Producer Resources

California Milk Marketing Order Proposed

USAgNet - February 17, 2017

The U.S. Department of Agriculture announced its recommended decision to establish a California Federal Milk Marketing Order. The marketing area of the recommended FMMO would incorporate the entire state of California. The recommended decision is based on the evidentiary record compiled as part of a public hearing held in the state in late 2015.

FMMOs are legal instruments that regulate the purchase of milk between dairy farmers and the first buyer. Where appropriate, the recommended California FMMO proposes adoption of uniform order provisions contained in the 10 current FMMOs. These uniform provisions include, but are not limited to, dairy product classification, end-product price formulas and the producer-handler definition. The proposed order would recognize the unique market structure of the California dairy industry through tailored performance-based standards to determine eligibility for pool participation. The proposed order provides for the recognition of producer quota as administered by the California Department of Food and Agriculture (CDFA).

California represents over 20 percent of all U.S. milk production and is currently regulated by a state milk marketing order administered by CDFA. Comments on the recommended decision will be accepted for 90 days after official publication in the Federal Register. After analyzing and considering public comments, USDA will issue a final decision.

USDA will hold a public meeting on Wednesday, Feb. 22, 2017, in Clovis, Calif., to answer questions relating to how the proposed California FMMO would operate and how the public can submit comments for USDA consideration.

Along with issuing this recommended decision, USDA will publish a Regulatory Economic Impact Analysis it conducted to determine the potential impact of regulating California milk handlers under a FMMO on the milk supply, product demand and prices, and milk allocation in California and throughout the United States. The entire hearing record, including the Regulatory Economic Impact Analysis, and details of the public meeting are available at www.ams.usda.gov/caorder.

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