OFU asks for milk pricing hearing

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COLUMBUS – The Ohio Farmers Union is requesting the USDA hold a hearing in Federal Milk Marketing Order 33 to review dairy pooling rules.
The Farmers Union follows the Ohio Dairy Producers, which also submitted a formal hearing request.
Work the system. “Current USDA rules allow dairy processors to ‘game the system’ by moving their milk into our pool from distant markets or moving local milk to distant markets, often at the local dairy farmers’ expense,” said Ohio Farmers Union president Joe Logan.
“When prices go up, we think our local dairy farmers deserve a chance to capture their fair share of those market returns.”
Logan cited figures from OSU ag economist Cameron Thraen, who estimates the loophole in the milk marketing order may have cost area dairy farmers $28.4 million during the past two years.
Surrounding milk markets are already engaged in the process to change their rules to eliminate this loophole.
Complex. Milk prices for local dairy farmers are established by the USDA according to a complex formula, which is affected by the amount of milk delivered into the Mideast Milk Marketing Order.
Depooling occurs when milk handlers pull milk out of the milk marketing order for pricing purposes, typically to capture a price advantage.
“f no action is taken, the Mideast Milk Marketing pool may become a dumping ground for distant milk, further depressing prices to local farmers,” Logan added.

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