Tag: Federal Milk Marketing Order

Milk Pricing Modernization Now at a Pivotal Point

Posted on by Theresa Sweeney

After more than 150 meetings of our dairy farmer members and co-op technical experts. After extensive outreach and consultation with national organizations, including the American Farm Bureau Federation and state and regional dairy associations. And after multiple unanimous votes at all levels of our organization, NMPF this month will submit to USDA our proposal for the first significant update of the Federal Milk Marketing Order system since 2000.

All those meetings, as well as the preparation and examination that accompanies them, add up to many hours and an incredible amount of analysis on Federal Milk Marketing Orders. But by doing the heavy lifting – one that understands and accounts for the reality that a change to one part of the system affects other important parts — we at the National Milk Producers Federation feel confident in the comprehensive proposal our Board of Directors unanimously approved last month.

While the process of a USDA FMMO hearing and a referendum vote by producers will take some time, we’ve already come a long way toward achieving improvements to milk pricing that will modernize this important program. Through our proposal, dairy farmers have found common ground, and we believe the broader dairy sector can rally around these efforts to strengthen our industry. Important components of our proposal include:

  • A return to the “higher of” Class I mover that’s fairer for farmers than the current system that seemed reasonable when it was included in the 2018 Farm Bill, but which the COVID-19 pandemic showed exposes farmers to disproportionate price risks during market disruptions;
  • Updated milk component factors for protein, other solids and nonfat solids in the Class III and Class IV skim milk price formulas, recognizing that these components have increased in the U.S. farm milk supply since the current formulas were established;
  • Specific make allowance adjustment numbers for the four products contained in the Class III/IV pricing formulas – cheese, dry whey, butter and nonfat dry milk – to help address increases in processing costs, as well as creating a mechanism to keep those calculations up-to-date; and
  • Updated Class I differential prices that reflect changes in the cost of delivering bulk milk to fluid processing plants.

This is difficult work, and at times it’s involved difficult conversations. But the alignment we’ve achieved among farmers, cooperatives and the cooperative-owned processing community has been one of the most critical, and gratifying, parts of the process.

An important principle we’ve followed is that, while building consensus, we’ve recognized that we can’t craft solutions that are one-size-fits all, nor can any proposal succeed when it’s narrowly tailored to what amounts to one-size-fits-one. What do I mean by that? As we quickly learned when we first started looking at federal reform in 2021 with a re-examination of the Class I Mover, a narrowly targeted approach doesn’t work when there are other major imbalances in the system.

In the end, we didn’t pursue Class I alone because we found serious modernization required a serious look at all aspects of federal milk marketing orders and their complex interactions. Now that we’ve done exactly that, we are hoping the industry can broadly rally around the conclusions at which we’ve painstakingly arrived. We owe it to this industry – and especially to the farmers who are at the heart of it – an honest, deliberative, thorough approach that creates opportunities for everyone to thrive.

Our proposal has come after discussions that reflect the great diversity of this industry. We’ve been transparent, driven by an interest in the industry’s overall success, and we aren’t afraid to lay our cards on the table with specific numbers and forecasted impacts. On the make allowance, for example, the majority of our farmers are members of cooperatives that own dairy processing plants; therefore, they have a vested interest in setting the make allowance at the right level — from both the producer and processor perspective. That balance, which runs throughout our proposal, is what is needed to modernize this important program.

After leading the most comprehensive discussion of federal orders this industry’s seen in the past quarter-century, we’re confident we’ve crafted solutions that all of dairy should get behind – with the unanimous approval our board gave to it in March as evidence of our hard work and dedication to consensus. We are heartened by the strong support among dairy farmers from coast to coast for this proposal. A comprehensive, thoughtful, measured, farmer-centric approach to modernizing the program is exactly what USDA should consider as the basis for a national federal order hearing, and we are proud to offer it.

To better understand our proposal, please explore our website at www.nmpf.org. We of course encourage feedback and any helpful comments that should be considered when finalizing our submission, which is currently under way. To reach out to us with questions as we move toward a federal hearing, feel free to write us at info@nmpf.org.

