California milk cap.
July 23, 2019

California Groups To Take Systematic Look At Dairy Quota

 |  By: Jim Dickrell

Five California dairy groups have announced they are undertaking a systematic review of California’s dairy quota program to develop a path forward.

California Dairies, Inc., Dairy Farmers of America, Land O’Lakes, STOP QIP and the United Dairy Families of California are organizing a multi-phase process to study and potentially resolve the issue.

Prior to the establishment of the Federal Milk Marketing Order in California last year, the California Department of Food Agriculture (CDFA) administered the dairy quota program, deducting money from all milk checks and re-distributing it to quota holders. But the amount of the deduction was never reported on the milk check.

With the establishment of the Federal Order, CDFA continued to administer the quota program. But the amount of the deduction is now reported each month. At 38₵/cwt, that deduction can amount to thousands of dollars each month for large dairies. As such, it has brought the issue to a head. Earlier this spring, STOP QIP spearheaded an effort calling for a producer referendum on quota. That effort failed when CDFA ruled STOP QIP did not obtain enough dairy farmer signatures to trigger a referendum.

The new effort brings all major parties together to look at the issue in a systematic way. It includes three key parts:  

  1. Think Tank phase. It will gather information from various industry segments, including four producer meetings where farmers can contribute ideas and concepts.
  2. The Producer Feedback phase. Here, producers will be able to comment and challenge ideas developed in the Think Tank Phase.
  3. The Analysis Phase. Dominant ideas coming through the first two phases will then be analyzed for economic impacts and legal pathways to implement adoption will be figured out.

Marin Bozic, a University of Minnesota dairy economist, and Matt Gould, a dairy market analyst with the Dairy & Food Market Analyst, have been hired to do the economic analysis.

Think Tank meetings are scheduled next week in Ontario, Tulare, Turlock and Petaluma.

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