Episode notes
The USDA’s June 1, 2025 Federal Milk Marketing Order (FMMO) reforms will radically reshape dairy economics, reversing a flawed 2018 policy that cost farmers $725 million during the pandemic. While restoring the “higher-of” formula benefits some, controversial processor-friendly make allowances could strip $56,000 annually from 100-cow operations. Regional disparities will create clear winners (Northeast) and losers (Midwest, California), with urgent adaptation required as competitors already pivot strategies. The clock is ticking—81 days remain to restructure contracts, risk management, and production plans.
Key Points
1. The “Higher-of” Formula Restoration
• Reverses the 2018 Farm Bill’s flawed “average + $0.74” formula that transferred $725M from farmers to processors during COVID-19.
• Class I milk pricing returns to ...
Keywords
FMMO reforms 2025dairy pricing changesmilk make allowances