Co-op pushes for USDA to revert to an old milk pricing order
The Farm First Dairy Cooperative wants USDA to revert to an old milk pricing order.
Currently, the Class 1, or fluid milk price, is determined by an average of the Class 3 and 4 prices.
Class 3 refers to milk used for cheese; class 4 is butter and powdered dairy. The old standard used the higher price of the two to set Class 1 prices.
The co-op’s general manager says that the proposal goes back to changes made in the late 1990s.
“We just think that that’s worked well over time. The last change was a legislative change in the 2018 Farm Bill, and the one back in 1999 had support of the industry, it worked well,” Jeff Lyon states. “Is it perfect? Probably not, but we think it’s worked well. And, if USDA decides to have a hearing on the Class 1 mover issue, we want to have that proposal as part of the discussion, too.”
The issue stems from negative producer price differentials last year, driven by the volatile markets.