The U.S. Department of Agriculture’s hearing to consider proposals to establish a Federal Milk Marketing Order for California began on September 22, in Clovis, Calif. Bob Yonkers, IDFA vice president and chief economist, is attending the hearing and providing periodic updates for members.

September 30, Day 7, began with a seventh USDA staff witness introducing a chart (Hearing Exhibit 29) detailing the product classification differences between current Federal Milk Marketing Order (FMMO) regulations and those of the California Department of Food and Agriculture (CDFA). The remainder of the day consisted of continuing cross examination of the first witness for proposal 1, Elvin Hollon, Dairy Farmers of America (DFA) director of fluid marketing and economic analysis.

At the end of the day, proponents of proposal 1 from the three cooperatives indicated there will be at least eight more witnesses before their testimony is completed; it was not made clear if that included additional appearances by Hollon, who noted earlier that he had partitioned his testimony into three segments. So far, part one of Hollon’s testimony has detailed the differences between CDFA/California class prices, blend prices and all milk prices, and the 10 current FMMO areas.

October 1, Day 8, was spent on testimony and cross examination of proposal 1’s second witness, Thomas Wegner, a director of economics and dairy policy for Land O’Lakes. Wegner focused on provisions in proposal 1 that are the same or very similar to those found in current FMMO areas.

October 2, Day 9, began with a brief appearance by a prior USDA witness to introduce some data requested earlier in the hearing by proponents of proposal 2. This was followed by the third witness for proposal 1, Eric Erba, senior vice president and chief strategy officer of California Dairies, Inc. (CDI). Dr. Erba recounted the history of the California quota program and its operation by CDFA, as well as how the California quota program would operate if an FMMO was established for California under the provisions outlined in proposal 1. Cross examination of Erba will continue on Monday, October 5.

Cross examination of all three witnesses for proposal 1 so far has focused in part on statements they made at prior regulatory hearings in California and/or in published articles. The quotes included noting the need to insure that regulated minimum prices must be set at levels that allow manufacturers of dairy products to cover all costs of processing and marketing, as well as the recognition that wholesale dairy product prices in California were lower than in other parts of the United States.

Since the first week of the hearing, the size of the audience in the hearing room has dwindled to approximately 30 people per day. In part, this is due to the departure of some USDA staff members who completed their testimony, and some of the earlier attendees may be listening to the audio cast of the hearing online. Some hearing participants are beginning to believe the hearing will not be completed by the end of October and may run well into November.

If you’d like to receive these updates by email, contact Molly Pfaffenroth, IDFA legislative assistant, at mpfaffenroth@idfa.org.