FMMO reforms pass despite dairy industry concerns

AFBF calls for fairer make allowance practices

The USDA's implementation of the Federal Milk Marketing Order (FMMO) reforms has been officially approved, signaling a step forward for the dairy industry’s pricing structure. However, the American Farm Bureau Federation (AFBF) has voiced concerns, particularly regarding the make allowances that affect milk pricing for farmers.

Zippy Duvall, President of AFBF, welcomed the reforms but pointed out a critical flaw, saying, "However, the positive changes that will come as a result of these reforms will not be uniform for dairy farmers across the country and will be greatly offset by large, unjustified increases in make allowances."

The AFBF has been a staunch advocate for an overhaul of how make allowances are calculated, pushing for a shift to a mandatory, audited survey rather than the existing voluntary approach. This change aims to prevent the undervaluation of milk that harms dairy farmers financially.

With the approval secured in all 11 orders, the alternative—eliminating existing milk pricing regulations—was avoided, which would have left dairy farmers in a precarious position without federal order protections.

Highlighting the importance of fair practices, Duvall urged legislative action to ensure transparency and fairness in the FMMO system. "The FMMO system relies on fairness and transparency, and without a mandatory, audited survey of processing costs, dairy farmers’ checks will be reduced based on flawed and incomplete data," he remarked.

The ongoing dialogue and legislative advocacy reflect the dairy industry’s complex dynamics and the crucial need for fair pricing mechanisms to sustain US dairy farmers.