Federal Milk Marketing Order in California in Effect Nov. 1

Questions Arise Regarding Milk Quota

Edited by Patrick Cavanaugh

Dairymen and women throughout California are working hard to provide milk and other dairy products for consumers in California and the world. Because the industry has struggled over the past decade with price swings that have often landed dairies in red, many dairies have gone out of business. Still, other operations relocated to others states where regulations are a fraction of what they are in California.

In June 2018, California dairy producers voted to establish a new Federal Milk Marketing Order (FMMO) for the state. The vote was a paramount step in a long process that would culminate with the new order taking effect on November 1. The order will adopt the same dairy product classification and pricing provisions currently used throughout the FMMO system.

California accounts for more than 18 percent of U.S. milk production and is currently regulated by a state milk marketing order administered by the California Department of Agriculture (CDFA). Once this new FMMO takes effect, more than 80 percent of the U.S. milk supply will fall under the FMMO regulatory framework.

Western United Dairymen is a trade association based in Modesto. Annie AcMoody is the Director of Economic Analysis. She explained that there have been questions from the industry regarding the upcoming FMMO.

Among the often asked question revolves around when the state switches to FMMO in November, what will happen to their quota if a dairy ships milk out of state?

Annie AcMoody: When our California state system goes away to make way for the Federal Milk Marketing Order (FMMO) in November, the Quota Implementation Plan (QIP) will be the language in place to ensure the quota system’s smooth transition into the FMMO system.

When we enter that new world, all market milk received from California producers at a California plant will be assessed for quota. By “received”, the language defines “to convey milk physically into a milk plant where it is utilized within the plant, or stored within such milk plant and transferred to another plant for utilization. This means that a milk truck driver cannot drive by a plant, wave hello to an operator, and keep on going out of state and still call this milk received in California. Basically, if your California milk leaves the state, you will not be assessed for quota.

But you also will not be paid for it. But, if your milk is 60% quota and only 40% of your milk goes out of state, you will be assessed on 60% of your milk and get paid quota on that same 60%. If your quota covers 100% of your milk and 40% of your milk goes out of state you will be assessed on 60% of your milk and get paid quota on that same 60%. In this instance, one could wonder if it makes much sense to keep your quota.

While it may not make much economic sense to hold on to quota you are not paid for, some reasons may validate that decision (perhaps it is expected milk will be shipped to a California plant in the near future). If you were to decide to hold on to that quota, it is important to keep in mind that “if quota is not made active by shipments of market milk to a California plant or cooperative association or is not transferred within the 60-day period, such quota shall revert to the Department”.

This excerpt from the QIP means that if your quota milk is not paid on for over 60 days, you will lose it, so you better sell it. This is likely going to be an issue if you ship to a proprietary plant and all your milk goes out of state. If you ship milk to a cooperative, there is more flexibility because that coop has the ability to combine quotas assigned to it by its members.

So as long as the quota total within the coop is not larger than the total amount of market milk produced and received in California, then there should be no issue for you as a quota holder.

What 
is 
defined 
as 
market 
milk?


Answer:
 Grade A milk.

If your milk is Grade B, you cannot have quota now and will not be able to under the QIP. You will not be assessed for it either. Currently, only around 3% of the milk in California is Grade B. WUD will keep an eye out on this topic to ensure that percentage does not deviate significantly. As a reassurance, this is not something that could grow from 3% to 50% in a month since fluid milk is not allowed to take in Grade B milk and the three largest coops in the state (CDI, DFA and LOL) committed to not taking in any more Grade B milk after the transition to the FMMO.

2021-05-12T11:17:09-07:00September 23rd, 2018|

2017 Tulare County Crop Report Tops $7 Billion

Tulare Crop Report Shows 10 Percent Growth in Single Year

By Patrick Cavanaugh, Editor

Big numbers announced today from Tulare County Ag Commissioner Marilyn Wright on the 2017 crop year.

