By LEE MIELKE
Mielke Market Weekly 

The National Milk Producers Federation stated in a news release last week that, due to objections they raised, the U.S. Environmental Protection Agency (EPA) has withdrawn a regulatory guidance issued last year concerning when farmers must seek Clean Water Act permits for a long list of normal farming activities near wetlands.

On Jan. 29, the EPA and the U.S. Department of Army signed a memorandum withdrawing the "Interpretive Rule Regarding the Applicability of Clean Water Act Section 404(f)(1)(A)." Last summer, NMPF requested that the Interpretive Rule be withdrawn because it could have actually discouraged water conservation and environmental best practices.

"Our concern with the initial proposal from last year is that it could have altered the long-standing and productive relationship between farmers and the USDA’s Natural Resources Conservation Service in a way that would have made it harder for farmers to implement water conservation measures," said Jamie Jonker, NMPF’s vice president for Sustainability & Scientific Affairs. "We’re pleased the EPA and Army have recognized that this regulation could have backfired and that they’ve taken the necessary step to withdraw it."

The EPA guidance, officially called an Interpretive Rule, was issued in March 2014. It said farmers are only exempt from needing Clean Water Act permits for more than 50 routine farming practices if they comply with detailed NRCS technical conservation standards. Historically, these standards have been voluntary, and the farming practices exempt from the permit process.

In comments filed last July, NMPF said the guidance changes NRCS’s role from that of a conservation partner to that of an enforcer of the Clean Water Act, on EPA’s behalf. Had the interpretive rule not been withdrawn, "the NRCS would have been thrust into the role of enforcer, rather than remaining a source from which farmers could seek conservation advice. This could have hindered rather than helped conservation efforts," he said.

Jonker said NMPF has drawn up a detailed environmental handbook based on NRCS standards but tailored specifically to dairy farmers. Those who followed the guidelines in the book apparently would not have qualified for a permit exemption, "challenging the very notion of why the handbook was created in the first place," Jonker added.

Established initially in the 1930s, the NRCS provides voluntary help to farmers who want to conserve the resources on their farms. The now-withdrawn Interpretive Rule was intended to be part of the larger Waters of the U.S. proposal issued last year by the EPA. The larger proposal is still under review by both EPA and the Army Corps of Engineers and is also being scrutinized by Congress.

It’s official: A proposal has been submitted to the USDA’s Agricultural Market Service to form a Federal order in the state of California. Filed by the law office of Marvin Beshore on behalf of the members of California Dairies, Dairy Farmers of America and Land O’Lakes, it requests the USDA Secretary to call a hearing and begin the process.

After conducting an internal analysis of the proposal, USDA will decide whether a hearing will be held. USDA is requesting additional proposals regarding a potential Federal milk order for California. The request may be viewed here.

Request for Additional Proposals (PDF) Proposals must be received by April 10.

USDA will conduct a series of public outreach meetings throughout California in early May 2015. Information regarding these meetings will be released soon.

The first Federal order benchmark milk price of 2015 starts on a down note. The USDA announced the Class III price at $16.18 per cwt., down $1.64 from December 2014, $4.97 below January 2014, but $2.43 above the comparable California 4b cheese milk price. It equates to about $1.39 per gallon and the lowest Class III price since June 2012.

Class III futures tell us this is not the bottom. The February contract was trading late Friday morning (Feb. 6) at $15.84, March at $15.98, and April at $15.83, with a peak of $17.20 in October.

The January Class IV price is $13.23, down $3.47 from December and a whopping $9.06 below a year ago. It is the lowest Class IV price since March 2010, although it fell to $13.24 in June 2012.

The four-week NDPSR-surveyed cheese price averaged $1.5807 per pound, down 15.6 cents from December. Butter averaged $1.5633 per pound, down 34.2 cents. Nonfat dry milk, at $1.0202, was down 23.5 cents, and dry whey averaged 58.75 cents per pound, virtually unchanged.

California’s January 2015 Class 4b cheese milk price is $13.75 per cwt., down $1.03 from December 2014, $6.56 below January 2014, and the lowest 4b price since May 2012. The January 4a butter-powder milk price is $13.09, down $3.48 from December, $9.04 below a year ago, and the lowest since March 2010.