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Dairy farmers want Class I milk formula switched

A member of the American Farm Bureau’s dairy policy committee says changing the fluid milk pricing structure has been a widespread request from farmers during USDA’s hearing process.

“That’s probably one of the biggest priorities that we would like to see happen—pretty unanimous that it’s necessary among producer groups.”

Brian Preston tells Brownfield the formula was changed at the request of processors to mitigate risk, but market factors have left dairy farmers at a disadvantage.

“It cost a lot of money, it took money out of our milk checks and it continues to right now with Class III and IV so close together,” he shares.  “It’s not a huge problem at the moment, but it certainly can be.”

Preston also supports a mandated and audited survey of dairy processor make allowances.

“Milk is a very perishable product, so we need processing that’s always available and we need adequate processing,” he shares.  “The make allowance is supposed to help with that. It’s an adjustment that’s made to the price of milk to get from finished product to raw ingredient. Our biggest ask would be that it would be based on real numbers that are researched and audited by USDA.”

Preston says dairy farmers will have the final vote on USDA’s proposals following hearings which he hopes will result in positive changes.

Preston recently testified on behalf of the Michigan Farm Bureau and Michigan Milk Producers Association at USDA’s Federal Milk Marketing Order Pricing Formula Hearing in Indiana.