It has been nearly a generation since dairy farmers last formally petitioned the USDA Secretary of Agriculture to establish a Federal Milk Marketing Order (FMMO). That fact alone makes the California petition noteworthy. Then, considering that the Golden State produces 20 percent of the nation's milk, all eyes will be riveted on the events that could unfold over the next two years.
The potential path to a new federal order will follow a 10-step process ladened with stringent federal regulations that will mirror a court proceeding. Not only would an administrative law judge preside over the public hearing, a stenographer will document all of the testimony. That includes publishing complete transcripts and all exhibits for public scrutiny. To get a layman's understanding of federal order creation detailed in Title 7 Code of Regulations Part 900, read page 403.
To say the least, this process will be very different than any the California industry has been accustomed to when dealing with the California Department of Food and Agriculture (CDFA) regarding its state order. The federal process is extremely transparent and structured.
Interested parties got a small glimpse into the plot lines last month when USDA facilitated outreach meetings on two full FMMO proposals and two partial proposals. As we suspected from our first-person vantage point, those meetings had the highest level of an "us versus them" battle seen since California enacted statewide pooling in 1969. We also reconfirmed that most dairy producers attending those May meetings are "mad as heck" and aren't going to take CDFA-computed farm milk prices anymore. They are consistently lower than those in federal orders.
While establishing a federal order in California would most likely raise, or at least reshuffle, producer pay prices within the Golden State, there could be ramifications far beyond its borders. That would be a reason economists and lawyers from across the country would converge on the West Coast to testify how this new order could impact other dairy producers.
Ultimately, will California join the federal order system?
We likely won't know the answer to that question until 2017, at the earliest. However, if California dairy producers have the intestinal fortitude to persevere, a federal order could be established because all votes are in their hands on the final question.