This week marks the end of an era, as California’s state milk pricing order will reach its final sunset. And with it, the Golden State will join the Federal Milk Marketing Order (FMMO) system.

Most California dairy farmers will likely say, “Good riddance,” due to perceived inaction by the Secretary of the California Department of Food and Agriculture from 2009 to 2016 when it came to updating milk pricing formulas. It’s been estimated that California dairymen and dairywomen have collectively left an estimated $290 million on the table each of the aforementioned years under the state’s retiring milk pricing calculations.

However, as the pricing operations within the California Department of Food and Agriculture closes, there will be a significant loss of collective dairy knowledge in the form of human intellect. That means that incoming federal order administrator Cary Hunter has a tall task in getting November milk checks readied for California dairy farmers. When fully enacted, this federal order will become the 11th active order in the U.S.

As for additional value to California dairy farmers . . . economic analysis indicated there could be a 45-cent per hundredweight improvement in milk prices over the next decade.

Processors look to streamline
The International Dairy Foods Association (IDFA) has a new look as well. Most dairy farmers do not interact with IDFA on a regular basis. However, it’s the world’s largest dairy processor trade association.

IDFA got its start in 1990 when the Milk Industry Foundation (MIF), National Cheese Institute (NCI), and the International Ice Cream Association (IICA) came together to form IDFA. From 1990 to 2018, each organization operated independently under the IDFA umbrella.

“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,” said IDFA’s President and CEO Michael Dykes. The move will take effect on January 1, 2019.

“The new leadership structure will have an IDFA Executive Council with 15 to 25 members, focused on the business and operations of the association,” noted Dykes. “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,” added the one-time practicing dairy veterinarian.

Reasons for change
Dykes highlighted the following reasons for these changes:

  • 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.

How it will work
“The IDFA Executive Council will conduct the official business of the association and carry out its fiduciary responsibilities,” said Dykes.

“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,” he added. “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,” said Dykes.

“Dairy processor members and Gold Business Partners will be eligible for seats on the IDFA Executive Council and Industry Segment Boards,” he went on to say.

“IDFA will continue to offer a variety of opportunities for member participation. Your expertise, experience, and engagement remain vitally important to our efforts,” Dykes concluded.

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(c) Hoard's Dairyman Intel 2018
October 29, 2018
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