USDA Issues Final Rule On Federal Milk Marketing Orders

USDA published a final rule last week in the Federal Register amending the uniform pricing formulas applicable in all 11 federal milk marketing orders. This comes after an almost 18-month-long process.  

The rule includes the following pricing formula amendments: 

• Returning the base Class I skim milk price formula to the higher-of the advanced Class III or Class IV skim milk prices for the month. In addition, adoption of a Class I extended shelf life (ESL) adjustment for all ESL products equal to the average-of mover plus a 24-month rolling average adjuster with a 12-month lag. 
• Updating the Class III and IV manufacturing allowances for cheese, butter, nonfat dry milk and dry whey, and the butterfat recovery factor. 
• Updating the Class I differential values to reflect the increased cost of servicing the Class I market. 
• Updating skim milk composition factors, with implementation delayed six months. 
• Removing 500 lb. barrel cheddar cheese prices from the Dairy  Product Mandatory Reporting Program survey.