We’re looking forward to advancing this industry in collaboration and partnership. As the national organization representing most of the dairy producers who, in the end, are the ones voting on any changes to the FMMO system, we take our responsibilities seriously. And we look forward to discussing and advocating for our proposal as this critical next phase begins.

Jim Mulhern

President & CEO, NMPF

 

 

NMPF’s Bjerga on March Board Meeting

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga discusses the organization’s recently concluded board of directors in Arlington, VA in an interview with RFD-TV. NMPF’s board unanimously approved a proposal to modernize the Federal Milk Marketing Order system to benefit farmers and better reflect today’s dairy industry. NMPF board members also discussed the ongoing fight against plant-based milk imitators, as well as advances in animal care and sustainability.

Milk-Pricing Proposal Moves Forward as Dairy Leaders Unanimously Endorse NMPF Plan

Posted on by Theresa Sweeney

The National Milk Producers Federation’s (NMPF) Board of Directors unanimously endorsed a proposal to modernize the Federal Milk Marketing Order (FMMO) system today at its March meeting, a milestone that caps more than two years of discussion and more than 130 meetings on different aspects of the proposal.

The plan to reinvigorate the FMMO system that guides milk pricing reflects an industry that’s evolved significantly since the last comprehensive revamp in 2000. It’s a proposal all dairy can get behind, said Randy Mooney, chairman of NMPF’s board of directors and a dairy farmer from Rogersville, MO.

“After gathering dairy’s best minds and consulting with partners across the industry, today we are moving forward with a comprehensive FMMO proposal the entire industry can get behind,” Mooney said. “We look forward to leading a thorough, deliberative process as we submit this proposal to USDA and partner with our allies to modernize milk pricing in ways that serve dairy farmers and the entire industry.”

The board reviewed a package of changes initially developed and proposed by a task force of NMPF cooperative experts and later approved by the organization’s Economic Policy Committee. The adopted changes, listed here, reflects the industry’s evolution while benefiting the farmers who form the bedrock of U.S. dairy. With the board’s approval, NMPF’s next step is to move toward submitting the proposal to USDA as the basis for a federal order hearing while continuing conversations with other dairy stakeholder partners. NMPF President and CEO Jim Mulhern said the organization stands ready to assist farmers, the dairy industry and federal officials in any way it can as the process unfolds.

“We believe in a better future for this industry, and this proposal will help build that future,” he said.

Also speaking at the conference is House Agriculture Committee Chairman Glenn “GT” Thompson, R-PA, speaking on the farm bill expected in 2023 and other federal issues. NMPF looks forward to working closely with Chairman Thompson, a staunch ally of dairy farmers, to complete work on the 2023 farm bill and other matters.

NMPF’s board also welcomed new directors — Jacob Larson of Southeast Milk Inc., and Michael Lichte of Dairy Farmers of America – and released its annual report, highlighting the activities and accomplishments of the past year.

NMPF is the only nationwide organization devoted to advancing the interests of all dairy farmers of all sizes in all regions. A federation of dairy cooperatives, NMPF embodies the spirit of farmer self-help and community leadership.

Board members are also discussing:

  • The need to build upon an FDA proposal on plant-based beverage labeling that doesn’t go far enough to end the mislabeling of imitation products using dairy terms;
  • Industry leadership in animal care, environmental stewardship, and workforce development through the National Dairy Farmers Assuring Responsible Management (FARM) Program;
  • How sound policy can contribute to another record year of U.S. dairy exports; and
  • Potential farm-bill priorities.

The two-day conference concludes tomorrow.

NMPF’s Bjerga on New Pandemic Aid

Posted on by Alan Bjerga

NMPF Senior Vice President of Communications Alan Bjerga said $100 million on new assistance to dairy farmers under the Pandemic Market Volatility Assistance Program will better aid midsize and larger dairies that received inadequate support in an earlier round of aid. Bjerga also discusses mental health stresses among farmers, and a recent Dairy Defined Podcast that discusses ways they can get help. Bjerga was interviewed on RFD-TV.

Congress’s Bumpy Start Could Smooth Farm Bill

Posted on by Alan Bjerga

By Paul Bleiberg, Senior Vice President, Government Relations, NMPF.