“Our value is 10.5 percent up from last year, at 7,039,929,000. So, that’s 669 million more than the previous year,” Wright said.

Marilyn Kinoshita, Tulare County Ag Commissioner

Marilyn Wright, Tulare County Ag Commissioner

And, of course, more water in the system probably helped, as it did in Fresno County, which announced $7.028 billion in its 2017 Crop Report, released earlier this month.

The dairy industry, which is prominent in Tulare County, came in number one again, representing 25 percent of the total value.

“Milk prices were stronger in early 2017, but they went down later in the year. And they continue to go down, but still it was a big part of the Tulare County ag receipts in 2017,” Wright said.

Following dairy were grape products—including juice grapes, raisins, and table grapes. Table grapes had a stellar year.

Navel and Valencia oranges were next. Cattle and calves ranked fourth, down from category number three in 2016, because cattle prices were off last year.

Tangerines, also known as mandarins, were number five, followed by almonds, cling peaches, and freestone peaches.

Lemons, were ninth on the crop list.

We only have just over 10,000 acres of lemons in the County, Wright said.

Wright said the value of this year’s crop report, $7.39 billion, is the third highest value Tulare County has ever reported.

2018-09-18T16:39:21-07:00September 18th, 2018|

Hilmar Cheese Company Unveils Largest Dairy Mural in the U.S.

Scoop it Forward Event Collects Food for Hilmar Helping Hands 

News Release

Hilmar Helping Hands received thousands of food items on July 13 as part of a “Scoop it Forward” event to celebrate the official unveiling of the largest hand-painted dairy mural in the United States at the Hilmar Cheese Company Visitor Center.

Hilmar Cheese Company owners, employees, local officials and the community brought non-perishable food items to donate in exchange for a scoop of delicious ice cream made with Real California Milk as part of the mural celebration, which honors the partnership between the dairy industry and the local community.

“Dairy farm families are the backbone of many of our local communities,” said Jenny Lester Moffitt, California Department of Food and Ag Undersecretary. “But their impact goes well beyond that. They benefit the entire state—economically and by providing wholesome, affordable dairy foods.”

The mural is part of a national effort to celebrate the contribution of dairy farms and farm families to local communities. The Hilmar Cheese Company Visitor Center was selected by the Innovation Center for U.S. Dairy as one of seven locations across the nation to feature a custom mural as part of the Undeniably Dairy campaign. Undeniably Dairy is an industry-wide, national campaign that aims to increase consumer trust in the practices, principles, and people behind the dairy foods people know and love.

Standing 32 feet tall by 60 feet wide, the mural is a creation of muralist Ed Trask of Richmond, Va. The mural creation used 22 gallons of paint and 273 different colors. It depicts the Hilmar Cheese Company’s founding principles of farmers, family, community and faith—and its passion for Jersey cows. It also depicts a child’s journey from experiencing the visitor center as a youth and showing cows to discovering her devotion to dairy and pursuing a career in dairy innovation and research.

“This mural represents our values and foundation,” said Jim Ahlem, chairman of the Hilmar Cheese Company Board of Directors. “We are grateful to our local communities, our employees, the wholesome dairy foods we produce, the next generation of agricultural leaders developed through 4-H and FFA, and of course, the dairy farm families who ship their milk to us and the Jersey cows that produce it.”

“We appreciate that we were selected as one of the mural locations,” added David Ahlem, CEO and President of Hilmar Cheese Company. “We have thousands of families and school children visit each year. It’s important that people understand where their food comes from, and we hope this mural will bring a new connection to dairy.”

2018-07-19T15:31:50-07:00July 19th, 2018|

Young Dairy Owner Plans to Thrive in Future

Nevin Lemos Prefers Jersey Cows

By Patrick Cavanaugh, Editor

Nevin Lemos could be the youngest person to own a dairy in California. The 21–year-old owns Lemos Jerseys in Stanislaus County.

