The milk quality premium has long been the standard in the U.S. dairy system. Producers are rewarded for producing milk with lower somatic cell counts with dollars that are over and above the flat price per hundredweight (cwt). This system has been around for a long time for good reason: It works.

However, as the dairy market hurtles toward globalization, the definition of quality milk is changing. To meet current European Union (EU) standards, a somatic cell count (SCC) of 400,000 cells per ml is already expected by processors who export their product overseas.

In addition, certification programs like SQF-1000 and the Global Food Safety Initiative become more accepted and adhered to in order to compete with stricter standards overseas.

Lower SCC limits are being put in place by processors and by regulators, and the system of premiums for quality milk is in danger of being replaced by an expectation of quality milk. In some instances, milk that doesn’t measure up is being discounted or even refused.

If these changes become more commonplace, the question now on everyone’s mind will be: “Will a shift from premiums to penalties have a negative impact on overall domestic milk quality?”

Simply put: No. I don’t think this trend will have negative impact. American dairymen have already proven that they can produce the best quality milk on the planet, no matter the incentive.

The carrot, the stick or our own best interest?
The bright, shiny secret in the U.S. dairy industry is that the majority of U.S. dairies already produce milk that’s of a higher quality than the standard demanded by the EU, and many dairies regularly achieve a threshold below 300,000 cells per ml.

A 2008 survey by the U.S. Animal and Plant Health Inspection Service found that the average SCC count on American dairies was 245,000 per ml. So maybe the question in our industry shouldn’t be: “How will a lack of incentive programs affect producers’ milk quality?” Maybe we should be asking ourselves, “Why don’t we shoot for less than 300,000 per ml as a rule?”

It’s been proven that producers make a better product when incentives and premiums are at stake. According to a 2008 study published by the American Dairy Association , a higher premium offered to a producer regularly results in milk with less than 200,000 per ml.

If 200,000 is already proven to be an achievable goal, it seems that it would behoove all producers to simply aim for that number, as opposed to waiting to be enticed to produce that number. Whether there are premiums involved or not, a better product will affect the long-run bottom line of a dairy producer more than anything else.

How good can it get?
The big question then becomes: “What number is reasonably attainable?” As the annual National Dairy Quality Awards prove, regular counts of less than 100,000 per ml are not uncommon, and less than 50,000 is a real possibility.

With hard evidence that the “best” producers in the country regularly hit numbers smaller than six figures, the de facto industry standard of 400,000 per ml seems unreasonably high and easily attainable, especially with the plethora of cleaning, sanitation and animal health products readily available.

Routinely achieving better SCC levels as an industry will benefit us all, no matter the impetus behind the ultimate goal.

It is estimated that high SCC levels cost the industry more than $2 billion every year, and a study by Quality Milk Production Services proved that decreasing SCC from 400,000 per ml to 300,000 per ml can increase milk production by more than 1.2 pounds per cow per day.

In the long run, this extra production more than makes up for any up-front costs for sanitation equipment or lack of incentives. And if the U.S. dairy industry becomes known for strict SCC levels and better milk quality as a result, the increased export demand will trump everything else – because selling more milk is everyone’s goal.

Though the federal SCC limit remains at 750,000 per ml, those days are coming to an end. In 2011, the National Committee on Interstate Milk Shipments narrowly voted down a proposal to lower the national limit to 400,000 per ml.

Idaho and Oregon dropped their legal limits to 400,000 and 500,000 per ml, respectively, in 2012, and Washington has a proposal on the table to drop the state’s standard to 400,000 per ml. Major U.S. buyers like Kroger are setting their own limits (250,000 per ml) that already best the EU standard.

Given my position, you’d expect that I would be in favor of reducing SCC counts at all costs, across the board. But I don’t advocate for lower counts because it’s in my company’s best interest.

I advocate for lower counts because I see what is possible and understand the longer-term advantages for our producers and our industry in taking and maintaining a global leadership position. There is no reason American dairy producers can’t be the global leaders when it comes to milk quality.

It should be our vision, as an industry, for U.S. dairy producers to achieve and sustain the position as the global leader in quality milk production, both for producers’ long-term success and our success as an industry.

The high-quality carrot may be disappearing in the dairy industry, but it’s in all of our best interests to get ahead of the stick and just produce the best milk we possibly can. PD

Beers is the president and CEO of A&L Laboratories Inc.

Roger Beers
President & CEO
A&L Laboratories Inc.