The beginning of each new Congress is marked by a period of temporary excitement, borne of optimism that legislators will put aside political differences to finally enact solutions to problems affecting Americans from all walks of life.

The opening of the 118th Congress earlier this month presented a different picture. While the usual political disputes between the two parties remain, the first days of this congress featured not a contrast between Republicans and Democrats, but instead disagreements among Republicans about who to elect as Speaker of the House and, more fundamentally, how to govern the institution for the next two years.

Ultimately, after four days of intense negotiation that occurred both in private meetings and in public on the House floor, Republicans voted to elect California Representative Kevin McCarthy as Speaker of the House for the 118th Congress. Six Republican members who had voted against McCarthy on previous ballots chose to vote ‘present’ on the final ballot, clearing a path for McCarthy to claim the Speaker’s gavel.

Personalities certainly played a role in this conflict and its resolution, but so did significant discussions about the ability of individual members to influence the legislation that advances in the House. Part of the agreement that got McCarthy elected speaker allows members to offer many amendments to bills that reach the floor, a departure from recent practice. Amendment debate and votes can sometimes smooth over bumps in the road to a bill’s passage, but they also can create new obstacles.

This may seem like ‘inside baseball,’ but it is of great importance to one piece of legislation expected to advance this year: the 2023 Farm Bill. House Agriculture Committee Chairman Glenn ‘GT’ Thompson (R-PA) kicked off that process with a recent listening session at the Pennsylvania Farm Show in Harrisburg. Many hearings are expected this spring in both the House and Senate agriculture committees.

Soon after that, the work of drafting the bill will begin. Members on and off the committees will seek to have their say. Yes, this means Congress may take votes on a wide range of amendments to the farm bill, good and bad. Hopefully, the amendment process will help to expand the bipartisan, bicameral consensus that will be needed to enact a farm bill, and not detract from it. But dairy will need to do its part to make sure the process doesn’t work to the detriment of its interests. That means we’ll be striving to maintain the Dairy Margin Coverage program and separate risk management tools, with tweaks as needed, and to ensure dairy’s needs are met in other key titles like conservation, trade, and nutrition.

Dairy will be engaging closely to help guide Congress to that outcome. The beginning of the new Congress wasn’t the most auspicious in terms of unity. Even so, policy progress is always possible, and on the farm bill and other issues, we will work with both sides of the aisle – and even both sides of one aisle should there be conflicts – to get things done.

This column originally appeared in Hoard’s Dairyman Intel on Jan. 23, 2023.

NMPF’s Bjerga on the Congressional Elections and Dairy’s Challenges

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga details some of the policy and marketplace challenges U.S. dairy is striving to meet, regardless of the cloudy outcomes of Tuesday’s congressional elections, in an interview with RFD-TV. Opportunities to grow markets via sustainability, an adequate safety net in the upcoming farm bill, and sensible industry regulation all loom in 2023, with dairy well-positioned to make progress.

NMPF’s Mulhern on FMMO Modernization and the State of Dairy

Posted on by Alan Bjerga

 

NMPF President and CEO Jim Mulhern recaps progress made at NMPF’s annual meeting in Denver last week, including unanimous support for a Federal Milk Modernization Order modernization framework. Mulhern also talks about next steps on FMMO modernization and highlights the current popularity of dairy products and their nutritional benefits, noting the highest U.S. per capita consumption since 1959. Mulhern speaks on the “Agriculture of America” podcast.

Live, from the Dairy Bar, it’s NMPF!

Posted on by Alan Bjerga

 

NMPF Senior Vice President of Communications Alan Bjerga gives an impromptu tour of the Dairy Bar and the Joint Annual Meeting in Denver. From delicious products to critical information, the Dairy Bar has it all — and the meeting itself resulted in gains for dairy producers, as detailed in this interview with RFD-TV.

NMPF Unanimously Endorses Marketing Order Modernization Plan in Annual Meeting

Posted on by Theresa Sweeney

National Milk Producers Federation (NMPF) leadership unanimously endorsed a proposal to modernize the Federal Milk Marketing Order milk-pricing system at its annual meeting in Denver, which concludes tomorrow. It also welcomed new directors — as well as a new member.

