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NMPF Board Unanimously Backs Milk Pricing Package

November 8, 2022

NMPF’s Board of Directors unanimously endorsed a proposal to modernize the Federal Milk Marketing Order system Oct. 25 at its annual meeting in Denver, following months of extensive deliberation on the future of federal milk pricing..

The Board reviewed a package of changes that were initially developed and proposed by a task force of NMPF cooperative experts and later approved by the organization’s Economic Policy Committee. The key recommendations are the result of more than 100 meetings of member and industry experts during 2022. The changes include:

  • Returning to the “higher of” Class I mover;
  • Discontinuing the use of barrel cheese in the protein component price formula;
  • Extending the current 30-day reporting limit to 45 days on forward priced sales on nonfat dry milk and dry whey to capture more exports sales in the USDA product price reporting;
  • Updating milk component factors for protein, other solids and nonfat solids in the Class III and Class IV skim milk price formulas;
  • Developing a process to ensure make-allowances are reviewed more frequently through legislation directing USDA to conduct mandatory plant-cost studies every two years; and
  • Updating dairy product manufacturing allowances contained in the USDA milk price formulas.

The NMPF task force working on these issues still has to finalize certain pricing data involving an examination of Class I price differentials at the county level, work that’s expected to be completed later this year. A final proposal will be reviewed again by the organization before being submitted to USDA as the basis for a federal order hearing.