Edge comments on proposed mandatory survey

Edge Dairy Farmer Cooperative recently submitted comments to USDA regarding a proposed mandatory survey that would collect data on dairy manufacturing costs and product yields. This survey is important because the results will directly influence how milk prices are calculated under Federal Milk Marketing Orders (FMMOs), specifically through make allowances and yield formulas.

Our message is clear: the way this data is collected and reported will have real financial impacts on dairy farmers. Edge strongly supports a transparent and well-designed survey but emphasizes that the details matter.

First, we urged USDA to publish data with as much detail as possible—while still protecting confidentiality. Manufacturing costs vary widely across the industry depending on plant location, scale, and especially the age and modernization of facilities. Rather than reporting a single average, USDA should publish distributional statistics, such as percentile breakdowns and ranges, so that stakeholders can see the full picture of cost variation across the industry.

Second, and most importantly, Edge argued that the survey data should enable USDA to set make allowances based on the costs of the most efficient plants rather than industry averages. This matters directly to farmers because make allowances are deducted from commodity prices to determine the regulated minimum price paid for milk. When make allowances are inflated by the costs of outdated, under-invested, or poorly managed plants, every dairy farmer receives a lower price, even farmers shipping to efficient operations. Plants may report high costs for reasons that have nothing to do with the true cost of manufacturing: deferred capital investment, blended costs from specialty product lines, governance choices that prioritize spending elsewhere (e.g. subsidized hauling), or simple operational inefficiency. Basing make allowances on frontier-level performance sends a clear signal that processors must invest and modernize, rather than passing the costs of inefficiency on to producers through lower regulated prices.

Edge will continue advocating to ensure farmer interests are protected throughout this process.