The United States Department of Agriculture (USDA) has made available a courtesy copy of the recommended decision concerning proposed amendments to the Federal Milk Marketing Orders (FMMOs). The official version of this decision will be published in the Federal Register at www.ams.usda.gov/rules-regulations/milk-northeast-and-other-marketing-areas-proposed-amendments-marketing-agreements.

During this period, the USDA remains under ex parte communication restrictions until the final decision is published. As a result, the FMMO Hearing Team cannot respond to substantive questions. For inquiries related to the process, stakeholders are advised to email FMMOHearing@usda.gov.

The document in question, identified by Docket Number AMS-DA-23-0031, is not yet the official version of the proposed rule concerning amendments to the marketing agreements and orders for milk in the Northeast and other marketing areas. The official publication in the Federal Register will provide the definitive version and details for submitting comments.

Key Proposed Amendments:

This recommended decision proposes amendments to five categories of milk pricing:

1. Milk Composition Factors:
   • Update factors to 3.3 percent true protein, 6 percent other solids, and 9.3 percent nonfat solids.
2. Surveyed Commodity Products:
   • Remove 500-pound barrel cheddar cheese prices from the Dairy Products Mandatory Reporting Program (DPMRP) survey.
   • Rely solely on the 40-pound block cheddar cheese price to determine the monthly average cheese price used in the formulas.
3. Class III and Class IV Formula Factors:
   • Update manufacturing allowances to:
     • Cheese: $0.2504
     • Butter: $0.2257
     • Nonfat Dry Milk (NFDM): $0.2268
     • Dry Whey: $0.2653
   • Update the butterfat recovery factor to 91 percent.
4. Base Class I Skim Milk Price:
   • Update the formula so that the base Class I skim milk price would be the higher-of the advanced Class III or Class IV skim milk prices for the month.
   • Adopt a Class I extended shelf life (ESL) adjustment, equating to a Class I price for all ESL products equal to the average mover, plus a 24-month rolling average adjuster with a 12-month lag.
5. Class I and Class II Differentials:
   • Maintain the $1.60 base differential.
   • Adopt modified location-specific Class I differential values.

Economic Impact Analysis

AMS conducted a Regulatory Economic Impact Analysis to assess the potential impact of the proposed amendments on producer revenue and marketwide pool values. The analysis incorporated actual data reported from January 2019 to December 2023. The full text of the Regulatory Economic Impact Analysis can be accessed here.

For further information, contact Erin Taylor, USDA/AMS/Dairy Programs, Order Formulation and Enforcement Branch, at Erin.Taylor@usda.gov or (202) 720-7183.