Calif. Dairy Organizations Collaborate Regarding Quota Program

Groups Launch Exploratory Effort to Solicit and Analyze Proposals

News Release

Recently, the United Dairy Families of California, California Dairies, Inc., Land O’Lakes, Inc., Dairy Farmers of America, and the STOP QIP organization announced a multi-phase process aimed at soliciting and analyzing industry input on California’s historic quota program.

Included in this process is a series of meetings, starting later this month, open to all dairy producers and interested parties. These meetings are intended to solicit various pathways for the state’s quota program.

1) This multi-phase process includes three key parts: The Think Tank, Producer Feedback, and Analysis.

2) The Think Tank phase is for information-gathering from various segments of the dairy industry. This will include the meetings identified below, where producers will be able to voice their opinion and contribute ideas or concepts.

3) The Producer Feedback phase will allow producers to comment and challenge the ideas developed in the Think Tank phase.

In the Analysis phase, dominant ideas from the Producer Feedback phase will be analyzed for economic impacts, and legal pathways to adoption will be determined.

This process will be implemented with the assistance of dairy industry economist Dr. Marin Bozic and dairy market analyst Matt Gould. Dr. Bozic and Mr. Gould will be conducting an economic analysis of the proposed ideas.

The first series of meetings associated with the Think Tank phase are as follows:

● Tuesday, July 30 – 2 pm to 4 pm – Embassy Suites, Ontario

● Wednesday, July 31 – 9 am to 11 am – Heritage Complex, Tulare

● Wednesday, July 31 – 2 pm to 4 pm – Turlock Ballroom

● Thursday, August 1 – 9 am to 11 am – Washoe House, Petaluma

Meeting space is limited. All participants are strongly encouraged to register at

www.dairyfamilies.org/events

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.

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.”

FY 2014 Conservation Innovation Grant National Awardee

California Dairy Research Foundation (CA) $73,000

Improving Conservation Practice Adoption and Nutrient Management Plan Implementation through Utilization of Adapted Decision Support Tree eLearning Methods

California is home to 1.8 million dairy cattle, over 80 percent of which reside in the state’s Central Valley, an area rich in agriculture and responsible for nearly 20 percent of the nation’s milk supply. Central Valley dairy farms produce much of the forage necessary to feed their cows by utilizing manure nutrients to grow crops year-round. Cow manure is an important renewable resource used to fertilize crops, replenish soil nutrients and enhance soil quality.

Utilizing manure effectively is paramount to sustainable dairying and agriculture, but has been regulated since 2007. Regulatory requirements include the maintenance and implementation of both waste management and nutrient management plans.

The industry’s regulatory and environmental success depends on individual dairy producer ability to identify and adopt conservation practices and implement superior nutrient management to protect scarce surface and ground water resources. Multiple potential challenges exist which may prevent full implementation of all aspects of nutrient management and available conservation practices within a given operation.

Barriers are most often site-specific and require individual assessment of current systems, equipment and practices to determine optimal farm solutions. This project will develop, field-test and demonstrate the use of an electronically available teaching and learning (eLearning) system as an innovative approach to conservation practice adoption and nutrient management implementation. A proven decision tree support system will be adapted into an eLearning format to enable individual farm nutrient management needs assessment.

Its guiding principles will be communicating scientifically-proven yet practical, cost-effective options at various nutrient management system critical control points (decision tree nodes) to assist producers in identifying site-specific solutions for full nutrient management plan implementation.