Committee hears dairy-policy history and young farmers’ warnings as pricing rules shift

The Vermont Senate Agriculture Committee on Feb. 5 heard an extended briefing on national dairy-pricing policy from dairy-policy adviser Bob Gray and farmer–board member Bill Rowell, followed by testimony from six Vermont dairy producers who urged the committee to protect farm viability by avoiding hasty rule changes and by addressing state regulation, manure‑management windows, broadband access and capital needs.

Gray, a long-time dairy policy adviser who said he worked on the Hill and with multiple Vermont senators, traced the legal framework that underpins U.S. milk markets and argued the federal system matters to Vermont farms. "The Capper‑Volstead Act allowed farmers to form cooperatives," Gray said, explaining how cooperatives give farmers bargaining power and ownership in processing. He described the federal milk marketing order (FMMO) structure — four utilization classes used to pool milk and set prices for fluid milk, soft products, hard cheese and butter/powder — and said the mix of those classes determines what farmers receive.

The recent federal hearing and pending order change led the discussion: Rowell and Gray told the committee that a pricing formula adjusted in 2018 — which used the average of Class 3 (cheese) and Class 4 (butter/powder) plus a 74¢ differential to set the Class 1 (fluid milk) mover — reduced farmer receipts. "That formula cost farmers about $1.6 billion in the Northeast," Rowell said.…