Lemos is a fourth-generation dairyman east of Modesto in the community of Lockwood. He grew up on his family’s dairy, and now he’s on his own. His family’s dairy is Lockwood III dairy, which is about five miles from his dairy.

“I’m 21 years old, and I decided to start my own. I wanted to expand the business, and get a little bigger so we can all stay in business, be competitive,” Lemos said.

“We have a plan someday to consolidate the two, and this was our way to grow.”

“It’s my baby here, my business, my passion here,” Lemos explained.

He thinks that it’s a good time to get into the dairy business.

“I’ve had some dairyman that I look up to, and they gave me some advice that even though the milk price is down, this is the best time to get started,” he said.

“That’s if you can … weather through some of the bad times because it’s a long-term investment. This is not a business that you get into for a short while, so if you can buy the cattle at a reasonable price and keep that input down, you’re in pretty good shape,” Lemos said.

His operation is 400 Jersey cow dairy with a double six-herringbone parlor.

“You know, my parents have the Holsteins. I’ve grown up around the Holsteins all my life. I showed Holsteins in 4-H growing up and love the Holstein breed but decided to go with the jerseys for a few reasons. One is they’re high in fat and protein components. I ship to Hilmar Cheese, so there’s good incentive there to get a premium off the fat and protein. Also with the reproduction, the Jerseys breed back so well.”

Lemos said he gets a 30% pregnancy rate.

A lot of the dairy cow feed is grown around the dairy operation.

“My landlord farms the 50 acres with the dairy. And I purchase the feed from them,” Lemos said. “Of course, that’s one of the significant inputs into the dairy. Feed is a bit of a high right now with exports. I put all my corn silage in Ag-Bags … to minimize my shrink, and that’s been going pretty well.

Lemos said in June, he can say he’s been going after it and his dairy for one year, and he knows he’s going to keep on going.

“I will most definitely keep going. Just getting started is the most challenging part, especially in a year like this year. I’m breaking even … if not slightly in the black. But I look forward to seeing what it does in years to come,” Lemos said.

Just building the herd and establishing it, Lemos is going to sit on some money for a little while before he starts to see it again.

Still, he said of operating his own dairy at 21 years old, “It’s the dream, my passion, it’s really what I love, and I would not have it any other way.”

2021-05-12T11:17:09-07:00April 24th, 2018|

Trade Must be Fair for America

Ray Starling, Special Assistant to Trump, on Trade

By Patrick Cavanaugh, Editor

Ray Starling is Special Assistant to President Trump for Agriculture Trade and Food Assistance. He was the keynote speaker at the 2018 Citrus Showcase hosted by California Citrus Mutual.

He spoke about addressing imbalance in trade.

Ray Starling, left, with Joel Nelsen of California Citrus Mutual.

“The thing that the president wants to do is to address some of the imbalance that we have. We go out and negotiate these agreements,” Starling said. “We say that we’re all agreeing to the rules of the road and then all of a sudden in the middle of trading, when we will have almonds on a boat or we’ll have pork on a boat or have fruit on a boat and all of a sudden, we find out the rules have changed. That is not the kind of trade we’re talking about. We want to sort of fix those inequities, if you will.”

NAFTA also needs to be looked at closely.

“There are a number of chapters in the agreement and a lot of the things that we need to fix on agriculture, we have worked out,” Starling explained. “Some of those are things that are never going to make the news. They are agreements and understandings about maximum residue levels of pesticides. Their understanding about what is the tolerance of foreign matter in material that we may be shipping to Mexico or Canada.”

“But on the big issues for ag that we’ve still got to make progress on: One of those is with Canada, and it deals with the dairy issues,” Starling said. “They supposedly have a supply management system where they limit the amount that they produce in the country to get a higher price, but yet a lot of their products still ends up on the international market, so our point is if you’re going to have a supply management system, it’d be great if you actually manage your supply and then didn’t dump that product out on the world market to compete with American product out there.”

