2022 NMPF Annual Report

2022 ANNUAL REPORT

WE GAIN POLICY WINS— AND STAVE OFF NEGATIVE OUTCOMES FOR OUR MEMBERS—BECAUSE YOU INVEST IN NMPF. AND, IN KEEPING WITH THAT TRUST, WE INVEST OUR TIME, OUR PASSION, OUR SKILLS AND OUR ENERGY TO GET YOU RESULTS.

2022 Annual Report

National Milk Producers Federation

About Us

Established in 1916 and based in Arlington, Virginia, the National Milk Producers Federation (NMPF) carries out policies that advance the well-being of dairy farmers and the cooperatives they own. The members of NMPF’s cooperatives produce the majority of the U.S. milk supply, making NMPF the voice of dairy producers on Capitol Hill and with government agencies.

For more than 100 years, NMPF has been one of the country’s most recognized and influential membership organizations. Advocating policies determined by its members, the positions expressed by NMPF are the result of grassroots work by dairy farmers and their cooperatives on national policy.

From Our President and CEO

Every successful dairy farmer is familiar with the concept of Return on Investment (ROI), which is central to making smart business decisions. The most tangible ROI measure is financial—but what generates healthy returns is much more complex than that, ranging from smart spending choices to sweat equity to the simple determination to get things done.

One clear ROI for our members early this year was the U.S. Department of Agriculture’s (USDA) decision to allocate an additional $100 million in payments under the Pandemic Market Volatility Assistance Program to farmers for production up to 9 million pounds of milk during the six-month stretch of the COVID-19 pandemic when price imbalances in milk markets were at their worst. While not everything we sought (and are still seeking), that $100 million— on top of the $250 million already gained for the first 5 million pounds of milk— happened because we didn’t give up fighting for our members when a flaw in Class I pricing became apparent.

Along with rectifying that imbalance, this year we’re addressing the Federal Milk Marketing Order (FMMO) system itself, modernizing it in ways that will hold benefits for dairy farmers of all sizes, in all regions, among all business models. We’re also seeking regulatory clarity on everything from water rules to plant-based beverages. We do all this with a staff that’s lean, but mighty—and a membership that’s forward-thinking, influential, and willing to have the tough conversations necessary to forge the consensus this industry needs.

This year’s Activities and Accomplishments highlights our work across the federal policy spectrum. It also highlights how decisions in Washington connect with choices made from U.S. dairy farms to global milk markets, through our work with the National Dairy Farmers Assuring Responsible Management (FARM) Program, the U.S. Dairy Export Council (USDEC) and other partners. We gain policy wins—and stave off negative outcomes for our members— because you invest in NMPF. And, in keeping with that trust, we invest our time, our passion, our skills and our energy to get you results.

Thank you for that investment. I hope you benefit from reading about some of the returns it generated in 2022, and how those accomplishments are setting the stage for dairy farmers to gain greater benefits in the years ahead.

Jim Mulhern President and CEO National Milk Producers Federation

Government Relations

Securing Wins on Sustainability, Nutrition

NMPF’s government relations work in 2022 largely moved beyond the COVID-19 pandemic and focused on securing key wins on sustainability and nutrition policy, with further progress on ag labor reform.

NMPF also persisted in its work to rightsize a key USDA dairy pandemic program, which culminated in good news in January 2023 that additional support is on the way for thousands of dairy farmers.

NMPF’S GOVERNMENT RELATIONS WORK IN 2022 FOCUSED ON SECURING KEY WINS ON SUSTAINABILITY AND NUTRITION POLICY.

Key Advances

Fixing an Inequity for Dairy Farmers

First, fixing inequity. In August 2021, USDA unveiled the Pandemic Market Volatility Assistance Program, directly responding to NMPF’s advocacy for reimbursing dairy farmers of all sizes for unique pandemic-related losses that they suffered throughout the latter half of 2020. The program was initially slated to help producers recover $350 million of a total $750 million unintended loss they endured, but it limited reimbursements to five million pounds per farmer, which prevented many family dairy producers from recouping more than a minimal portion of their losses.

Following the program’s unveiling, NMPF immediately set out to make the program work for dairy farmers of all sizes. NMPF worked with key members of Congress to coordinate bipartisan efforts to seek additional funding for those producers whose reimbursements were limited by the program milk-production cap.

Thanks to NMPF’s efforts, USDA announced on Jan. 23 that $100 million remaining from the program’s original $350 million would be used to provide additional support for impacted producers. This support will provide reimbursement for losses up to nine million pounds of milk over the latter six months of 2020. While this does not fully close the gap, it will provide stronger reimbursements to those producers who endured difficult losses on all their milk production and would not have happened without NMPF’s year-long advocacy and direct engagement with members of Congress.

