Author: Theresa Sweeney

Dairy’s Success Comes in Many Varieties

Posted on by Theresa Sweeney

Just as when sampling a top-quality cheese, success in creating a great policy environment usually comes one small bite at a time. NMPF and its members have had an opportunity in the past month to savor several recent gains for our members that create more certainty and more opportunity for cheese producers and dairy employers.

First, the cheese.

A judicial ruling announced Jan. 6 determined that “gruyere” is a generic style of cheese that can come from anywhere. The decision reaffirms that all cheesemakers, not just those in France or Switzerland, can continue to create and market cheese under this common name.

The fight centered around the European Union’s attempt to turn gruyere cheese into “Gruyere” by filing for trademark protection of the name in the United States for regional French and Swiss products. NMPF, the Consortium for Common Food Names (CCFN), U.S. Dairy Export Council (USDEC), and a coalition of other dairy stakeholders fought the attempt from the start. The U.S. Patent and Trademark Office decided against the EU in August 2020; the U.S. District Court for the Eastern District of Virginia upheld that decision in its January ruling.

It’s important to note that dairy’s win is everyone’s win. The landmark victory sets an important precedent in the larger battle over food names, giving U.S. agriculture greater legal support against the EU against efforts to monopolize common names such as gruyere, parmesan, bologna or chateau. We emphatically agree with the court’s statement that the arguments of the French and Swiss associations were “insufficient and unconvincing,” while CCFN, which works closely with NMPF, presented “overwhelming evidence that cheese purchasers in the United States understand the term GRUYERE to be a generic term which refers to a type of cheese without restriction as to where that cheese is produced.”

That victory, following closely on the heels of U.S. dairy’s victory over Canada’s bad-faith use of dairy quotas to limit U.S. market access under the USMCA trade agreement, was a great way to start the new year. It was followed by another gain, this time for dairy employers, via the U.S. Supreme Court’s decision Jan. 13 to block the Biden Administration from enforcing a vaccination-or-testing requirement crafted by the Occupational Health and Safety Administration.

To be sure, the decision wasn’t a denial of the value of a vaccinated workforce, which NMPF has urged in the past and continues to advocate. It was, however, a welcome acknowledgement that OSHA’s broad requirement overstepped its authority. And at a time when COVID tests are scarce and supply chain snarls are leaving some grocery shelves empty, the mandate also simply wasn’t practical.

NMPF had been working with other agricultural organizations and speaking with administration officials since before the Emergency Temporary Standard was first proposed, advocating for dairy’s interests and sharing member concerns. NMPF and several members of the National Council on Farmer Cooperatives first met with the White House Office of Management and Budget (OMB) in October — more than two weeks before the rule was released — to raise numerous concerns about the mandate.

After the ETS was released, NMPF warned federal officials in letters and personal meetings that lack of testing and other resources could create hardships for businesses already struggling with staffing shortages and that food and agriculture businesses could face severe supply chain disruptions under the mandate.

The court win, of course, doesn’t end the need for effective workplace strategies to mitigate COVID disruptions. NMPF has joined other organizations in urging that the food and agriculture sector, as an essential part of the U.S. economy, be prioritized in federal coronavirus-testing efforts. And NMPF has resources for employers on its coronavirus webpage.

And it’s also true that one favorable court ruling doesn’t end the long fight against the EU’s attempted use of cheese names to promote protectionism. The Swiss have already appealed the decision, and battles over gruyere and other common cheese names will undoubtedly continue.

But the victories underscore that progress is possible, and that dairy can advance on the policy front with unity and purpose. With more challenges on the horizon, it’s important to remember the sweet taste of progress — or in the case of gruyere cheese, the rich, creamy, nutty and salty taste of progress. The year is shaping up to be an exciting one. We look forward to advancing our members’ interests on many fronts, with as wide a variety as the quality products our industry produces.

