USDA issues final decision proposing updates to FMMO

The U.S. Department of Agriculture’s Agricultural Marketing Service has issued a final decision proposing updates to the pricing formulas used in all 11 Federal Milk Marketing Orders.

These changes, requested by the dairy industry, aim to revise uniform pricing formulas and factors and require approval through a producer referendum before implementation.

The decision includes several key updates: the delayed implementation period for revised skim milk composition factors has been reduced from 12 months to 6 months, a $0.0015 marketing cost factor has been added to all make allowances, the methodology for determining the nonfat dry milk make allowance has been modified, and certain county-specific Class I differentials have been adjusted. These changes reflect input from public comments and a reevaluation of the record evidence.

The final decision will be published in the Federal Register soon. Before any changes take effect, the Agricultural Marketing Service will conduct producer referendums across the 11 Federal Milk Marketing Orders. Producers who pooled milk on an FMMO in January 2024 are eligible to participate, voting for or against the proposed amendments.

Ballots will be mailed to eligible independent producers and qualified cooperative associations. To be counted, ballots must be postmarked by December 31, 2024, and received by January 15, 2025.

AMS will oversee the referendum process and has provided details on the hearing website. Additionally, AMS will host public webinars to explain the proposed changes and referendum process, scheduled for November 19 and November 25 at 11 a.m. ET, and November 21 at 3 p.m. ET. Links to the webinars, along with supplementary educational materials, are available on the hearing website.

The final decision follows a national hearing conducted from August 23, 2023, to January 30, 2024, in Carmel, Indiana. AMS reviewed testimony and evidence from 21 dairy industry proposals during the 49-day hearing. A recommended decision was issued on July 1, 2024, and published in the Federal Register on July 15, initiating a 60-day public comment period that concluded on September 13, 2024. AMS reviewed 128 public comments before finalizing the decision.

»Related: Op-ed: Dairy farmers should be wary of FMMO changes