Enforcement is also a concern, noted Starling.

“I wouldn’t say that it has to be a sequential process like that. I mean, we’re always going to look for new agreements and new opportunities, but I think that often when we look at the way we’re resolving disagreements about trade, it’s a very long process,” he said.

“It takes years to go to the WTO and to get a successful outcome, and we’ve gotten many successful outcomes at the WTO, which some would argue is actually a sign that that system is not that successful because notwithstanding the fact that we keep winning there, we keep having to go there to get these solutions,” Starling explained.

Photo Credit: Port of Oakland

2018-03-17T12:35:22-07:00March 16th, 2018|

Real California Dairy Stories Told

California Milk Advisory Board Rolls Out New Social Media Series

By Aiden Glaspey, Editorial Intern

The California Milk Advisory Board, based in Tracy, recently released a new social media series called Real California Dairy Stories. California Ag Today spoke to Jennifer Giambroni, the director of communications with the California Milk Advisory Board, about the project.

“It’s a series of short, analyzed videos with our dairy families because when we talk to consumers, it’s really sharing the story, not just about the food, but about the families. So it’s all about returning to real. Real foods from real families, kissed by the California sun.”

Giambroni said the dairy food story is easy to tell.

“Obviously everyone loves dairy products. They love dairy foods. But we really want to get to know the farmers behind the seal. Why do you care if you buy that Real California Milk product? It’s because you’re supporting actual dairy families.”

“So Real California Dairy Stories goes into the field with our California Dairy Families, and just tells little ‘moment in time’ stories. We just launched this on our social media platforms. They’re all on our YouTube channel at Real California Milk,” Giambroni said.

And another place to view those unique videos is at the RealCaliforniaMilk.com website.

2017-09-02T23:11:57-07:00September 1st, 2017|

Caution Advised on USDA Proposal

California Dairies Cautious On USDA Proposal

By Jessica Theisman, Associate Editor

California Ag Today met recently with Kevin Abernathy, the general manager for Milk Producers Council. Milk Producer’s Council is an advocacy organization trying to make sure the dairies in California are being treated correctly. The MPC has been working for a long time to ensure that the California dairies are well taken care of. Especially when it comes to the USDA proposal to add the California dairy industry into the Federal Milk Marketing Order (FMMO).

Kevin Abernathy, Manager of Milk Producers Council

“MPC has been an advocacy group on behalf of California dairy families since 1949. This FMMO process is something we have been akin to since the start of it,” Abernathy said. “It was the early leadership of MPC that started the process of adding  twenty-some odd years ago. Then the work evolved into work done by Sye Vanderdusson, Jeffery Vandenheuvel and Rob Vandenheuvel, with their growth management plans, which lead to the Holstein plan, which got evolved into the Foundation For The Future plan, which ultimately ended up where we’re at today.”

It is said that CDFA still has the upper hand in the situation concerning quotas and pay. The MPC is taking a look into these concerns.

“If this was something that was announced by CDFA because we have the experience in working in the California system, it is easy for us to calculate and the compute the outcomes. … So that is the process that we are going through right now and understanding how this thing works,” Abernathy said.

 

 

2021-05-12T11:17:10-07:00March 20th, 2017|

Celebrating California Agriculture . . . on World Vegan Day!

Celebrate World Vegan Day!

Peterangelo Vallis, executive director of the Fresno-based San Joaquin Valley Wine Growers Association, has an insightful viewpoint on California agriculture. That’s why California Ag Today considers him to be our Ambassador of Agriculture, and we’re glad he’s on our team.

In Celebration of World Vegan Day, Peterangelo Vallis addressed the need for California farmers to think about and engage with all the people who eat fruits and vegetables, including vegans*, environmentalists and fringe groups:

Yellow Bell Peppers, world vegan day

Well, vegans and environmentalists eat more fruits and vegetables than anybody. Guess what we make?

