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Press Release from the National Cheese Institute
Producer Lawsuit Challenging New Class III Rules (Washington, D.C. March 19, 2003) The National Cheese Institute (NCI), a constituent organization of the International Dairy Foods Association (IDFA), voiced its support for a producer lawsuit filed yesterday against the U.S. Department of Agriculture (USDA) that requests a preliminary injunction against USDA's new rules for Class III pricing under the Federal Milk Marketing Orders. The rules are intended to go into effect April 1. NCI will be filing an amicus brief this week in support of the lawsuit, which was filed in the U.S. District Court for the District of Columbia by the Northwest Dairy Association, the Northwest Independent Milk Producers Association, Tillamook County Creamery Association, Farmers Cooperative Creamery and Agri-Mark, Inc. NCI's amicus brief argues that the new rules proposed by USDA for the minimum price paid to dairy farmers for milk used to make cheese would cause federally regulated farmers to be placed at "a sizeable competitive disadvantage" to dairy farmers outside the federal order system - particularly producers in California. "Plaintiffs have demonstrated that the resultant injury would be substantial and irreparable," the brief states. "In the past, USDA has always recognized that federal order prices could not be significantly different than those outside the order," said IDFA Chief Economist and Policy Analyst Bob Yonkers. "This is particularly critical in the case of Class III, where the end products are not as perishable as other dairy products, and competition therefore exists on a national level. "We cannot overstate the importance of California's milk and dairy product production," Yonkers added. "Any significant increase in the already meaningful disparity between federal order and California prices is simply not sustainable." Rather than aligning prices within and outside the federal order, the rules that USDA plans to implement next month set a Class III price that is $0.55 per hundredweight of milk higher than the corresponding California state price - a disparity of more than 5% based on current prices. Class III milk (used to make hard cheese and cream cheese) is the largest class of milk by volume, accounting for over 44% of all milk regulated by the federal order system. California, which is outside the order, represents more than 20% of both milk production and cheese manufacturing in the United States. Click here to review the full NCI amicus brief (.pdf) # # #
IDFA is the Washington, DC-based organization representing the nation's dairy processing and manufacturing industries and their suppliers. IDFA is composed of three constituent organizations: the Milk Industry Foundation (MIF), the National Cheese Institute (NCI) and the International Ice Cream Association (IICA). Its 500-plus members range from large multinational corporations to single-plant operations, and represent more than 85% of the total volume of milk, cultured products, cheese, and ice cream and frozen desserts produced and marketed in the United States – an estimated $70-billion a year industry.
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