IDFA champions reform in dairy pricing policies

Jan 31, 2024

By: Farms.com

The International Dairy Foods Association (IDFA) has proposed significant updates to the Federal Milk Marketing Order (FMMO) pricing formulas, seeking alignment with the evolved dairy industry landscape. Mike Brown, IDFA's chief economist, highlighted the industry's growth and the emergence of new challenges since the last FMMO revisions in 2008.

IDFA's proposals, part of the recent National FMMO public hearing, include modifying make allowances and Class I milk pricing. These proposals are aimed at better mirroring the costs of milk processing and supporting fair compensation for both dairy farmers and processors.

The make allowance proposal suggests gradual increases based on recent industry studies, reflecting the rising costs of manufacturing dairy products.

The Class I Mover proposal by IDFA is designed to ensure dairy farmers receive fair payments, while allowing processors to effectively manage price risk. This proposal is expected to enhance the sales of Class I products, which have been declining.

IDFA's efforts represent a comprehensive approach to dairy industry reform, involving extensive internal discussions and stakeholder engagement. The organization's focus remains on achieving a balanced outcome that benefits the entire dairy supply chain.

As the dairy industry awaits the USDA's decision following the hearing, IDFA continues to advocate for regulatory changes that accurately represent today's dairy markets. The outcome of this process is pivotal, not just for current dairy businesses but also for shaping future policies in the sector.

IDFA's role in this transformative period highlights its commitment to a dynamic and sustainable dairy industry.

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