DFA participates in lawsuit, partners with Suiza Foods

Dairy Farmers of America has joined other marketing organizations, which represent dairy farm operations in Texas and New Mexico, in filing a lawsuit to stop the Oct. 1 implementation of federal order reform.

The lawsuit, which was filed in U.S. District Court in Texas, asks for a temporary restraining order and preliminary injunction. The goal of the lawsuit is to prevent the final rule's negative impact on fluid milk and dairy farmer prices.

"We continue to hope that Congress will legislate changes to the final rule that remove the most negative aspects of the decision," said DFA Board Chairman Herman Brubaker, in a DFA press release. Legislation now before Congress would substitute an option that would maintain dairy prices at levels close to where they are and have been.

Brubaker said that with the pending Oct. 1 deadline for federal order reform drawing closer, it is becoming less likely that Congress will have time to act on the needed changes. "We are urging Congress to move forward in mandating Option 1-A, reducing the cheese make-allowance and increasing Class III prices," Brubaker said.

"We also seek to extend the dairy price support program another year, and we are pushing for the continuation and expansion of the Northeast Compact, as well as authorization of a Southern Dairy Compact," he added

Noting the importance of the Option 1-A issue to Texas and New Mexico dairy producers, DFA's Southwest Area Council Chairman Calvin Buchanan said Class I milk prices to Southwestern dairy producers would be as much as $1.20 lower if the final decision is implemented without changes.

Plaintiffs joining the lawsuit include Elite Milk Producers Inc., Select Milk Producers Inc., Zia Milk Producers Inc., Lone Star Milk Producers LC, Texas-New Mexico Milk Marketing Agency Inc. and the Southwest Agency. Additional lawsuits, seeking the same relief, have been filed by dairy farmer organizations from the Southeast and Northeast.

DFA and Suiza Foods Corp. announced Sept. 21 a transaction to form a new joint venture that will encompass all the domestic fluid milk processing activities of Suiza Foods and Southern Foods. The new joint venture, which is expected to close at the end of the year, will initially be known as Suiza Dairy Fluid Group.

"This venture will further expand DFA's ability to serve customers by increasing efficiencies and allowing our dairy marketing cooperative to actively participate in the restructuring of the dairy industry," said DFA President and Chief Executive Officer Gary Hanman, in a DFA press release.