Look, I love a juicy steak, the same as most people. But frankly, most of my plate is vegetables. If somebody is buying something, they’re buying vegetables, and they want fresh vegetables. Vegans can get those in California, because they’re close enough to us. Let’s face it, these are highly perishable items and they’re going out there. Yet, we tend to vilify the same people that are paying our bills by buying our stuff.

Criticizing vegans is crazy. You don’t see Louis Vuitton making fun of middle-aged women. It’s just not what happens because they want you to buy more bags.

Big Vegetable Bin, world vegan day

Everybody eats fruits and vegetables. If they don’t, they should, and vegans are just an extra boon to California Agriculture. Look, people eat fruits, vegetables, milk, cheese, meat, everything. Without people eating, we don’t have jobs. The more population growth, the more people who need to eat. These are our customers.

We do a terrific job of turning [vegans] off to us. Look, we should be their favorite people and favorite sub-set of the population. We help keep them alive and healthy, and with shiny hair and good skin, because they’re eating all of our ridiculously safe and clean foods that you really can’t get anywhere else in the hemisphere.


*According to the Loma Linda University School of Public Health, Department of Nutrition’s, “The Vegetarian Food Pyramid,” Vegetarian is a broad term meaning a diet that excludes meat, fish and poultry. Vegans are vegetarians who do not consume any dairy products, eggs or animal flesh.

2016-11-01T14:00:37-07:00November 1st, 2016|

Keeping the California Dairy Industry Afloat

The Necessity of Keeping the California Dairy Industry Competitive

 

By Brian German, Associate Broadcaster

 

 

Anthony Raimondo, an attorney with 15 years of experience working with farmers and farm labor contractors, is concerned the California government is placing the state’s agricultural industry at an economic disadvantage compared to other states. Raimondo used the California dairy industry as a prime example in which arbitrary in-state legislation is giving other states an advantage.
dairy cows

 

“The state government tells the dairy farmer how much they get to charge for milk,” explained Raimondo. “They have now raised minimum wage and overtime, with AB-1066 becoming law, but they do not tie any of that [added cost] to the milk price. Farmers will lose money,” he said.

 

“The California dairy industry is still fighting to be a part of the USDA’s Federal Milk Marketing Order (FMMO),” Raimondo continued. “But until that happens, the added costs are causing many California dairymen to weigh their options.”

 

Increasing government regulation is making it difficult for California dairies to compete with other states, Wisconsin in particular. Raimondo elaborated, “For many years, Wisconsin’s milk production was on the decline and California’s milk production was on the rise; that trend has now reversed. Wisconsin is now on the rise again and California is on the decline because our dairies can’t make it with the level of regulation and the level of cost,” he said.

 

“Some dairies have reduced hours to keep costs low,” said Raimondo. “Other dairies are closing either because they are going out of business or because they are moving to places like Idaho and Texas where the milk price is better and the cost profile is more favorable.”

 

The move to a FMMO would help even the playing field for California dairies. Raimondo warned there is a lot at stake if nothing is done to lower milk production costs in the number one Ag state. “We are going to lose a segment of agriculture that is 100% family farms. Family farming is one of those things that is precious to our state, and it can’t be brought back once it’s gone,” Raimondo said.

2021-05-12T11:17:12-07:00September 16th, 2016|

Tulare County Ag is Down But Strong

Tulare County Annual Crop Report is Down But Still Strong

 

By Patrick Cavanaugh, Farm News Director

 

The numbers are in for the 2015 Tulare County Annual Crop and Livestock Report.  Marilyn Kinoshita, Agricultural Commissioner/Sealer of Tulare County, reported, “We had an overall value of $6.9 billion, compared to last year, which was more than $8 billion,” which means the County led the nation in total crop value and dairy production, despite a decrease of nearly 14% in one year.

