FOOD TECHNOLOGY

Detailed explanation-1: -The 1996 Farm Bill required the USDA to consolidate the number of federal milk marketing orders and to revise the method by which minimum class prices are determined. The USDA implemented these changes in 2000. There are now 10 milk marketing orders, down from 31 when the law was enacted.

Detailed explanation-2: -The U.S. Department of Agriculture (USDA) oversees the Federal Milk Marketing Order (FMMO) program which includes 11 milk marketing orders and applies to about 75 percent of total U.S. milk production.

Detailed explanation-3: -Federal Milk Marketing Orders (FMMOs) establish certain provisions under which dairy processors purchase fresh milk from dairy farmers supplying a marketing area. In Federal order provisions, dairy processors are referred to as handlers and dairy farmers are known as producers.

Detailed explanation-4: -Handlers pay milk producers based on the pounds of milk marketed. The current system of pricing, with several additional adjustments, was implemented in January 2000 following the 1996 farm bill FMMO reform.

Detailed explanation-5: -Since the 1930s, the price of milk has been set by the federal government and tied in part to the value of a 40-pound block of Cheddar cheese sold on the Chicago Mercantile Exchange. So the price that cheese trades at in Chicago is a major factor that determines what a dairy farmer earns.