“Dairy is positioned to be a trusted anchor in an uncertain world,” said NMPF Chairman Randy Mooney in remarks at the meeting, part of a joint event held by NMPF, the National Dairy Promotion and Research Board and the United Dairy Industry Association. “Together we can seize opportunities to feed the world. Our product is one of the most nutritionally valuable foods available. We create vibrant rural communities that keep America strong by helping to retain local schools, build energy independence, preserve the environment, and ensure food security for everyone.”

Central to discussions was recommendations developed on federal milk pricing after more than 100 meetings that have taken place over the past year. NMPF’s Board of Directors endorsed a proposal that:

  • Returns to the “higher of” Class I mover;
  • Discontinues including barrel cheese in the protein component price formula;
  • Extends 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;
  • Updates milk component factors for protein, other solids and nonfat solids in the Class III and Class IV skim milk price formulas;
  • Develops a process to ensure make-allowances are reviewed more frequently through legislation directing USDA to conduct mandatory plant-cost studies every two years; and
  • Updates dairy product manufacturing allowances contained in the USDA milk price formulas.

NMPF continues work on the Class I milk price surface as it examines information on county-level Class I price differentials. That work is expected to be completed later this year. Any final proposal will be reviewed by the organization before it’s submitted to USDA to be considered for a federal order hearing.

“We have made tremendous progress and are moving forward with the strong level of consensus in the producer community that we will need to achieve our goals of modernization,” said NMPF President and CEO Jim Mulhern. “We’ve had many challenging conversations that were important to getting to a national consensus because of the regional nature of federal milk orders. But the give and take that’s needed to get to anything important done will place the entire industry on a sounder footing, creating a lasting benefit for all.”

NMPF, whose member cooperatives produce more than two-thirds of the nation’s milk, also welcomed Burnett Dairy Cooperative to its membership. Burnett Dairy Cooperative, based near Grantsburg, WI and founded in 1896, is one of the nation’s few remaining full-service cheese-producing cooperatives. It is a frequent winner at both national and worldwide cheese contests.

New directors elected to the Board of Directors and approved by NMPF delegates in 2022 include:

  • Jeff Sims – Lone Star Milk Producers
  • Kevin Ellis – Upstate Niagara Cooperative
  • Cory Vanderham – California Dairies Inc.

NMPF also held its annual dairy contest in conjunction with the meeting. Ellsworth took the top prize, while a yogurt also took high honors in the first-ever inclusion of that category, in prizes awarded in the held in conjunction with NMPF’s annual meeting. 

 The NMPF Chairman’s Award went to Ellsworth Cooperative Creamery for their Pepperoni with Marinara Rub cheese, which achieved a 99.8 score. Agri-Mark received the Chairman’s Reserve Award for its 10% Vanilla Bean Greek Yogurt, which also won the award for best yogurt. Tillamook County Creamery Association earned the Best Cheddar award for its 2012 Makers Reserve, while Foremost Farms won the best Italian Cheese for its Mozzarella. Prairie Farms won the Best Cottage Cheese competition and also gained the most ribbons among co-ops participating in the contest, with 18. 

Cooperative Spirit Promotes Dairy’s Progress

Posted on by Theresa Sweeney

October is significant in the NMPF calendar. Many years, including this one, it features our annual meeting, when dairy farmers gather to share a common voice on important policies and represent the best practices and advances this industry has to offer. It’s also National Co-op Month, a time dear to our own hearts as the nationwide federation of dairy cooperatives. The principles of self-help and pursuit of common goals that cooperatives embody are core values of our organization, ideals we see lived by our members every day.

A very public example of how co-op leadership combined with sound public policy can advance dairy and serve broader communities came in September, as NMPF members received a significant portion of USDA’s $2.8 billion in funding for 70 projects in the first round of awards under the department’s Partnerships for Climate-Smart Commodities initiative. California Dairies Inc., Dairy Farmers of America, Land O’Lakes, and the Maryland & Virginia Milk Producers Cooperative Association are leading or partnering on specific projects that may receive up to $245 million in funding that will further industry goals on greenhouse gas emissions reductions, optimal resource use and sustainability.

