The American Farm Bureau Federation (AFBF) has raised significant concerns about potential changes to the Federal Milk Marketing Orders (FMMO) that the USDA is considering.

In a recent communication to Agriculture Secretary Tom Vilsack, AFBF President Zippy Duvall highlighted worries that these modifications could disrupt the fairness integral to the FMMO system, which is designed to balance the interests of dairy producers and processors.

Key issues include the proposal to not adjust the Class II differential, the creation of a new milk class for extended shelf life (ESL) products, and delays in updating milk composition factors. Such changes, Duvall argues, could jeopardize the economic sustainability of dairy operations across the country.

Particularly troubling for the AFBF are the proposed increases in make allowances—costs factored into price formulas to cover manufacturing expenses—which they argue are based on unreliable data. This could lead to foundational shifts in pricing structures not adequately reflecting the realities of dairy production.

Despite these concerns, there are aspects of the proposed changes that the AFBF supports, including the reintroduction of the “higher-of” pricing mechanism for Class I milk, increased Class I differentials, updated composition factors, and the elimination of 500-pound barrels from key dairy reports.

The AFBF’s advocacy highlights the need for careful consideration of these policies to maintain trust and fairness in the dairy market, ensuring that both producers and processors can continue to operate effectively within this regulatory framework.

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