USDA Outlines New Program at NMPF, USDEC Supply Chain Webinar

Posted on by Theresa Sweeney

Agriculture Secretary Tom Vilsack today announced a new program to help address the export side of the supply chain crisis. The initiative was addressed at a webinar of agriculture industry and policy leaders hosted by the National Milk Producers Federation (NMPF) and the U.S. Dairy Export Council (USDEC).

The USDA program discussed during the webinar was launched in partnership with the Port of Oakland and will set up a new “pop-up” site at the port dedicated to easing the loading of empty containers with agricultural exports. The new site will also have a dedicated gate with the ability to pre-cool refrigerated shipping containers in order to reduce bottlenecks at the main entrance to the port.

The new arrangement should be available beginning in March and will include support of $125 per container for movement logistics costs. See the USDA press release here.

“Congestion in and around U.S. ports is one of a series of export supply chain challenges undercutting U.S. dairy exporters’ ability to reliably meet the needs of overseas customers for high-quality U.S. dairy products,” said Krysta Harden, president and CEO of USDEC. “By creating a process specific to handling U.S. agricultural exports, we expect USDA’s new partnership with the Port of Oakland will help alleviate some of those challenges. We look forward to working with USDA and our members on this new initiative while continuing to pursue additional legislative and administrative solutions to the dairy export supply chain crisis.”

“The delays and disruptions in export shipping have cost the U.S. dairy industry well over $1.3 billion through just the first three quarters of 2021 – to say nothing of the rest of America’s agricultural sector. Solving this problem simply cannot wait any longer and today’s announcement of the close collaboration between our associations, the Port of Oakland and USDA is one key step in the right direction,” said Jim Mulhern, president and CEO of NMPF. “Today’s webinar brought together leaders in Congress and the Administration whose efforts have been central to the multi-faceted work of addressing agricultural export supply chain challenges. We thank them for their continuing work and their participation today and look forward to pursuing additional steps to deliver relief for dairy exporters.”

Agri-Pulse, which served as the media partner for the event, reported over 1,200 registrations for the webinar, one of the highest pre-registration figures in the publication’s webinar history.

Speakers included USDA Secretary Tom Vilsack; John Porcari, the Biden Administration’s Supply Chain Ports Envoy; Rep. John Garamendi (D-CA); Rep. Dusty Johnson (R-SD); Mike Durkin, president and CEO of Leprino Foods; Andrew Hwang, manager of business development and international marketing for the Port of Oakland; and Jon Eisen, director of the Intermodal Motor Carriers Conference for the American Trucking Association, as well as moderators Krysta Harden of USDEC and Jaime Castaneda of NMPF and USDEC.

The USDA announcement came just days after Secretary Vilsack hosted a virtual roundtable with leading agricultural industry CEOs on Jan. 27 in which NMPF and USDEC members, among others, raised their concerns tied to exports.

USDEC and NMPF, in collaboration with other agriculture interests across the U.S., have leveraged a multi-prong approach with Congress and the administration since early 2021 to address the supply chain disruptions plaguing the dairy industry, including unprecedented fees, container availability, and lack of transparency.

For example, in addition to last week’s meeting at USDA, NMPF and USDEC supported a bipartisan letter led by U.S. Reps. Jim Costa (D-CA) and Dusty Johnson (R-SD) and signed by 71 members of Congress to the White House urging the administration to use its emergency powers to immediately address problems caused by the crisis and mitigate risks to U.S. agricultural exporters. The letter made three specific requests:

  • Utilize available emergency authorities to incentivize carriers to load full outbound containers instead of empties.
  • Utilize emergency actions that allow gross vehicle weight limits to exceed 80,000 lbs., even if only on a temporary basis.
  • Utilize existing tools and authorities to provide immediate access to critical shipping and logistics equipment.

