California Dairy Task Force meets

California’s newly formed Dairy Future Task Force held its first meeting, Oct. 23-24, to address immediate and long-term challenges facing the state's dairy industry.

California Department of Food & Agriculture (CDFA) Karen Ross announced creation of the panel earlier this summer, after a panel denied a petition by producer groups to adjust the state's whey factor in Class 4b minimum milk pricing formula. The action came in the face of skyrocketing drought-related feed costs, forcing many producers into bankruptcy.

 

 The 28-member Dairy Future Task Force is made up of dairy producers, processors and cooperatives (see list).

Background information provided by CDFA said the California Milk Advisory Board (CMAB) will have administrative oversight of the task force. Meetings will not be open to the public to “eliminate public posturing, hyperbole, and positioning for political gain.”

 

According to the background information, task force members were invited as individuals – not as representatives of associations or other organizations. There will be “significant public vetting of various stages of the task force's work, which will strive to create consensus around short- and long-term solutions.”

 

“The first session, held Oct. 23-24, provided an opportunity to agree on a common fact base and develop a sense of what the group wants to accomplish in the coming months,” Ross said. “The task force achieved alignment around a shared vision for the future of the California dairy industry which is a significant accomplishment and a key step toward long-term success.  The initial session was designed to set the stage for the group to identify and build strategic pillars that will result in a robust, profitable, demand-driven dairy industry.

“Based on the discussion of concepts for potential short-term solutions, CDFA anticipates receiving a petition shortly and will evaluate it on an expedited basis,” she continued. “I very much look forward to working with the talented and passionate producers and processors who are willing to provide leadership to this very important sector of the agricultural community.”

 

Several years ago, CMAB commissioned a study which provided concepts for long-term sustainability and industry growth for the California dairy industry. That report, by global management consultant McKinsey and Company, is serving as a foundation for discussions on long-term solutions.

 

According to the CDFA backgrounder, CDFA has used the limited discretion it is given by law to provide appropriate adjustments, such as modifying the whey factor scale up to 50¢/cwt. based on commodity prices. It said fluid milk prices have been rising to meet market conditions, noting the minimum price has increased approximately 30% since June 2012 and is now among the highest prices on record. Class 4b milk, which is used to make cheese, is also up in recent months by about 30%.

 

Looking ahead, members of the industry agree the path forward must include reforms to our pricing structure as a key step towards a better future.