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First Change
Establish the trigger point margin (difference between the all milk price and the national average feed cost) as being equal to the national average feed cost. DMSP would be activated when the margin falls below the national average feed cost.

Second Change
In order to achieve the legislative goal of preventing a catastrophic loss to dairy producers caused by the over production of milk which exceeds profitable demand, market signals recognized as strong and timely need to be sent to the producer.
Present legislative language does not accomplish this task.
A simple yet effective strategy to keep the supply of milk balanced with profitable demand could be the following:

“Any time the margin falls below the national average feed cost, the USDA would immediately notify all dairy producers that after a period of 30 days, the DMSP would be activated and remain in effect until the margin once again exceeds the national average feed cost, at which time DMSP would trigger out and deactivate the program. During a period of activation, milk producers would not be paid for milk produced in excess of their base, which is determined by their average milk marketings made during the 12 month period preceding the notification by USDA. In the event a producer does not have milk marketings 12, months prior to the notification, that producer’s base would be the average of his first three months of milk marketings.”

Under this language, producers who expand their production, during the period of an active management program, would not receive payment for their production in excess of their average milk marketings as established by production records for the 12 month period preceding notification by USDA. Therefore, those producers who contribute to a supply of milk beyond parameters established under the program, through an overproduction of their 12 month average base, would bear a cost beyond the required reduction to bring the supply of milk back in line with profitable demand.

Third Change
In order to ensure that a managed domestic milk supply is not back-filled with imported products, reasonable limitations and regulation of those imported dairy products and or ingredients used in the manufacture of a dairy product must be imposed.

Fourth Change
While it is clear that proposed Federal Milk Marketing Order Reform has minimal dairy producer support it appears it should be handled in a different forum. It has been suggested that if FMMO revisions were handled administratively, and allowed input through a hearing process, it would be of greater benefit not only to the proposed legislation, but would also serve the better interests of FMMO revision.

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