Bush Signs Milk Regulatory Equity Act into Law

President Bush signed S. 2120, the Milk Regulatory Equity Act into law on April 11th, with the provisions in the legislation becoming effective May 1. Once that happens, the USDA will make three substantial changes to Federal Milk Marketing Orders:

• Some bottling plants which have avoided both state and Federal regulation by selling from a Federal order marketing area into a state-regulated area will be regulated by the Federal order in which they are located.
• Bottling plants in Clark County, Nevada, which have enjoyed a blanket exemption from Federal order regulation, will see that exemption replaced with Nevada's exclusion from all Federal order areas. Nevada plants will continue to be subject to their own state's regulation, but they now will also be responsible for any sales into a Federal order market.
• Finally, under the new law, no plant with Class I sales over 3,000,000 pounds per month will be exempt from full regulation if it has sales into the Arizona market.

CWT Continues to Make Strides Exporting Dairy Products

Through coordinated industry efforts, the CWT program has been able to make substantial exports in the first few months of 2006. Thus far, CWT has exported the milk equivalent of 118 million pounds through butter sales. In addition, CWT has exported the equivalent of 23 million pounds of milk through its cheese exports, 21 million pounds through anhydrous milk fat exports, and 13 million pounds through whole milk powder exports.

New U.S. Trade Representative Announced

President Bush last week nominated the current U.S. Trade Representative, Robert Portman, to serve as Director of the Office of Management and Budget (OMB). To fill Portman's position, the President nominated Portman's deputy, Susan Schwab, to serve as the new U.S. Trade Representative (USTR). Schwab began her career in trade policy nearly 30 years ago by working as an agricultural trade negotiator for the USTR.

Portman will be leaving his position at a time when WTO members have been able to move forward somewhat since the December 2005 Hong Kong Ministerial. The WTO is currently working towards a July 30th deadline of deciding on the specific formulas needed to arrive at their goals, although an April 30 deadline for a framework of trade modalities will likely not be met. WTO members remain deeply divided on several important issues. Schwab's extensive familiarity with the details and players involved in these talks will be critical in ensuring a smooth transition to continue to try to advance negotiations this year.

Another Canadian Mad Cow Case Discovered

A six-year-old Holstein cow in the Canadian province of British Columbia was confirmed as the fifth native born case of bovine spongiform encephalopathy, or mad cow disease, according to Canadian officials. This is the second new BSE case discovered in Canada in 2006.

No part of this animal entered the human food or animal feed systems, according to the Canadian government. Officials have said the cow was born in April 2000, after the Canadian government prohibited cattle from eating feed containing ruminant protein. The ban was put in place in 1997. The U.S. Department of Agriculture said that it will assist the Canadian government in trying to determine how the cow may have contracted BSE.

Although Agriculture Secretary Mike Johanns initially said that this latest case shouldn't affect Canada's trade status with the U.S., last week he indicated the discovery may further delay plans to reopen the border to animals older than 30 months.

USDA had earlier hoped to finish by May a draft of a rule that would lift the U.S. ban on Canadian cattle over 30 months old and start it through the lengthy process of becoming law, but that has been delayed, Johanns said.

MILC Signup Continues Through Mid-May

USDA's Farm Service Agency (FSA) announced that payments under the extended Milk Income Loss Contract Program (MILC) have begun.

The MILC payment program was extended through September 2007. From Oct. 1, 2005, through Aug. 31, 2007, a dairy operation's monthly payment will equal the milk quantity sold in that month multiplied by 34 percent of the difference between $16.94 per hundredweight and that month's domestic Class I milk price.

USDA's Commodity Credit Corporation (CCC) makes payments on an operation-by-operation basis up to 2.4 million pounds of milk produced by the dairy per year.
*Graph based on futures as of April 20, 2006. Months in italics are projections.*

Participating dairy operations must select the month they want to start receiving payments for production. Producers may retroactively select any month beginning October 2005 through May 2006 if they sign up on, or before, May 17, 2006. After May 17, 2006, producers will not have the option of selecting a retroactive month for payment.

Humboldt Creamery Joins NMPF

NMPF is pleased to announce that Humboldt Creamery is joining the 33 other member cooperatives to become NMPF's 34th member.

Humboldt Creamery is based in Fortuna, CA, and was founded in 1929 with 85 dairy farming families. Today, Humboldt Creamery has 62 member dairies, most of which are located in Humboldt County. They supply fresh milk daily, which is used in the production of fluid milk, powdered milk, ice cream and other frozen desserts.

Humboldt has been in full support of CWT since the inception of the program and Frank Leonardo serves as their representative on the CWT Committee.

The Chairman of Humboldt is Jim Renner, while the Rich Ghilarducci serves as the President/CEO. To learn more about Humboldt Creamery visit: www.humboldtcreamery.com

Associate Member Focus: U.S. Dairy Export Council

U.S. Dairy Export Council (USDEC), headquartered in Arlington, VA, is a non-profit independent membership organization that represents the interests of U.S. milk producers, dairy cooperatives, proprietary processors, export trader and industry suppliers.USDEC was created by Dairy Management Inc™ (DMI) to help the dairy industry in the export arena by providing services that directly increase companies' export sales.

To learn more about USDEC visit their website or contact Tom Suber, President, at 703-528-3049.