Dairy Grows Through Family and Faith, CDI’s Vander Woude Says

Posted on by Theresa Sweeney

Despite policy challenges, family-run dairies continue to grow and succeed through dedication and faith, California dairy farmer Simon Vander Woude, the chairman of California Dairies Inc., first vice-chair of NMPF and a member of its executive committee, says in an NMPF podcast released today.

“We begin every day acknowledging that what we have is not our own, it’s a gift from the Lord, and we have to be good stewards of the gifts that He’s blessed us with,” Vander Woude said. “We’ve been very blessed here.”

That stewardship is expressed in many ways, from caring for the environment to seeking new opportunities to serve consumers in the United States and worldwide, he said. Vander Woude, who testified before a congressional subcommittee last year on the need to expand global market access, said that while domestic consumers continue to want dairy products, overseas sales are the key to harnessing dairy’s growing productivity and international demand.“If 20 to 30 percent of our milk products are going overseas today and our domestic market is pretty stable, it’s growing at a smaller pace than what we can grow our milk markets,” said Vander Woude, who also sits on the board of the U.S. Dairy Export Council. “We need to continue to explore trade agreements with countries that will benefit the U.S. dairy industry.”

The full podcast is here. You can find and subscribe to the podcast on Apple Podcasts, Spotify, Google Podcasts and Amazon Music under the podcast name “Dairy Defined.” A transcript is also available here. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

Pandemic Market Volatility Assistance Program Payments Are on Their Way

Posted on by Theresa Sweeney

Through the Pandemic Market Volatility Assistance Program (PMVAP), USDA will provide up to $350 million in pandemic assistance payments to dairy farmers early this year. This initiative will partially reimburse producers for unanticipated losses created during the COVID-19 pandemic when federal dairy food box purchases weighted heavily toward cheese, combined with a change to the Class I mover formula created the unintended consequence of significant financial losses.

Payments will reimburse qualified dairy farmers for 80 percent of the revenue difference per month on up to 5 million pounds of milk marketed and on fluid milk sales from July through December 2020. The payment rate will vary by region based on the actual losses on pooled milk related to price volatility. As part of the program, handlers also will provide virtual or in-person education to dairy farmers on the program and other dairy topics.

What are the eligibility requirements?

Producers who ship to handlers, including cooperatives, and are regulated under the Federal Milk Marketing Order (FMMO) system will be eligible for PMVAP reimbursements if their average Adjusted Gross Income (AGI) is less than $900,000 or if 75 percent of their AGI comes from farming and ranching activities.

How are payments calculated?

The amount of money from USDA due to a cooperative is determined by the volume of the cooperative’s milk regulated by the FMMO during July to December 2020. The monthly payment rate during that time is 80 percent of the difference between the previous and the current Class I price formulas. Because prices change every month and there are 11 FMMOs, USDA is using 66 different payment calculation rates to determine how much money is due to producers.

Many variables affect an individual producer’s actual payment. A program-wide, uniform producer payment rate is impossible because so many variables go into a producer’s payment.  And significantly, eligible milk per producer or farm entity is limited to 5 million pounds of milk marketed, or 833,000 pounds per month during the period of July through December 2020. Milk produced beyond this cap is not eligible for payment. Other variables include:

  • Total pounds of pooled milk
  • Producer AGI eligibility
  • Producer participation declination
  • Applicable Order-specific monthly rate
  • How a cooperative originally paid its producers

USDA is working closely with cooperatives and other handlers to determine producer payments based on the factors described above. In addition, USDA will verify that each handler made producer payments correctly.

How and when will money be distributed?

USDA is establishing individual agreements with cooperatives and other handlers, who are responsible for paying dairy farmers. Once a handler receives their PMVAP payment from USDA, they have 30 days to disburse monies to producers. USDA anticipates that eligible dairy farmers will receive PMVAP payments during the first quarter of 2022.

What’s next?

