Is De-pooling from Federal Orders Growing?
This post will cover de-pooling in the three largest Federal Orders, the Upper Midwest, California, and the Southwest. In the Upper Midwest, an estimate of de-pooled milk is included in their monthly statement. In the California and the Southwest Federal Orders, the amount of de-pooling was estimated by comparing the volume of milk produced and the amount marketed through the Federal Orders. Most of the milk produced within a Federal Order is processed in that Federal Order and this calculation provides a reasonable estimate of de-pooling.
De-pooling does not make more money. It only moves money around with the de-pooling party getting more money and others getting less. Who is the main looser? Class I milk, because it cannot be de-pooled. Who else may be on the loosing end? Once milk is de-pooled it is not protected by the Federal Order minimum pricing and may be getting a lower price than the pricing in the Federal Order.
April 16, 2023