According to IDFA, USDA is getting some pressure from a lot of dairy companies and cooperatives over their recent decision to delay milk price formula changes. The letter was signed by 25 executives.
Top officers from 25 leading dairy companies and cooperatives pressed the U.S. Department of Agriculture (USDA) to rethink immediately its recent decision to delay much needed updates to “make allowances” in a letter delivered yesterday to U.S. Secretary of Agriculture Mike Johanns. Stressing the industry’s dire need, the executives pointedly said any further delay could force some U.S. dairy product manufacturers to close their doors, and they pressed the secretary to issue new allowances on an interim basis.
Earlier this month, USDA shocked the dairy industry by announcing plans to reconvene a national public hearing to amend the Class III and Class IV milk price formulas. The International Dairy Foods Association (IDFA) estimates that the current formulas, which use manufacturing cost data from 1997-99, are causing companies in the dairy industry to lose $26 million a month. “Given the potentially complex and divisive nature of the amendments that may now be proposed, this timetable will not allow for the implementation of new make allowances until well into calendar year 2007,” the letter to Johanns states.
Make allowances establish fixed margins available to manufacturers under Federal Order classified pricing formulas to cover the costs of turning raw milk into finished dairy products. Without an update to reflect current manufacturing costs, many cheese, butter and powder plants are forced to operate at a loss, because they don’t have the margins to cover the costs necessary to run their operations.
Here’s the list of people who signed the letter:
Erick Boutry, president and chief executive officer, Sorrento Lactalis, Inc.
Terry Brockman, president and chief operating officer, Saputo Cheese USA Inc.
Mark Davis, president, Davisco Foods International, Inc.
John Dilland, general manager, Michigan Milk Producers Association
Larry Ferguson, president and chief executive officer, Schreiber Foods, Inc.
John Fridirici, vice president, milk marketing and procurement, Grande Cheese Company
David E. Fuhrmann, president and chief executive officer, Foremost Farms USA, Cooperative
Mark Furth, general manager and chief executive officer, Associated Milk Producers, Inc.
Stephen Gaddis, president, Pacific Cheese Co., Inc.
Louis P. Gentine, chairman and chief executive officer, Sargento Foods, Inc.
James B. Green, president and chief executive officer, Kemps, LLC
Brian Haugh, president and chief operating officer, National Dairy Holdings, LP
John Jeter, president and chief executive officer, Hilmar Cheese Company
Mark G. Leddy, co-chief executive officer, Valley Queen Cheese Factory, Inc.
Tim Omer, president, DCI Cheese Company, Inc.
Chris Policinski, president and chief executive officer, Land O’ Lakes
Kevin Ponticelli, executive vice president and president, cheese and dairy, Kraft Foods, N.A., Inc.
Mike Reidy, senior vice president, procurement, logistics and business development, Leprino Foods Company
Steven Rowe, vice president, legal and public affairs, Darigold, Inc.
Richard Scheuermann, president and chief executive officer, Alto Dairy Cooperative
Dr. Richard Stammer, president and chief executive officer — Cabot, Cabot/McCadam
Gary Vanic, president and chief executive officer, Great Lakes Cheese Co., Inc.
Robert Wagner, chairman of the board, Trega Foods
Douglas Wells, chief operating officer, Wells’ Dairy, Inc.
Jeffry O. Williams, president and chief executive officer, Glanbia Foods Inc.