State Milk Commission (Board) Convened at 2:00 P.M

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State Milk Commission (Board) Convened at 2:00 P.M DRAFT MINUTES Milk Commission Meeting Held February 18, 2021 The meeting of the State Milk Commission (Board) convened at 2:00 p.m. on Thursday, February 18, 2021. The meeting was held by electronic communications means due to the state of emergency issued by Governor Northam as a result of the novel coronavirus (COVID-19). The meeting was held using Cisco Webex Events. Mr. Kerr called the meeting to order. PRESENT: Jimmy Kerr, Chairperson, Producer Representative Carolyn Carlson, Consumer Representative Kevin Craun, Producer Representative Jessica Jones, Consumer Representative Brian Linney, Processor Distributor Representative Bruce Mayer, Consumer Representative ABSENT: Rodrigo Velasquez, Consumer Representative STAFF PRESENT: Crafton Wilkes, Administrator Monique Hutton, Auditor Mr. Kerr asked for a motion to accept the minutes from the previous meeting. Mr. Craun requested that a correction to an incorrect date be made and moved to accept the minutes with the correction. Mr. Mayer seconded the motion. The minutes were approved by a unanimous roll call vote. APPROVE: Carlson, Craun, Jones, Kerr, Linney, Mayer OPPOSE: None Mr. Wilkes stated that he intended to keep the meeting brief in order to complete all necessary business on the agenda and avoid any potential issues related to weather interference with internet access. He reviewed retail milk sales, which increased over 2019 by 2.94%. One distributor applied for a Milk Commission license and Mr. Wilkes reviewed findings from the preliminary hearing. Mr. Linney motioned to approve all applicants as licensed distributors, and Mr. Craun seconded the motion. The license was approved by a unanimous roll call vote. APPROVE: Carlson, Craun, Jones, Kerr, Linney, Mayer OPPOSE: None License License Company Distributor Market Action Number Type Representative 359.000.3 NPGD Rainforest Distribution Corp Alexander Ridings All Approve Mr. Wilkes provided two possible scenarios for producer milk base changes. The first was to leave nine-month aggregate milk base at its current state with no percentage increase, but to forgive any milk base that had been placed into escrow previously or was to be placed into escrow in 2021. The net result would be an aggregate milk base increase of approximately 0.55%. This was his recommendation to the board because of his concern that milk sales in 2020 were an abnormality and increasing aggregate milk base in 2021 would mean a more drastic reduction for the subsequent year. The second scenario provided was to adjust milk base by the bare minimum allowable under § 2 VAC 15‐20‐40. This would result in a nine-month aggregate milk base increase of approximately 1.2% to 1.6%. Three-month milk base is determined by formula, and would increase from 90% to 94% of nine-month milk base. Mr. Craun requested an explanation of base placed in escrow. Mr. Wilkes stated that any shortage in milk production compared to allocated milk base to a farm State Milk Commission Draft Minutes: February 18, 2021 Page 2 of 30 is set aside for a one year period, and farms can regain that volume if production returns to a level at least equal to its original allocated milk base. Mr. Linney asked about the impact of increasing milk base. Mr. Michael Myatt, representing Cooperative Milk Producers Association, stated that he favored leaving milk base as-is but forgiving any base in escrow. If milk sales increased consistently in the future he would support an increase in aggregate milk base. Mr. Kerr asked for a motion regarding changes in aggregate milk base. Mr. Craun motioned to leave base at its current level, and Mr. Mayer seconded the motion. The motion was approved by unanimous roll call vote. APPROVE: Carlson, Craun, Jones, Kerr, Linney, Mayer OPPOSE: None Mr. Kerr asked for a motion to forgive any base currently in escrow or to be placed into escrow. Mr. Linney so motioned and Mr. Craun seconded. The motion was approved by unanimous roll call vote. APPROVE: Carlson, Craun, Jones, Kerr, Linney, Mayer OPPOSE: None As a result of the vote, aggregate base allocations are as follows: 2021 Milk Base Allocations effective March 1, 2021 Cooperative 9-Month Cooperative Milk Producers Association 15,215,465 Cumberland Valley Milk Producers Association 257,104 Dairy Farmers of America – Southeast 27,684,717 Dairy Farmers of America – Northeast 400,633 Land O’Lakes, Inc. 448,003 Maryland and Virginia Milk Producers Association 22,581,597 Mount Joy Farmers