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Message from the President

March 11, 2019

Message from the President on 2018 Farm Bill

Dykes_Michael_cropI am pleased to report that the U.S. Department of Agriculture’s Agricultural Marketing Service (AMS) published a final rule today to implement the Class I mover change that IDFA and the National Milk Producers Federation jointly asked Congress to include in the 2018 Farm Bill.

The rule amends the Class I skim milk price formula for milk pooled under the Federal Milk Marketing Order system. Under the amended price formula, the Class I skim milk price will be the simple average of the monthly advanced pricing factors for Class III and Class IV skim milk, plus $0.74 per hundredweight, plus the applicable adjusted Class I differential.

The rule will become effective May 1, 2019, as required by the statute. When the Advanced Class I Skim Milk Price for May is announced on April 17, 2019, the new calculation will be used and reflected on the price announcement.

AMS has posted a Notice to Trade, "USDA Announces Amendment to Class I Skim Milk Price Formula," with more details. AMS’s Market Administrator Offices also will notify interested parties, which includes the producers, cooperatives and handlers associated with their respective markets.

This rule represents a significant accomplishment that will benefit the entire dairy industry. As I’ve said since I joined IDFA, we are going to be more effective in achieving our policy goals by working together – processors and producers – to come up with policy proposals that we can all support.

I want to thank all of our IDFA members who were involved in the discussions that led to today’s positive outcome.

I also want to thank the leadership at NMPF for the great collaboration, and the AMS dairy team, led by Dana Coale, deputy administrator of the AMS Dairy Program, for working so closely with us during this entire process.

IDFA will keep you updated on these changes. In the meantime, please let me or Dave Carlin, IDFA senior vice president of legislative affairs and economic policy, know if you have any questions. 

Sincerely,

signature Dykes
MICHAEL DYKES, D.V.M.
President and CEO, IDFA


February 27, 2019

Message from the President on Trade

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Trade developments that expand market opportunities for our members’ dairy products are a priority for IDFA. We have recently engaged in several important meetings in the Congress, the Administration and with Mexican and Canadian officials.  I want to update you on a number of trade issues that are important to our industry.

China
Late Sunday, President Trump announced that he was delaying tariff increases on Chinese imports that were scheduled to take place on March 1st.  In his tweet, the president cited “substantial progress” in ongoing talks with China on structural issues.  To that end, top trade negotiators from both countries are also drafting six agreements that will serve as an outline of actions that China must take on structural reform.  These agreements will cover forced technology transfers and cyber theft; IP protections; service industry market access; agricultural market access; currency manipulation; and non-tariff barriers.  If the sides continue to make progress on these issues, the president said that he plans to meet with Chinese president Xi to sign an agreement, possibly as early as late March.

While most trade observers viewed this weekend’s announcement positively, there is still much work to be done to address the structural problems inherent in U.S.-China trade.  So far, the most tangible sign of progress has come in the form of Chinese commitments to reduce auto tariffs and to purchase additional U.S. products, which have primarily been soybean purchases in the agricultural sector.  While such purchases will help reduce the U.S. trade deficit with China, meaningful changes to Chinese practices and improved market access for specific agriculture products are not expected to be announced as part of these negotiations.

The future of the 301 tariffs on Chinese goods remains unclear if an agreement is announced in March. They may be withdrawn with provisions to put them back on if China fails to honor their commitments or they may remain in place until the Administration determines that China has implemented the structural changes outlined in any announced agreement.

Section 232 tariffs
Pressure continues to build on the administration to lift the Section 232 steel and aluminum tariffs on Mexico and Canada.  Senior House and Senate Republicans have told the administration that Congress will not approve the U.S.-Mexico-Canada Agreement (USMCA) until the 232 tariffs are removed.  Moreover, based on recent meetings that we have had with the Administration, Mexican Minister of Agriculture and Mexican Ambassador to the US, and the Canadian Deputy Ambassador to the US, it appears that both governments may be contemplating increases to their initial retaliatory tariffs or rotating the products targeted for retaliatory tariffs if the Section 232 tariffs are not lifted soon.  Given these developments, it seems almost certain that lifting these tariffs is a prerequisite for obtaining congressional ratification of the USMCA.  We continue to believe that the only chance the administration has to pass USMCA is if congress votes on it this year, before the 2020 U.S. presidential campaign begins in earnest. 

