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).
“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.
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.
“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.
Proposed Federal Marketing Order Would Benefit California Dairy Farmers
By Brian German, Associate Editor
California gets hit the hardest when milk prices drop and it is the last state to recover from depressed dairy prices. The California dairy industry eagerly awaits a decision from the USDA regarding the move to a Federal Milk Marketing Order (FMMO). Chandler Goule, senior vice president of programs for the National Farmers Union, believes the state will gain from moving to FMMO.
“I think it will definitely be a win for the dairy industry,” said Goule, “and for our dairymen out there.” Goule anticipates increased participation in the margin revenue program that was incorporated into the FMMO.
Should the USDA hand down a positive determination, the move to a federal order would require a 2/3 majority vote from California dairy producers. “With California being so far from the corn and grain belt, even though you all produce a lot of food in California, it’s not necessarily feed additives for livestock,” Goule remarked.
Unfortunately, the FMMO has a much better chance of being voted in during a time when milk prices are low, according to Goule, as high milk prices may lessen voter turnout and sense of urgency.
“I’m definitely not advocating for low milk prices whatsoever,” Goule said. “We want high milk prices out there. The sooner we can get this vote done, the better off California will be, and the better off your milk prices will be. Then we can start working on this as a nation rather than 48 states—and California by itself.”
Converting California to the Federal Milk Marketing Order
By Patrick Cavanaugh, Deputy Editor
In Clovis last week, an historic USDA milk pricing hearing commenced to gather testimony from the California dairy industry, which for the most part, favors changing to the Federal Milk Marketing Order (FMMO). This represents an abandonment of the state marketing order which has been harmful to dairies since it was altered 10 years ago to disallow dairies from getting paid the same price for their milk and whey products.
William Francis, director, USDA Order Formulation and Enforcement, is involved in the formal rule-making process for marketing orders. Francis commented, “There’s been tremendous interest in a federal order for California and we are holding a formal rule hearing for the promulgation of a California FMMO. This is an historic event. For years, the state has operated a program. But, farmers have gotten together and invited us to come in for the state’s hearing.”
The hearing could last as long as eight weeks to review each of four proposals. Francis noted, “We are here as long as it takes. We want to make sure we have a complete and accurate record so there are no time constraints,” He said the USDA will post a transcript on their website, filter through all of the documentation and make a recommendation.
A comment period with a sufficient amount of time will follow the public announcement of the USDA decision. “Then we will generate a modified final decision,” Francis said. “By the time we complete that process, farmers will have the opportunity to vote on the modified decision through a referendum process, which could be up to two years away.”