Interpretive Summary: FMMO hearing set for August

By: Sydney Sheffield

The United States Department of Agriculture (USDA) has set August 23, 2023, as the date for the hearing to revise the Federal Milk Marketing Order (FMMO) system. If all goes to plan, an updated FMMO system could be actively benefiting farmers in late 2024. The announcement comes after the National Milk Producers Federation (NMPF) and the American Farm Bureau Federation (AFBF) sent a proposal urging USDA to modernize the FMMO system.

“We’re gratified that USDA recognizes the comprehensive nature of our proposal and are looking forward to it being considered in full because the whole of our plan adds up to more than the sum of its individual parts,” said NMPF President and CEO Jim Mulhern. “We will bring the same level of dedication and preparation to this part of the process that we did in drafting our own plan, which included more than 150 meetings and wide consultation across dairy producers and the entire industry.”

The NMPF and AFBF proposal included: 

• Updating dairy product manufacturing allowances (the “make allowance”) contained in the USDA milk price formulas
• Discontinuing the use of barrel cheese in the protein component price formula
• Returning to the “higher of” Class I mover
• Updating milk component factors for protein, other solids, and nonfat solids in Class III and Class IV skim milk price formulas
• Updating the Class I differential price system to reflect changes in the cost of delivering bulk milk to fluid processing plants

Following the proposal, USDA released an action plan and is considering initiation of a rulemaking proceeding that would include a public hearing to collect evidence regarding proposed changes to pricing provisions effective in all eleven FMMOs. USDA accepted additional proposal requests, held a virtual pre-hearing information session, and requested modified proposals this month. In Late July, USDA will publish the hearing notice in the Federal Register, with the tentative hearing date of late August, 

“Modernizing the Federal Milk Marketing Order system has been due for some time; the pandemic experience, which exposed fault lines in the system, underscored just how necessary this effort has been and created the impetus for change. We’ve been deliberate in our approach because we wanted to make sure that we addressed the concern that Agriculture Secretary Vilsack stated well over a year ago when he said it was important to have consensus within the producer community,” Mulhern said.