Significant issues remain with how payments are distributed, making additional funding necessary to close gaps in the program, which arose from the efforts of NMPF and its member cooperatives but fell short of what the organization advocated. Caps on the production amount covered by the program will limit assistance in ways that create inequitable outcomes among dairy producers. NMPF is engaged in efforts with Congress to remedy this shortfall. At the same time, NMPF is continuing discussions about the Class I mover to end the disproportionate risk borne by dairy farmers under the current formula that creates disorderly market conditions.

More Resources

Dairy Defined: Despite Disruptions, Dairy Keeps Going, and Growing

Posted on by Theresa Sweeney

Another year, another flavor of COVID-related disruptions, this time the Omicron variant that’s spreading rapidly and disrupting schools and workplaces. But it isn’t 2020 all over again – too many lessons learned, too much resilience has been built up to see a full return to the massive economic and social dislocations of the past.

That’s especially true in dairy, where, despite all the marketplace challenges, demand has only kept growing.

The data don’t lie: Per-capita dairy consumption in the U.S. has been growing and is at the highest levels since 1960. Exports in 2021 are on pace for a record. We already knew that. Now, with last year’s retail sales data available, we can see that 2020’s gains in grocery-store purchases weren’t just a rechanneling of lost school and restaurant business toward at-home consumption. By comparing 2021 with 2019, we can see that dairy’s gains are built to last, according to data from industry researcher IRI.

Cheese is up. Butter, up. Yogurt and sour cream, up. Fluid milk declined as consumers shift toward dairy in other forms, but even that category had bright spots. Because grocery-store milk prices have increased, actual fluid-milk revenues rose nearly $900 million over the past two years. That’s actually a bigger gain than plant-based beverages, which saw sales of their more-expensive products rise only $513 million.

And fluid’s decline wasn’t uniform across all categories: Whole milk consumption increased 0.5 percent over the past two years and is now well-established as the most popular variety of conventional milk, showing that fluid milk is more popular when it tastes more like milk.

The facts show it, once again: Dairy is alive, well and growing. The products dairy farmers and cooperatives labor to create every day are only increasing in importance to U.S. consumers, and even more so worldwide. The trend is so consistent that restating it is almost becoming tiring to say.

But it’s 2022. Being tired doesn’t mean you stop.

 

Dairy Defined Podcast: Price Forecast Positive for Dairy, NMPF’s Vitaliano Says

Posted on by Theresa Sweeney

Dairy prices for 2022 are projected at an eight-year high, with supply adjustments and booming exports across a wide range of products shoring up farmer balance sheets that have struggled with volatility during the pandemic era, NMPF Chief Economist Peter Vitaliano says in an NMPF podcast released today.

Due to tight supplies “not only is the outlook for milk prices the best in eight years, but that’s also the case for the individual dairy products,” Vitaliano said. Peter Vitaliano. “The big question is, with milk prices this good and feed prices not going up as fast as they were last year, how long is that tightness going to continue? And how soon will it be before we see some expansion of milk production again?”

Vitaliano, who also writes NMPF’s monthly Dairy Market Report, also encouraged farmers to sign up for the Dairy Margin Coverage program, which has a deadline of Feb. 18 for 2022 assistance. “The futures markets look very good at the moment, but there are many months to go. The history of dairy farmers second-guessing the markets, even based on the futures, is not very good. And again, given how inexpensive coverage is, our recommendation continues to be you should sign up for the program.”

NMPF resources on the Dairy Margin Coverage Program can be found here.

The full podcast is here. You can find and subscribe to the podcast on Apple Podcasts, Spotify,   Google Podcasts and Amazon Music under the podcast name “Dairy Defined.” A transcript is also available here. Broadcast outlets may use the MP3 file below. Please attribute information to NMPF.

Judge Rules “Gruyere” is a Common Food Name and Not a Term Exclusive to Europe

Posted on by Theresa Sweeney

A judicial ruling has determined that “gruyere” is a generic style of cheese that can come from anywhere. The decision reaffirms that all cheesemakers, not just those in France or Switzerland, can continue to create and market cheese under this common name.

