E652 USDA Raised Make Allowances Up to 42.6% on Self-Reported Processor Costs

USDA added up to 7.15 cents per pound to processor make allowances on self-reported data. On 500 cows, that pulls up to $105,800 out of your pocket every year.

The Bullvine Podcast breaks down the June 2025 FMMO formula changes that stripped 85 to 92 cents per hundredweight across all four milk classes. While processors secured a 25.8% to 42.6% allowance hike on voluntary numbers, the mandatory audited survey to verify those costs sits stalled in regulatory notice. We run the farm-level math on the $231.9 million net pool revenue drop and examine how cooperative bloc voting passed the cut.

What You'll Learn

• Why the 85 to 92 cent cut hits your blend price regardless of which product class you ship

• How USDA raised allowances up to 42.6% on unaudited processor data while the mandatory survey stalls

• How cooperative bloc voting under 7 CFR Section 900.304 passed these cuts without individual member ballots

• Why the 6-month delay on updated milk composition factors cost producers an estimated $100 million

• How to stress-test your debt-service coverage ratio against a structural $195 to $211 per cow hit

This is not a market dip—it is a permanent formula deduction that drained $231.9 million net from producer pools in 90 days. On a 500-cow herd shipping 115,000 cwt, that is $97,750 to $105,800 gone every year at any milk price. Knowing whether your cooperative board filed a certified resolution to bloc vote your milk is the difference between blindly absorbing the hit and holding leadership accountable.

Listen & Connect Full article and sources: https://www.thebullvine.com/policy-markets-industry/fmmo-make-allowances-unaudited-costs/ Subscribe for straight-talking dairy analysis. Share this with a producer who needs it.