On February 17th, the Department of Commerce also submitted a report to the president regarding the national security impact of auto and auto parts imports.  Under the Section 232 statutory timeline, the president has 90 days (mid-May) to determine remedies, which could very well include tariffs on imported autos and auto parts.  The president has previously indicated that he will use the auto tariff issue as leverage in upcoming negotiations with the European Union and Japan on separate bilateral trade agreements. Given these comments it appears unlikely that we will see any significant progress on a US-Japan FTA until the Administration clarifies its position on auto tariffs.

Finally, IDFA is supporting bipartisan legislation that was recently introduced in the House and Senate to change the current Section 232 tariff imposition process.  Under these bills, the Department of Defense would be required to justify the national security basis for new Section 232 tariffs.  The legislation would also expand congress’s role in the tariff imposition process going forward.   

Brexit
UK Prime Minister May stated over the weekend that parliament will vote on a Brexit deal on March 12th, just seventeen days before Brexit is scheduled to take place – deal or no deal.  The uncertainty around Brexit means any US-UK FTA remains uncertain until the end of March in a best-case scenario.

We will keep you updated on each of these issues.  In the meantime, please let me or Beth Hughes (bhughes@idfa.org) know if you have any questions. 

Sincerely,

signature Dykes
MICHAEL DYKES, D.V.M.
President and CEO, IDFA


December 18, 2018
 

December 12, 2018
 

October 30, 2018
 

October 18, 2018

Building the IDFA of the Future

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I’m sharing some exciting news that I believe will be the foundation for a new phase of evolution and growth for IDFA. This foundation will allow IDFA to enhance legislative, regulatory and communication efforts on your behalf and increase the return on investment that you and your company receive through membership.

In a show of overwhelming support, the IDFA boards of directors and member representatives voted this month to consolidate the governance structure of the current constituent boards – Milk Industry Foundation, National Cheese Institute and International Ice Cream Association – under one central organization, IDFA. Under this new structure, IDFA will be more nimble, inclusive and effective in representing the interests of all segments of the dairy processing industry. It will take effect Jan. 1, 2019.

The new leadership structure will have an IDFA Executive Council with 15-25 members, focused on the business and operations of the association. It also will feature five Industry Segment Boards that will drive policy and strategy - representing fluid milk, ice cream, cheese, yogurt and cultured products, and dairy-derived ingredients, with the option to add boards as the industry continues to evolve and product categories increase. IDFA will operate under one set of bylaws and financial reporting requirements, as well as one budget.

Reasons for the Change

  • Pursuing priorities as one advocacy organization will enhance the effectiveness of our voice in Washington.
  • Establishing Industry Segment Boards will promote continued member engagement and allow flexibility for new members and product categories in the future.
  • Creating a universal structure with room for growth will allow IDFA to support the changing needs of your company and the dairy foods industry overall.
  • Simplifying our current governance will allow IDFA to increase operational efficiency.

I’d like to thank each of our board members and all the member representatives who voted to support this change which will position IDFA for continued growth.

IDFA_ExecCouncil-01

How It Will Work

  • The IDFA Executive Council will conduct the official business of the association and carry out its fiduciary responsibilities.
  • The Industry Segment Boards will maintain the prioritizing and planning functions of the current constituent boards, providing strategic vision, policy direction and leadership on segment-specific issues. Each of these boards will conduct business without the administrative process required of a formal board and will coordinate with the IDFA Executive Council to establish its own operating principles.
  • Dairy processor members and Gold Business Partners will be eligible for seats on the IDFA Executive Council and Industry Segment Boards.
  • IDFA will continue to offer a variety of opportunities for member participation. Your expertise, experience and engagement remain vitally important to our efforts.

An interim Nomination and Governance Committee will lead the process for selecting the IDFA Executive Council members and the chairs and vice chairs of the Industry Segment Boards. The committee will select the new leaders for the Executive Council by the end of this year, so they be in place and prepared to lead starting Jan. 1.

We’ll have more details for you in the months ahead, especially in time for Dairy Forum, Jan. 20-23 in Orlando. I look forward to seeing you there and sharing more about our plans for future growth.

If you have questions about your membership or participation with IDFA, please contact Tom Wojno, IDFA senior vice president of innovation and member advancement, at twojno@idfa.org or 202-220-3510.

This is truly an exciting time at IDFA and I am so grateful for your membership, your engagement and your continued support of the dairy industry!

Sincerely,

signature Dykes
MICHAEL DYKES, D.V.M.
President and CEO, IDFA

 
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