These member cooperatives, along with others in dairy who are building a better future through climate-smart agriculture projects, should be commended for taking a proactive approach to continuing dairy’s leadership within all agriculture. Following on the heels of the Inflation Reduction Act — which promises more opportunities for solutions that create both a more sustainable planet and a sustainable future for many dairy farms — it’s a powerful investment, and a significant signal from USDA that co-ops have the tools to succeed in meeting 21st century challenges.

Speaking of challenges … anyone who has followed industry discussions since the 2020 pandemic knows of the need to modernize the Federal Milk Marketing Order system, as well as NMPF’s leadership in crafting a plan that can gain broad-based support from farmers across the country. After more than a year of examination of important and relevant issues by our Economic Policy Committee, along with a task force created to craft consensus on critical topics, and wide-ranging discussions with our leadership and throughout the industry, we’ve gained important insights into what changes are critical and which ones need extra attention to get right.

For example: Any solution that works for farmers and the entire industry needs to address FMMOs comprehensively. Milk-pricing formulas, to name one area, need to reflect milk component composition in 2022 – not the lower levels assumed by the industry experts of nearly a quarter century ago. Pricing formulas also should better reflect what dairy products are being sold in 2022 so that price reporting covers the right markets, in the right proportion for a fair price. At the same time, addressing make-allowances — which haven’t been adjusted in nearly 15 years and don’t fully reflect present-day manufacturing costs — is important.

It’s also clear that changes made to FMMOs must be implemented gradually enough to keep markets calm. Most importantly, solutions need broad buy-in from farmers first, closely followed by everyone else. Proposals that have advanced from our task force are ones that had strong support among many of the experts who crafted them, ensuring that a firm consensus stands behind our proposals.

To some, that may slow down progress; but proposed progress that ends up being eventually rejected leaves everyone back where they started. Our goal is to move forward and forge lasting solutions work for all regions of the country, all sizes of farms, and perspectives from across dairy.

We’ve come a long way toward meeting that goal, in no small part due to the ethic that we, as a federation of cooperatives, follow of making sure that our efforts benefit all. But our work is far from over: Any plan we advance will need to go before a USDA-directed federal order hearing – we’re aiming for next year – that would be subject to a producer vote on a modernized FMMO system, if USDA approves a plan. In the meantime, as our members create consensus, we’re also consulting with other farmer groups, other industry organizations, and experts from across dairy to make sure our proposal addresses widely shared concerns and attracts wide support.

As the largest dairy-farmer organization in the United States, as well as the one that, due to the structure of cooperatives, also represents farmers invested in their own milk processing capacity, we’re well positioned to lead Federal Milk Marketing Order system modernization, and we’re looking forward to discussions that yield a proposal that will nourish this entire industry for a generation, and potentially beyond.

That is how our members lead, and that’s what we will celebrate, both at our annual meeting, throughout National Co-op Month, and as we move forward on FMMO modernization. The work is never-ending. But neither is our progress.

Jim Mulhern

President and CEO, National Milk Producers Federation

Task Force Recommends Next Steps in FMMO Modernization Work

Posted on by Theresa Sweeney

The task force of milk marketing experts from across NMPF’s membership met May 12 to review and approve a series of recommendations about how to improve the Federal Milk Marketing Order program.

The meeting at NMPF’s office was the next step in refining proposals to modernize and improve the price determination under the FMMO system. The Task Force reached unanimous agreement on a number of recommendations for improving our current pricing system and is expected to make several more recommendations before its work concludes.

The full NMPF Economic Policy Committee will review the Task Force’s proposals at their next meeting on June 6th, followed by a Board of Directors review of the proposals at their meeting June 7-8. NMPF will conduct additional member and industry stakeholder outreach over the summer.

NMPF’s Bjerga on the Dairy Economy, FMMO Modernization and Fake Milk

Posted on by Alan Bjerga

 

NMPF Senior Vice President for Communications, Alan Bjerga, discusses dairy issues ranging from pricing to fake milk with KASM radio of Albany, MN, at the National Association of Farm Broadcasters Issues Forum in Washington, DC. Record milk prices are coming with higher costs as well; meanwhile, NMPF is positioned to lead on Federal Milk Marketing Order modernization, a farmer-led process.