In this column, Progressive Dairy summarizes issues in the news and attempts to describe how they might affect dairy farmers.
Items in this column are compiled from Progressive Dairy staff news sources. Send news items to Progressive Dairy Editor Dave Natzke.
Dairy ‘climate-smart’ funding
What happened?
The USDA announced $2.8 billion in funding for 70 selected projects – including several dairy-related projects – under the first pool of the Partnerships for Climate-Smart Commodities funding program.
Spanning up to five years, the initial projects will provide technical and financial assistance to producers to implement climate-smart production practices on a voluntary basis; establish pilot innovative and cost-effective methods for quantifying, monitoring, reporting and verifying greenhouse gas (GHG) benefits; and develop markets and promote climate-smart commodities. Projects approved under the first funding pool range from $5 million to $100 million, with funding delivered through the Commodity Credit Corporation.
What’s ahead?
Earlier this year, U.S. Ag Secretary Tom Vilsack announced that the USDA had allocated $1 billion for the program, divided into two funding pools. Due to strong demand, total funding was increased to $3 billion.
The USDA is currently evaluating project proposals for the second funding pool, which includes requests from $250,000 to $4.99 million. Projects will emphasize the enrollment of small or underserved producers and institutions and will be announced later this year.
Bottom line
While numerous projects include dairy producers and commodities, those with the largest funding and direct dairy application (with funding ceiling) include:
- A 28-state project led by Truterra LLC, a subsidiary of Land O’Lakes, to catalyze a market-based network to broaden farmer access to climate-smart practices ($90 million)
- A California project, led by the California Dairy Research Foundation, to build climate-smart dairy markets and provide financial incentives for dairy producers to adopt manure management practices to reduce methane emissions ($85 million)
- A project led by Edge Dairy Farmer Cooperative, to expand markets for dairy commodities produced through climate-smart practices, improve business practices and making use of data to inform future standards ($50 million)
- A project led by Dairy Farmers of America (DFA), to use a cooperative model to connect on-farm GHG reductions with low-carbon dairy market opportunities. Other major partners in the project include Dairy One Cooperative, MyFarm LLC, Dairy Nutrition Management and Consulting LLC, Nestlé, Mars, Unilever, Barry Callebaut, Dairy Management Inc., U.S. Dairy Export Council, National Milk Producers Federation, Global Dairy Platform, Innovation Center for U.S. Dairy, CoBank and AGPROfessionals ($45 million)
- A project led by Cooperative Regions of Organic Producer Pools (CROPP)/Organic Valley, to expand climate-smart markets and help finance partnerships and incentivize farmers to advance the Organic Valley Carbon Insetting Program ($25 million)
- A project led by Penn State University and partnered with the Center for Dairy Excellence, the Professional Dairy Managers of Pennsylvania and others, to expand climate-smart markets and work with dairy producers in Pennsylvania ($25 million)
- A project led by The Conservation Innovation Fund and partnered with the Maryland & Virginia Milk Producers Cooperative Association, South Mountain Creamery and others, to expand climate-smart markets and address plans and practices for hundreds of dairy producers in the Mid-Atlantic region ($25 million)
- A project led by Maple Hill Creamery LLC, to expand climate-smart markets for dairy producers and enable a network of partners and producers to implement practices by incentivizing implementation and providing training support in New York ($20 million)
For a complete list, visit the Partnerships for Climate-Smart Commodities Project Summaries website.
August FMMO prices, pooling
What happened?
Administrators of the 11 Federal Milk Marketing Orders (FMMOs) reported August 2022 uniform milk prices, producer price differentials (PPDs) and milk pooling data. In a repeat from the previous month, uniform or blend prices moved lower, while the wide spread between Class III-IV milk prices continued to affect pooling.
What’s ahead?
September uniform prices and pooling totals will be announced around Oct. 11-14. The outlook for September milk prices is lower. September Class III and IV milk prices will be announced on Oct. 5. Chicago Mercantile Exchange (CME) futures prices have been gyrating. Based on futures prices as of Sept. 13, the September spread in Class III-IV milk prices will climb to $4.83 per cwt, further incentivizing Class IV depooling. The spread in fourth-quarter Class III-IV milk futures prices closes somewhat after that, to $3.20 in October, $2.37 in November and $1.82 in December 2021.
The National Milk Producers Federation and other organizations continue to work on consensus for FMMO reform.
Bottom line
After setting record highs in most FMMOs in June, August 2022 uniform milk prices followed the downward trend started in July. Largest declines were again in FMMOs utilizing multiple component pricing, where a lower value for protein pressured Class III milk prices lower. Five FMMOs saw uniform prices decline more than $1 per hundredweight (cwt) from the month before, led by the Upper Midwest 30 and California 51.
The Class I mover “average of plus 74 cents” formula reduced Class I prices paid to producers compared to the previous “higher of” formula by about $1.04 per cwt. Affecting Class III-IV milk prices, the value of butterfat rose in August thanks to strong butter prices, but the value of protein declined.
For a more detailed analysis, read FMMO uniform prices, Class IV pooling remain on downward trend
PFAS ‘superfund’ proposal
What happened?
The EPA is proposing to designate two of the most widely used per- and polyfluoroalkyl substances (PFAS) as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as “Superfund.”
The EPA published the proposed rule in the Federal Register, available here.
What’s ahead?
Public comments on the proposal are being accepted until Nov. 7 at docket EPA-HQ-OLEM-2019-0341 online.
According to the press release, the EPA will also do further outreach to hear from impacted communities, wastewater utilities, businesses and farmers during consideration of the proposed rule.
Bottom line
The proposal applies to perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS). If finalized, the rule would require reporting of PFOA and PFOS releases, providing EPA data and the option to require cleanups and recover cleanup costs.
Two primary ways PFAS have affected agriculture include the use of firefighting foams close to farms and land application of biosolids.
A dairy farm in New Mexico is downgradient from a military base that used the firefighting foam, impacting the groundwater used by the dairy farm for irrigation and water supply. The farmer lost more than 1,000 dairy cows, had to dump 72 million pounds of milk, and the farm can no longer be used for dairying.
Farms in Maine and Michigan land-applied biosolids from the local publicly owned treatment works as a beneficial reuse providing soil amendments.
For previous Progressive Dairy coverage of the PFAS issue as it relates to dairy farms, read:
