move this forward.”
(This story was updated at 5:45 p.m. to include fresh comment from Land O'Lakes.)