Cooperative Association 121,889 Lanco-Pennland Quality Milk Producers 2,954,462 TOTAL 69,663,870 Mr. Kerr asked for any public comment, but there was no additional input. The next Commission meeting is tentatively scheduled for Tuesday, September 21, 2021 with time and location to be determined at a later date. MEETING RECORDING: A full recording of this meeting can be found at the following link: http://www.vdacs.virginia.gov/mp3/02182021smcrecording.mp4 State Milk Commission Draft Minutes: February 18, 2021 Page 3 of 30 STATE MILK COMMISSION Crafton O. Wilkes, Administrator Announcement of Producer Class I Price at 3.5% Butterfat February 2021 DEC 2020 JAN 2021 FEB 2021 Eastern Market Established Price $8.46 $8.46 $8.46 Add Adjustment (per §2VAC15‐20‐81) $17.09 $12.36 $12.76 Eastern Market Class I Price (per cwt) $25.55 $20.82 $21.22 Eastern Market Skim Price (per cwt) 20.5550 15.7050 16.0515 Eastern Market Butterfat Price (per lb) 1.6324 1.6177 1.6372 Western Market Established Price $8.16 $8.16 $8.16 Add Adjustment (per §2VAC15‐20‐81) $17.19 $12.46 $12.86 Western Market Class I Price (per cwt) $25.35 $20.62 $21.02 Western Market Skim Price (per cwt) 20.3550 15.5050 15.8515 Western Market Butterfat Price (per lb) 1.6304 1.6157 1.6352 Southwestern Market Established Price $7.96 $7.96 $7.96 Add Adjustment (per §2VAC15‐20‐81) $16.88 $12.15 $12.55 Southwestern Market Class I Price (per cwt) $24.84 $20.11 $20.51 Southwestern Market Skim Price (per cwt) 19.8465 14.9965 15.3445 Southwestern Market Butterfat Price (per lb) 1.6253 1.6106 1.6301 Class II Price Announcement Date DEC 30, 2020 FEB 3, 2021 MAR 3, 2021 Milk Commission Class II Price (per cwt) $14.01 Milk Commission Class II Skim Price (per cwt) $8.9100 $9.0300 $9.2700 Milk Commission Class II Butterfat Price (per lb) 1.5469 Milk Commission Bi‐Monthly Composite Index 355.3 354.0 351.3 Milk Commission Assessment Rate (per cwt) 0.03950 0.03950 0.03950 Federal Order Base Class I Price (per cwt) $19.87 $15.14 $15.54 Price Change from January 2021 Class I (cwt) Skim (cwt) Butterfat (lb) Eastern Market $0.40 $0.35 $0.0196 Western Market $0.40 $0.35 $0.0196 Southwestern Market $0.40 $0.35 $0.0196 Next Class I Announcement: Feb. 18, 2021 Next Class II Announcement: Feb. 3, 2021 102 Governor Street, Richmond, VA 23219 www.vdacs.virginia.gov/food‐state‐milk‐commission.shtml Phone: 804‐786‐2013 Fax: 804‐371‐8700 Email: [email protected] State Milk Commission Draft Minutes: February 18, 2021 Page 4 of 30 Virginia Department of Agriculture and Consumer Services State Milk Commission Announcement of Producer Class I Price at 3.5% Butterfat February 2021 Virginia State Milk Commission Skim and Butterfat Prices, 2021 Eastern Market Western Market Southwestern Market Bi‐Monthly Month Skim Butterfat Skim Butterfat Skim Butterfat Index per cwt per pound per cwt per pound per cwt per pound January 15.7050 1.6177 15.5050 1.6157 14.9965 1.6106 354.0 February 16.0515 1.6372 15.8515 1.6352 15.3445 1.6301 351.3 March April May June July August September October November December AVERAGE 15.8783 1.6274 15.6783 1.6254 15.1705 1.6204 352.6 Virginia State Milk Commission Skim and Butterfat Prices, 2020 Eastern Market Western Market Southwestern Market Bi‐Monthly Month Skim Butterfat Skim Butterfat Skim Butterfat Index per cwt per pound per cwt per pound per cwt per pound January 16.3840 2.2482 16.1840 2.2462 15.6795 2.2412 347.0 February 15.1340 2.1776 14.9340 2.1756 14.4295 2.1706 345.0 March 15.7515 2.0550 15.5515 2.0530 15.0500 2.0480 343.5 April 15.1215 1.9932 14.9215 1.9912 14.4200 1.9862 340.0 May 14.1535 1.3491 13.9535 1.3471 13.4545 1.3421 334.1 June 12.8115 1.3680 12.6115 1.3660 12.1145 1.3610 332.5 July 16.2290 1.8584 16.0290 1.8564 15.5230 1.8513 336.4 August 18.9670 2.0306 18.7670 2.0286 18.2600 2.0235 346.5 September 18.6655 1.7340 18.4655 1.7320 17.9615 1.7269 351.6 October 15.8520 1.6521 15.6520 1.6501 15.1510 1.6451 347.4 November 18.4550 1.6884 18.2550 1.6864 17.7465 1.6813 348.4 December 20.5550 1.6324 20.3550 1.6304 19.8465 1.6253 355.3 AVERAGE 16.5066 1.8156 16.3066 1.8136 15.8030 1.8085 344.0 Winston‐ Washington, Prevailing Market Bristol Charleston Raleigh Salem DC Over Order Premium $1.83 $1.52 $2.48 $2.48 $0.88 Next Class I Announcement: Feb. 18, 2021 Next Class II Announcement: Feb. 3, 2021 102 Governor Street, Richmond, VA 23219 www.vdacs.virginia.gov/food‐state‐milk‐commission.shtml Phone: 804‐786‐2013 Fax: 804‐371‐8700 Email: [email protected] State Milk Commission Draft Minutes: February 18, 2021 Page 5 of 30 STATE MILK COMMISSION Crafton O.
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