In the judicial decision made public yesterday evening, the Consortium for Common Food Names (CCFN), U.S. Dairy Export Council (USDEC), National Milk Producers Federation (NMPF), and a coalition of other dairy stakeholders prevailed in their sustained fight to preserve the ability of all actors in the U.S. marketplace to use generic terms.

Senior Judge T. S. Ellis III of the United States District Court for the Eastern District of Virginia upheld the August 5, 2020, precedential decision of the U.S. Patent and Trademark Office’s (USPTO) Trademark Trial and Appeal Board.

“Not only is this a landmark victory for American dairy farmers and cheese producers who offer gruyere, this win sets a vital precedent in the much larger, ongoing battle over food names in the United States,” said Jaime Castaneda, executive director for CCFN. “The European Union has tried for years to monopolize common names such as gruyere, parmesan, bologna or chateau. This verdict validates that we’re on the right path in our fight on behalf of American food and wine producers to preserve their ability to use long-established generic names.”

According to the Court’s decision, the arguments of the French and Swiss associations were “insufficient and unconvincing” and CCFN presented “overwhelming evidence that cheese purchasers in the United States understand the term GRUYERE to be a generic term which refers to a type of cheese without restriction as to where that cheese is produced.”

Meanwhile, Europe continues its aggressive and predatory efforts to confiscate names that entered the public domain decades ago. The latest attack was launched by the French and Swiss gruyere associations which had sought to register “Gruyere” as a certification mark in the United States, thereby enabling them to prevent use of the generic term by others in the U.S. marketplace. The USPTO determined last year that the application should be denied, in the process upholding the widespread generic use in the U.S. of the term “gruyere.”

“French and Swiss gruyere producers already have access to the U.S. market and the use of distinctive trademark logos,” noted Castaneda. “In fact, the Swiss association has already registered a logo certification mark with the USPTO for ‘Le Gruyère Switzerland AOC’ to help it uniquely brand Swiss gruyere. Despite this, both foreign associations appealed the USPTO’s ruling to the federal court last year.”

With support from USDEC and NMPF, their member companies, and non-member companies that contributed to supporting the opposition, CCFN dedicated extensive time and resources throughout the appeal process to demonstrate the extensive use of gruyere in the U.S. marketplace and persuasively argue that all cheesemakers and their customers should retain their rights to continue to produce and sell gruyere in the United States.

“This is a huge victory for common sense and for hard-working manufacturers and dairy farmers,” said Krysta Harden, USDEC president and CEO. “When a word is used by multiple companies in multiple stores and restaurants every day for years, as gruyere has been, that word is generic, and no one owns the exclusive right to use it. We are gratified that Judge Ellis saw this straightforward situation so clearly and upheld the USPTO Trademark Trial and Appeal Board’s finding that gruyere is an established generic term.”

“NMPF continues to firmly oppose any attempt to monopolize generic names like gruyere and to reject blatant European market-share grabs designed to limit competition,” said Jim Mulhern, NMPF president and CEO. “Today’s announcement is a landmark win for American dairy farmers and the commonly named cheeses they produce and sell around the world.”

CCFN, USDEC, and NMPF support valid geographical indications (GIs) – compound names associated with specialized foods from regions throughout the world – when used in good faith rather than to establish unfair trade barriers to the sale of common name foods and beverages.

CWT-Assisted Dairy Export Sales for 2021 Reach Nearly 1.5 Billion Pounds

Posted on by Theresa Sweeney

Despite not taking bids for two weeks during December breaks, CWT member cooperatives secured 41 contracts in December adding 3.5 million pounds of American-type cheeses, 105,000 pounds of butter, 44,000 pounds of whole milk powder, 767,000 pounds of cream cheese and 300,000 pounds of anhydrous milkfat to CWT-assisted sales in 2021. These products will go customers in the Caribbean, Asia, Middle East-North Africa and South America, and will be shipped from December 2021 through June 2022.

