Sponsored By

California dairy producers seek USDA action on marketing orderCalifornia dairy producers seek USDA action on marketing order

USDA said Supreme Court proceeding on administrative judges is holding up its decision on a federal milk marketing order.

Jacqui Fatka

February 10, 2018

3 Min Read
California dairy producers seek USDA action on marketing order

The U.S. Department of Agriculture is being urged to move forward in the rule-making process for the establishment of a federal milk marketing order (FMMO) in California by releasing its final decision.

“Given the number of dairy operations that have closed in California and the chronic decline in milk production here, the more than three-year rule-making process for a FMMO in California should not be delayed,” according to a letter from the California Dairy Campaign, Milk Producers Council and Western United Dairymen.

Earlier in the week, it was revealed that USDA was waiting to make a decision on the marketing order until the Supreme Court renders a decision on the Lucia vs. Securities & Exchange Commission case, which has to do with administrative law judges (ALJs). Judge Jill S. Clifton, the judge who proceeded over the 2015 California hearing proceeding in Clovis, Cal., was an administrative law judge.

Annie AcMoody, Western United Dairymen director of economic analysis, explained that, in short, there is ambiguity around ALJs and if they should be nominated or simply appointed. According to USDA’s release, “at the time of the hearing, USDA believed ALJ Clifton to be an employee of the department, and her appointment was completed in accordance with agency procedures. However, if the court determines that ALJs are inferior officers of the United States rather than employees, then ALJ Clifton’s original appointment as an ALJ would be brought into question.”

Related:California dairy groups file emergency price increase petition

The letter to Secretary of Agriculture Sonny Perdue detailed the harsh times facing California producers. During the past three years, margins on California dairy operations have been negative. As a result of recent economic conditions, California lost 171 dairies, representing 11% of the industry, during the four years ending in 2016, and it expects that a similar trend will be confirmed for 2017 when California Department of Food & Agriculture data are released.

The latest data (third quarter of 2017) showed a loss of 64 cents/cwt. of milk produced. While costs may not have moved much since then, the price of milk dropped by $2/cwt. in January 2018.

“The grim economic situation facing California dairy producers demonstrates the urgency of moving forward in the FMMO processing by releasing the final USDA decision,” the letter noted.

According to USDA’s “Regulatory Economic Impact Analysis of the Recommended California Federal Milk Marketing Order,” the all-milk price estimated change from the baseline for California would be 48 cents/cwt. The numbers illustrate California dairy families’ eagerness for a final decision to consider.

“While we can recognize USDA’s inclination to wait for the Supreme Court decision in the Lucia vs. Securities & Exchange Commission, before publishing a final decision on a California FMMO, it is not something we can support,” the letter concludes. “California dairy producers cannot wait until the Supreme Court renders a decision on this matter, which ultimately may not prove relevant to the FMMO proceedings. We urge USDA to release the final decision so that California dairy producers who are suffering under the uncertainty the delay in this process is creating have the opportunity to consider a pricing system that will be in alignment with rest of the major milk-producing regions in the country.”

About the Author(s)

Jacqui Fatka

Policy editor, Farm Futures

Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.

Subscribe to Our Newsletters
Feedstuffs is the news source for animal agriculture

You May Also Like