|WUD makes the case for whey value adjustments|
Testifying before a standing-room-only crowd at the CDFA Thursday, May 31, 2012, Western United Dairymen presented a strong case for making adjustments to California’s pricing structure that would result in a Class 4b whey value that more closely tracks the market direction of the Class III whey value and bringing California and national pricing into the reasonable and sound relationship required under the code. CEO Michael Marsh in his testimony proposed modifying the current sliding scale in the Class 4b formula to allow the whey factor to more closely reflect the whey value generated by the current Class III formula. To download WUD's trestimony, please click here.
Several dairy producers, including WUD President Tom Barcellos, made personal appeals to the CDFA hearing panel to accept the proposed changes. Producers cited the tremendous economic burdens that have impacted California dairy families over the last several years, noting that costs of production on the dairy have increased significantly.
Said Marsh, “Due to all those increased costs, California dairymen have lost much of their competitive position relative to the rest of the nation. Failing to capture the value of whey, which has turned out to be a very marketable product, is hurting their competitiveness further.”
Marsh pointed out that producers are increasingly using risk management tools to protect their operations, noting, “Even processors recognize the importance of those tools and want producers to be able to use them effectively. Adjusting the whey factor to allow fluctuation with market prices will better enable California dairymen to utilize these risk management tools.”