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AFBF asks USDA for emergency dairy formula change

The American Farm Bureau Federation asked the USDA to make an emergency milk price formula change to prevent further financial losses for producers.

Economist Danny Munch tells Brownfield Farm Bureau generally opposes legislative overrides, but with the fallbacks of the “average of” Class I price mover, they want USDA to move back to the older “higher of” formula in the most expedient manner possible. “Even in the past two months, over 90 million dollars in pool-associated losses because of the formula switch. This puts us as an industry for pooled farmers at over 1.05 billion dollars in lost pool value since the formula change went into effect.”

Munch says the American Farm Bureau Federation read a letter to Secretary Tom Vilsack and Deputy Administrator Dana Coale during the final day of the hearing on the Federal Milk Marketing Order system.  He says the emergency change is needed because the present formula is hurting farmers. “Each month that there aren’t many changes implemented, it means continued losses for our farmers, so we’re really hoping the USDA responds to that emergency request for that particular change.”

Munch says he believes USDA has the authority to make the formula change without new legislation from Congress.  He says all the groups representing farmers support returning to the “higher of” Class I price mover, and the change is needed now knowing the process for changing the federal orders might take another year to finish.

Audio: Economist Danny Munch with the American Farm Bureau Federation discusses the end of the hearing on federal orders and their emergency request for changing the Class I mover formula back to “higher of” as soon as possible.