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Federal Ruling on Milk Price Regulations

16 August 2012

US - A final decision on milk price regulations says that producer-handlers with more than three million pounds of Class I sales per month are subject to federal order pricing and pooling regulations in all federal milk marketing areas.

Two years ago, the US Department of Agriculture announced a final decision to make milk price regulation more consistent for all dairy processors, including producer-handlers who own farms and process milk. IDFA supported the decision, the referendum passed and the new rules have been in effect since June 1, 2010. But the story didn’t end there.

One producer-handler continued to fight the decision through administrative channels at USDA, just recently exhausting all appeal opportunities with the department. IDFA filed briefs at every step in the appeals process to support USDA and its decision to reject the challenge in IDFA's favour.

The only remaining avenue for the producer-handler was legal action, but the deadline for filing a court challenge passed last week without a lawsuit being filed. The two-year challenge came to a close with the regulations left intact.

The final decision says producer-handlers with more than three million pounds of Class I sales per month are subject to federal order pricing and pooling regulations in all federal milk marketing areas. The limit exempting any handler from pricing and pooling provisions remained at 150,000 pounds of Class I sales (combined route dispositions and sales to other handlers) per month or less.

"This clearly is a victory for IDFA and the National Milk Producers Federation, which worked with us to correct provisions that had created disorderly marketing conditions. But now it's time for bigger, bolder changes," said Bob Yonkers, IDFA vice president and chief economist.

"The Federal Milk Marketing Orders, the government's complicated regional milk pricing system, must be phased out. They keep milk prices high for consumers already struggling in a tight economy, and millions of dollars are being spent needlessly by consumers and taxpayers as a result of this outdated regulatory scheme," Mr Yonkers said.

TheMeatSite News Desk



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