Making Net Zero a Reality

NMPF worked with Congress last year to enact a vital increase in farm bill conservation program funding. The Inflation Reduction Act, signed into law Aug. 16, provides nearly $20 billion for programs like the Environmental Quality Incentives Program, with a focus on climate-smart agricultural practices that can yield meaningful environmental benefits.

MELVIN MEDEIROS, A CALIFORNIA

DAIRY FARMER AND DAIRY FARMERS OF AMERICA MEMBER, HIGHLIGHTED DAIRY'S SUSTAINABILITY

PROGRESS DURING A HOUSE AGRICULTURE COMMITTEE LISTENING

SESSION ON JULY 7.

5 Led agricultural, antihunger, nutrition, and medical groups in urging the White House to prioritize access to affordable, diverse and nutritious food.

30% NMPF WON NEW FUNDING AND DIRECTION FOR THE FDA TO RECLASSIFY AND EXPEDITE ITS PROCESS FOR APPROVING ANIMAL FEED INGREDIENTS PROVEN TO REDUCE ENTERIC METHANE EMISSIONS BY AS MUCH AS 30 PERCENT.

This new funding will help dairy farmers advance their proactive sustainability leadership and fulfill their goals of becoming greenhouse gas neutral or better, improving water quality, and optimizing water use by 2050. NMPF led efforts within the agriculture and conservation communities to advocate for this funding, which includes $100 million targeted toward innovative projects that use feed management to reduce enteric methane emissions from livestock, a critical component of dairy’s Net Zero Initiative to fulfill its 2050 goals. The law also included NMPF’s long-sought Investment Tax Credit to help cover the upfront costs of methane digesters, another valuable tool in the Net Zero toolbox.

As part of the 2022 government funding package, NMPF won new funding and direction for the Food and Drug Administration (FDA) to reclassify and expedite its process for approving animal feed ingredients proven to reduce enteric methane emissions by as much as 30 percent. NMPF participated in FDA’s Oct. 18 listening session and remains committed to making these climatesmart ag feed ingredients more readily available to dairy producers.

Leading in Nutrition

NMPF also led efforts to safeguard schools’ ability to choose the milk varieties they serve, recognizing the vital role milk plays in providing kids the nutrients they need. In February 2022, USDA issued a rule protecting 1% flavored milk in school meals through the 2023-24 school year; the House Education and Labor Committee in July approved a child nutrition bill that bars USDA from preventing schools from offering milk varieties consistent with the Dietary Guidelines for Americans. Although not enacted, the House bill signals that protecting milk varieties consistent with the guidelines is a House priority.

In June, NMPF led 11 national agricultural, anti-hunger, nutrition and medical groups in a virtual listening session urging the White House to highly prioritize access to affordable, diverse and nutritious foods at its September Conference on Hunger, Nutrition, and Health. The session offered the White House both expertise and lived experience from a wide range of organizations on the importance of increased access to food and a diverse range of food choices in improving nutrition security and nutrition-related health.

The funding increases in the Inflation Reduction Act will better position dairy farmers to effectively implement the dairy sector’s Net Zero Initiative and fulfill its 2050 environmental stewardship goals.

- JIM MULHERN, NMPF PRESIDENT AND CEO

Jim Mulhern, NMPF President and CEO, attended the White House conference in September. NMPF was pleased that the White House strategy released with the conference echoes NMPF priorities to increase access for affordable food for all and culturally appropriate food options and recommendations.

Making Progress on Ag Labor

NMPF actively supported Sens. Michael Bennet (D-CO) and Mike Crapo (R-ID) throughout 2022 in their work to negotiate a bipartisan ag labor reform bill that would build upon and improve the House-passed Farm Workforce Modernization Act, including organizing and leading multiple outreach efforts from hundreds of ag organizations.

When the two senators were unable to resolve all issues needed to introduce a bipartisan bill, Sen. Bennet used points of agreement he had reached with Sen. Crapo as the basis for his ag labor reform bill, introduced in the final days of the congressional year. That measure, the Affordable and Secure Food Act, gained NMPF’s support by addressing dairy’s two overarching workforce needs— providing protection for current workers and their families as well as dairy access to the H-2A program—despite weaknesses in the bill, such as its cap on the number of year-round worker visas.

Sen. Bennet’s measure failed to receive a congressional vote in 2022. However, the work done by NMPF and others in the 117th Congress helped enhance the support and public pressure for reform.

CLINT BURKHOLDER, A MARYLAND AND VIRGINIA

MILK PRODUCERS

COOPERATIVE ASSOCIATION MEMBER, HOSTED HOUSE REPUBLICANS FOR A TOUR OF HIS PENNSYLVANIA

DAIRY FARM ON JULY 15.

