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  December 17, 2010

Dairy Price Reform?

Everyone by now is aware that National Milk Producers Federation (NMPF) has a multi-piece package of reforms called Foundation for the Future (FFTF). In addition to NMPF’s concept of production management and revenue insurance based on “margins,” the FFTF also includes a piece on dairy pricing reform.

During a recent teleconference by the 15 organizations that funded the dairy economists’ study of FFTF and two other plans, NMPF CEO Jerry Kozak had indicated that the price reform piece is still in the board’s subcommittee for finalizing.

As of Dec. 15, NMPF reports progress has been made, but that this part of the FFTF will not be available until mid-January as it is still in the board’s subcommittee.

Indications are that the FFTF price reform piece is still moving toward a competitive pricing scenario for manufacturing class milk, which would, in effect, eliminate the “set” make allowances. Price discovery is part of this discussion as the milk price is currently discovered by a formula that uses the NASS-reported end-product prices and then deducts a “set” make allowance. Stay tuned.

Political power?

Who has power in Washington? It may surprise you to know that California Dairies Inc. (CDI) was the very top dairy Political Action Committee (PAC), giving nearly half a million dollars to the political campaigns this year of would-be senators and representatives in 19 states, according to data released at the end of November and posted at opensecrets.org. Following as a close second was Dean Foods.

Here are the top 10 dairy PACs and their amounts: CDI $462,500, Dean Foods $448,000, DFA $318,200, Land O’Lakes $255,300, International Dairy Foods Assn (IDFA) $179,000, National Milk Producers Federation (NMPF) $93,300, Associated Milk Producers $70,000, Western United Dairymen $43,299, Agri-Mark Inc. 32,750, Dairylea Cooperative $13,850.


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