USDA announced Friday that it will likely establish a Federal Milk Marketing Order for the state of California. The agency will have a referendum for California dairy producers from April 2 to May 5, during which two-thirds of producers have to vote in favor of the FMMO for it to become official.
Marketing orders set parameters around the relationship between dairy farmers and processors, assuring them “a reasonable minimum price for their milk throughout the year,” according to USDA’s Agricultural Marketing Service. About 64 percent of fluid milk in the country is currently managed under one of 10 regional milk-marketing orders. California’s milk has not been incorporated into one of the existing marketing orders, and some producers have long advocated that the state should have its own marketing order.
The California FMMO would “recognize the unique market structure of the California dairy industry,” according to the USDA press release announcing the change. Adoption of the FMMO will increase baseline milk prices for the state’s dairy farmers.
California produces over 18 percent of the nation’s milk. USDA first conducted a hearing on whether to establish the California marketing order in 2015.