CWT-assisted dairy product sales contracts for 2021 total 53.1 million pounds of American-type cheese, 16 million pounds of butter, 6.4 million pounds of anhydrous milkfat, 12.2 million pounds of cream cheese and 45.1 million pounds of whole milk powder. This brings the total milk equivalent for the year to 1.447 billion pounds on a milkfat basis.

Exporting dairy products is critical to the viability of dairy farmers and their cooperatives across the country. Whether or not a cooperative is actively engaged in exporting cheese, butter, anhydrous milkfat, cream cheese, or whole milk powder, moving products into world markets is essential. CWT provides a means to move domestic dairy products to overseas markets by helping to overcome U.S. dairy’s trade disadvantages.

The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT will pay export assistance to the bidders only when export and delivery of the product is verified by the submission of the required documentation.

FARM Presents Survey Results at Town Hall

Posted on by Theresa Sweeney

FARM Program stakeholders identified care for  sick animals, calves, and non-ambulatory cattle as dairy’s  greatest priority to maintain focus on for Version 5 of FARM’s Animal Care Program as determined by an industry wide survey distributed through the fall with results presented at a virtual town hall Dec. 14.

The survey was intended to collect feedback from farmers, veterinarians, cooperatives, processors, and others within the dairy supply chain as planning commences for Version 5 of FARM Animal Care which will launch July 1, 2024. The survey questions were developed following a series of  focus groups hosted last August by the National Dairy Farmers Assuring Responsible Management (FARM) Program. FARM received 682 complete responses, and staff were able to identify potential refinement opportunities for the next program cycle in addition to the top animal care priorities from stakeholders.

The survey also showed general support for making minor modifications and adding clarity to the FARM Animal Care Program while avoiding large overhauls. Most survey respondents, including farmers, showed they would willingly support small changes to better address animal care vulnerabilities. Respondents also were in consensus that standards that aren’t direct measures of good animal welfare practices should be updated to prioritize an outcomes-based approach.

For more information, visit the Version 5 development page.

NMPF Applauds Sen. Baldwin for Pressure on FDA Dairy Labeling Enforcement

Posted on by Theresa Sweeney

NMPF was pleased to support Senator Tammy Baldwin’s (D-WI) efforts to bring attention to the need for Food and Drug Administration (FDA) enforcement of dairy standards of identity at the confirmation hearing of Dr. Robert Califf to become the next commissioner of FDA.

NMPF has long partnered with Sen. Baldwin on the issue, with the Senate committee hearing on Dec. 14 serving as the latest opportunity to bring critical attention to the agency’s lack of enforcement.

After speaking to the importance of dairy standards of identity, Sen. Baldwin asked Dr. Califf whether and when the FDA will begin enforcing its own labeling standards. Dr. Califf responded that he would make the issue a priority should he be confirmed as FDA commissioner, stating there is “almost nothing more fundamental about safety than people understanding exactly what they’re ingesting, so I am committed to making this a priority if I am confirmed.”

NMPF president and CEO Jim Mulhern thanked Sen. Baldwin for pressing Dr. Califf for “urgent action” on the issue, explaining that the issue “needs to be a top-of-mind issue for Dr. Califf” as the “ground has shifted since his previous tenure in the Obama administration, both as dairy imitators proliferate and the abuse of lax labeling enforcement creates nutritional confusion for consumers.”

NMPF has been advocating for the enforcement of standards of identity and integrity in the marketplace for four decades. The recent, long overdue FDA attention to the issue – including a pledge to provide guidance on enforcement in the coming months – provides an opportunity to lead to key progress toward enforcement. NMPF will continue to work with Sen. Baldwin, other members of Congress, and administration officials on the issue, now with Dr. Califf’s positive comments in hand.