Tulare County’s top ten crops [crop value] in 2015 were:

  1. Milk
  2. Cattle & Calves
  3. Oranges- Navels & Valencias
  4. Grapes
  5. Almonds Meats & Hulls
  6. Tangerines – Fresh
  7. Corn – Grain & Silage
  8. Silage – Small Grain
  9. Pistachio Nuts
  10. Walnuts

Kinoshita explained, “Dairy is our number one industry here. Our milk production was off a little bit. We have fewer dairies in business now because of the low milk prices. Anytime your fresh market milk is off, that’s going to affect our overall value. A good 2/3 of that billion-dollar decrease came from the dairy industry. The price was low the entire year, as opposed to the year before.”

Marilyn Kinoshita, agricultural commissioner, Tulare County

Marilyn Kinoshita, Tulare County Ag Commissioner

 

Thus far, the reported 2015 county crop reports in the Central Valley are down this year. “Fresno County, for instance, was down 6.5% off its record $7 billion in 2014,” Kinoshita said.

 

“It has a lot to do with low water deliveries in Fresno and Tulare Counties,” she continued. “The smaller the water deliveries, the more efficient those growers have to be with that water. Anytime you’re pumping water out of the ground, it’s terribly expensive,” she noted.

 

“Some of our growers have had to decide, ‘All right, I’ve got this much water; I’m going to keep those blocks alive and I’m going to push an older block that isn’t producing as well.’ The returns aren’t as good as some of the newer plantings,” said Kinoshita.

 

Despite all of that, Kinoshita said agriculture does sit at the head of the table in Tulare County. “Yes, and we need a successful Ag industry to thrive here,” she said.

 

To view a video of the interview, click HERE.

 

Tricia Stever Blattler, executive director of the Tulare County Farm Bureau, noted the crop report demonstrates the strength of the agricultural industry. “I think every year when this crop report comes out, it is always a testament to the resiliency of this industry. This industry takes hard knocks, gets knocked down, then steps right back up to the plate and keeps swinging,” Blattler said. “The agricultural sector has a lot of outside challenges that impact the number that we see reported every year.”

 

Tricia Stever Blattler

Tricia Stever Blattler, executive director , Tulare County Farm Bureau

Blattler acknowledged the crop value numbers do not reflect net revenue for growers. “It’s always really important for our listeners to know that the crop value is a gross revenue number. When our Ag Commissioner steps to the microphone and speaks to our Board of Supervisors about this report each year, she’s reflecting values that are attributed to all of the gross revenue, and it’s not only the field value,” Blattler said.

 

“That gross number reported each year also represents our packing houses, our milk processing facilities—the creameries, the butter plants—the packing shedsall those other parts of our industry that [create] value in our industry,” said Blattler.

 

Blattler noted up or down, it’s all about the resiliency of farmers. “The industry has its years that are really blockbuster and it has its years when it falls back and we see a reduction acreage. We see reductions in surface water deliveries. The drought is still certainly playing a significant role in the numbers we’re seeing,” she explained.

 

With regard to surface water, Tulare County is in a bit of a unique position. “As an Eastside county, some of our water deliveries are not as subject to the situation that the Westside is in. In the same sense, we have some significant cutbacks that have been attributed to the San Joaquin River’s restoration and the biological opinions in the Delta—all have had an impact on the Central San Joaquin Valley [water] deliveries regardless of whether you’re Eastside or Westside.

 

“Also, as the exchange contractors either take greater deliveries of water or give up water, that also impacts the amount available to Eastside growers here in Tulare County,” she said.

 

In summary, 2015 Tulare Crop Report covers more than 120 different commodities, 45 of which have a gross value in excess of $1 million. Although individual commodities may experience difficulties from year to year, Tulare County continues to produce high quality crops that provide food and fiber to more than 90 countries worldwide.


Featured photo: Tulare County 2015 Crop Report

2021-05-12T11:17:12-07:00August 31st, 2016|
Go to Top