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Truce in California’s milk price war
July 17, 2013

Call it a truce or a compromise, but a new proposal between California’s dairy farmers and cheese-makers could help farmers through an economic crunch that has lingered for nearly five years.

According to The Modest Bee, the proposal has been written into state legislation. It calls for increases in the minimum price of milk used to manufacture cheese and in the cap on the value of whey in the state’s minimum pricing formula for Class 4b.

“We are extremely pleased with the hard work that all have put in to help our family dairies,” said Gary Conover, government relations director for Western United Dairymen in Modesto, in a news release. “Although we have already lost hundreds of dairy farms in California, there is a light at the end of the tunnel for those that are still fighting to stay in business.”

Last year, economic difficulties forced more than 100 California dairies out of the business.

In the compromise, cheese-makers will pay an extra 46 cents per hundredweight. However, it is a far cry from what Western United Dairymen and its aliens originally sought. Processors point that while they are willing to help out dairy farmers, they aren’t willing to put themselves at a disadvantage with other dairy states.

“There needs to be a balance between producer prices and what the market can bear in terms of the product we manufacture and the market for those products,” said Rachel Kaldor, executive director of the Dairy Institute of California, a Sacramento-based processor group. “In order for us to be able to stay in business, we need to be able to buy milk at a price that allows us to do that.”

In June, the California Department of Food and Agriculture granted a temporary six-month price adjustment for all classes of milk, though even Secretary Karen Ross admitted that the current, “antiquated” system is unsustainable. Click here for more.

Source: Dairy Herd Network



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