California’s newly-formed Dairy Future Task Force held its first meeting last week. You’ll recall the task force was formed by Ag Secretary Karen Ross after a panel denied a petition by producer groups to adjust the state’s whey factor in the Class 4b minimum milk pricing formula.

The head of California’s largest dairy processor organization, the Dairy Institute of California (DIC), returned fire, defending Secretary Ross. DIC Executive Director, Rachel Kaldor, responded to what she termed were repeated attacks on California processors, especially those from the Milk Producers Council (MPC).

“Milk Producers Council has been painting a deliberately inaccurate picture of both the dairy industry and dairy policy despite pleas to provide truthful arguments to back up its often repeated, seldom fact-based claims,” she said. 

“The MPC pattern of bullying and berating processors, the Department of Food and Agriculture and the secretary is decades long. But for the past months, that bullying and berating is aimed at getting the secretary to do something that will cause real damage for years to come, to California dairy farmers and processors.”

Kaldor said MPC’s push to bring California’s Class 4b milk price in line with the federal order Class III price “failed to recognize milk production, processing and marketing conditions unique to California.”
 

She charged MPC with creating “an illusory price difference between the federal Class III (which plants are not obligated to pay) and California Class 4b, (which plants must pay) and tell California dairy farmers that they are being cheated, by a ‘discount’ milk price.” 

“MPC always fails to add the facts that: 1) despite the current short-term production pull-back, California is deficit in plant capacity with a long history of milk supplies pushing the limits of what the state’s plants can process; 2) California is the most distant from domestic commercial cheese markets and therefore has the highest cost of getting product to market; and 3) the Class 4b price must be a market-clearing price, because there is no ‘de-pooling’ safety valve to allow milk to be price based upon demand and competition like there is under the federal milk pricing system,” Kaldor said. 

Something tells me we haven’t heard the end of this.

In dairy politics, Western United Dairymen (WUD) board of directors have voted to advance a bill that would more closely align the whey value in the California 4b minimum milk pricing formula with the federally regulated minimum price for whey in surrounding states, bypassing action not taken by the California Department of Food & Agriculture (CDFA).

Dairy Profit Weekly reports that the effort is the latest stemming from a July recommendation by a CDFA panel, denying changes in the 4b formula. In issuing its ruling, the panel stated the “current Class 4b pricing formula maintains a sound economic relationship between the state’s milk production and marketing conditions for manufactured dairy products.” 

CDFA subsequently denied another petition, filed Aug. 6, by WUD, seeking an emergency hearing on the Class 4b formula, as well as a six-month, 50 cent per cwt. increase in the minimum price for all classes of milk.

“Too many of our dairy families have fallen victim to a milk pricing formula that has failed to capture adequate revenues for producers in the face of extraordinary feed costs,” said WUD President Tom Barcellos. 

“We have repeatedly petitioned the CDFA for relief to little avail. California dairy families are very concerned about their future and have been voicing those concerns. We’re all agreed on the need for action as soon as possible. The WUD board of directors is committed to finding a solution that works for all of the industry. We find that our avenues to a better cheese price are blocked leading us to a single lane. That single lane leads us to the California legislature.” 

On a lighter note; as part of its efforts to revitalize one of the most-recognized product symbols in the food industry, National Milk announced this week that the REAL seal is undergoing a makeover including a revamped website at www.realseal.com The new website will contain more content to educate consumers on why they should look for the REAL seal on the foods they buy.

NMPF’s Jerry Kozak stated that “Imitation products made from vegetables and nuts, but packaged like real dairy products and often using dairy names, have proliferated in the last few years. For example, frozen desserts made out of soybeans are packaged the same as real ice cream made from cows’ milk, with pictures that make it look like real ice cream. The only way a consumer would know the product isn’t ice cream is by reading the ingredients label. The same is true for other processed foods made with imitation dairy products.” 

“Currently, frozen pizza is essentially the only processed food that uses the Real seal,” Kozak said, but one of the goals is to expand that to include terms like “Made With” real dairy, and “American Made,” along with specific dairy product names and have a fully-integrated program up and  running early in 2013.

Readers with questions or comments for Lee Mielke may write to him in care of this publication.