To stabilize market conditions, benefit producers and consumers by establishing and maintaining orderly marketing conditions, and assure consumers of adequate supplies of pure and wholesome milk at all times.

The following three sections provide an overview of the Federal Milk Marketing Orders:

1. Map of the Federal Milk Marketing Orders  
2. Benefits of the Program
3. Program Operations
   • Classified price plan
   • System of minimum prices
   • Terms of the order
   • Provisions for administering the order

Milk Marketing Order Statistics

Milk Marketing Order Reform

Key Contacts

Milk Market Administrator Web Sites:

List of Available Publications

For more information, contact Clifford Carman, Associate Deputy Administrator for Formulation and Enforcement, Dairy Programs, Agricultural Marketing Service, U.S. Department of Agriculture, Room 2971-South Building, Stop Code 0231, 1400 Independence Avenue, S.W., Washington, D.C. 20250-0231. Telephone: (202) 720-7183. FAX: (202) 690-0552. Internet: Clifford.Carman@usda.gov.

Benefits of the Program

• Assures dairy farmers a reasonable minimum price for their milk throughout the year
• Assures consumers of an adequate supply of milk to meet their needs throughout the year and help prevent wild fluctuations in price through periods of heavy and light milk production

Program Operations

Each milk marketing order includes the essentials of (1) a classified price plan, (2) a system of minimum prices, (3) terms of the order, and (4) provisions for administering the order.

(1) Classified price plan

A classified price plan provides different classes and prices for milk of different uses. Milk used in fluid products is placed in Class I, the highest priced class. Milk used to produce ice cream, yogurt, butter, cheese, nonfat dry milk, and other manufactured products is placed in Class II or other lower-priced classes.

(2) System of minimum prices

Each milk marketing order sets minimum prices for the various use-classes. Such prices are established for milk of 3.5 percent butterfat content, and adjustments are made for milk which has a butterfat test different from that specified. Some orders also adjust for the solids-not-fat or protein content of the milk. Since some markets get milk from wide geographic areas, prices also are adjusted to reflect values at different locations. The orders provide that producers be paid a uniform or average price. In most orders, this uniform price is calculated by combining and averaging class values for all handlers through marketwide pooling provisions.

(3) Terms of the order

The terms of an order are developed through public participation in hearings held by AMS prior to the issuance of the order. The public hearings offer an opportunity for all parties to bring their interests to the attention of USDA and to show the effect of any proposed marketing order or amendments. During these hearings, producers, handlers, and consumers may present information or proposals regarding the need for an order and what its provisions should include. Dairy Programs analyze hearing records, recommends the terms and provisions of milk marketing orders, and describes their intent and purpose. If two-thirds of the voting producers approve a market order, the Secretary then approves and issues the milk marketing order.

(4) Provisions for administering the order

A milk market administrator administers each order. The duties performed by the market administrator are specified in each order. Each month the market administrator computes and publishes class and uniform prices as well as other required prices and butterfat differentials. The market administrator verifies each handler's reports and payments through an audit program.

The market administrator prepares statistics and information concerning operations under the order, keeps records and books that clearly reflect the transactions provided for in the order, and disseminates this information to the public. The market administrator also receives and investigates any complaints of violations of the order. The market administrator's staff expenses are paid by an administrative fund derived from assessments on regulated handlers. Most of the orders also provide for a marketing service payment which covers the expense of providing market information and for the verification of weights, sampling, and testing of milk received from producers who are not members of qualified cooperatives that are performing such services. The cost of these services is borne by the producers.

Go To: Dairy Programs