The U.S. Department of Agriculture announced Tuesday that producers in all 10 federal milk marketing areas passed the department's final decision on a new definition for Class I milk. Under the rule, the term "fluid milk product" will apply to any milk product, fluid or frozen, containing 6.5 percent or more of nonfat milk solids or 2.25 percent or more of true milk protein. The implementation date is January 1, 2011.
The rule also determines how milk and milk-derived ingredients will be priced under all federal milk marketing orders when they are used in products meeting the definition. It exempts drinkable yogurt products containing at least 20 percent yogurt (by weight), kefir, infant formulas, dietary products (meal replacements) and other products that may contain milk-derived ingredients from products meeting the fluid milk product definition.
The decision resolves several proposals intended to change USDA's definition of a fluid milk product in response to new products that have been introduced to the marketplace. IDFA views the rule, which stems from a June 2005 federal order hearing, as another example of why the federal milk pricing system needs to be reformed.
"Several years ago, dairy processors began developing new, innovative dairy products in response to consumer demand. It has taken five years for the system to determine how much the government would require processors to pay for the farm milk used to make them," said Connie Tipton, IDFA president and CEO. "The entire dairy industry will benefit when decisions about product innovation and processing investments are made based on what consumers want when they want it, rather than based on how government regulations decide the costs involved."
The final rule is available here.
Members with questions about implementation may contact Bob Yonkers, IDFA vice president and chief economist, at firstname.lastname@example.org or (202) 220-3511.