New Report Lays Out Priorities for Dairy Reform

A new report compiled by the American Farm Bureau Federation lays out priorities, principles and recommendations for dairy policy reform.

The Farm Bureau Dairy Working Group, comprised of 12 dairy farmer representatives (three from each of the four Farm Bureau regions), explored options for strengthening the dairy industry through the 2023 farm bill and modernizing the current Federal Milk Marketing Order system. AFBF also received input from a first-of-its-kind industry-wide Federal Milk Marketing Order Forum held in Kansas City, Missouri, in October 2022. The forum was hosted and led by AFBF.

When FMMOs were last reformed in 2000, the U.S. exported less than 5% of annual milk production, compared to 18% today. Per capita milk consumption has grown in the United States by almost 10%, but there are almost 50% fewer dairy operations now than in 2003.

“America’s dairy farmers continue to meet the challenges of growing demand for milk products, even while the number of dairy farmers in the United States continues to shrink,” said AFBF President Zippy Duvall. “The recommendations put forth by the 2022 Dairy Working Group convey the needs of dairy farmers across the country. The report provides guidance to USDA as the department prepares for future hearings to modernize the FMMO system and to lawmakers as they begin drafting the next farm bill.”

The report reflects the consensus of Dairy Working Group members and informs AFBF’s grassroots policy development process.

Priorities for FMMO reform include:

• Return the Class I mover to a “higher-of” formula;
• Increase Class I differentials to reflect changes in the marketplace;
• Make cost surveys mandatory and audited by USDA;
• Tighten pooling provisions;
• Update make allowances routinely with mandatory cost surveys;
• Expand the number of products used in USDA’s pricing survey;
• Simplify milk checks; and
• Use modified block voting instead of bloc voting.

Non-FMMO priorities include:

• Increase catastrophic margin levels within the Dairy Margin Coverage program;
• Clarify AFBF production history policy within the Dairy Margin Coverage program;
• Support premium alfalfa milk cost updates within Dairy Margin Coverage;
• Support a change in dietary guidelines to include whole milk and full-fat dairy products; and
• Shift jurisdiction of food programs for children in schools (including milk) to the Committee on Agriculture.

Read the 2022 Dairy Working Group report here.