Crafting a Sound FMMO Proposal

NMPF’s economics staff led NMPF’s crafting of a comprehensive set of recommendations to modernize and update the Federal Milk Marketing Order’s (FMMO) component and class pricing formulas. Many of these formulas have not been updated since they were first implemented in 2000 and have failed to keep up with the evolving structure of the U.S. dairy industry.

THE TASK FORCE DIVIDED INTO SEVERAL WORKING GROUPS AND HELD MORE THAN 100 MEETINGS TO GATHER CONSENSUS ON HOW THE PROGRAM SHOULD BE MODERNIZED.

Key Advances

1 Provided leadership and analysis for the NMPFled effort to modernize the FMMO system.

2 Reorganized economics staff to create the NMPF/ USDEC Economics Unit, a robust, industry leading analytical hub.

3 Successfully launched the new bi-weekly Leading Indicators Newsletter while maintaining full suite of industry-serving publications.

4 Provided DMI staff with critical analysis to help recraft the Innovation Center’s Vision and Goals for Food Security in the U.S.

Working with the Task Force

NMPF economics staff teamed with an organizationwide Economic Policy Committee Task Force in comprehensively working to craft an economically sound plan to achieve this long-overdue task. Along with NMPF staff, the task force comprised marketing and federal order experts from NMPF’s member cooperatives and Jim Sleper, a consultant engaged to manage this extensive undertaking.

The task force divided into several working groups and held more than 100 meetings to gather consensus on how the program should be modernized. Economics staff provided analytical support on all the manner of topic areas offering in-depth, index-based evaluations of changes in product manufacturing costs.

By summer, the Task Force had a completed set of recommendations, specifically:

• Update Federal Order make allowances to reflect higher costs and establish mandatory cost surveys to improve data quality moving forward;

• Amend mandatory price reporting specifications for nonfat dry milk and dry whey;

• Align milk component factors in the Class III and IV skim milk price formulas with current milk composition;

• Return to the “higher-of” Class I mover; and

• Remove barrel cheddar from the Class III product formula. These recommendations were presented to the Economic Policy Committee and the Board of Directors and approved unanimously by both groups.

Tackling More Complex Tasks

After meeting that challenge, the task force split into regional working groups to undertake the lengthier and more complex task of updating the more than 3,000 counties that comprise the Class I differential pricing surface. NMPF economics staff commissioned an updated and expanded version of the large-scale economic model used to develop the current Class I differentials. The task force completed its work in early 2023 and was approved by the Economic

Policy Committee and NMPF's Executive Committee in February. Upon approval by the NMPF Board of Directors, the complete proposal will be brought forward to USDA for consideration in a national hearing.

Unveiling New Collaboration

The economics staff’s depth of knowledge and experience in the dairy industry enables NMPF to proactively engage in complex issues with data and commercial impacts readily at hand.

NMPF expanded its collaboration with the U.S. Dairy Export Council (USDEC) to craft a joint NMPF-USDEC Dairy Economics unit. While cooperation between NMPF and USDEC has been long-standing, especially for the Cooperatives Working Together (CWT) export assistance program, the new team further streamlines knowledge sharing, expands staff expertise, and maximizes farmer and member dollars.

Together, the NMPF-USDEC Dairy Economics team provides expert insight into U.S. and global dairy markets for the industry, management and analysis into the CWT program, and offers analytical support to NMPF staff and members, USDEC and Dairy Management, Inc. under a contractual agreement. To assist cooperatives and farmers alike, the team regularly publishes numerous actionable intelligence reports, including the U.S. Dairy Market Report, Leading Indicators, the U.S. Trade Data Report, and the International Demand Analysis— all written with an eye towards future market conditions.

Trade Policy

Supporting Another Record Export Year

Dairy exports enjoyed another recordbreaking year in 2022, with year-end export numbers eclipsing $9 billion and amounting to approximately 18% of U.S. milk production. NMPF’s trade policy activities support those sales and help expand global opportunities for U.S. dairy products. That work is done in close partnership with USDEC, strengthening and broadening the industry’s trade voice.

NMPF SHAPED AND CHAMPIONED PASSAGE OF THE OCEAN SHIPPING REFORM ACT (OSRA), WHICH ENACTS NEW RULES AND REGULATIONS TO ADDRESS OCEAN CARRIER BEHAVIOR THAT DISADVANTAGED DAIRY EXPORTERS.

Key Advances

1 Shaped and championed the Ocean Shipping Reform Act to address ocean carrier practices and fees that disadvantaged dairy exporters.

2

Helped secure a U.S. victory in first-ever U.S.-Mexico-Canada Agreement dispute settlement panel regarding expanded dairy market access into Canada, then secured initiation of a second case against Canada in the face of Canadian non-compliance.

3

Tackled nontariff export barriers, including ironing out the introduction of a new EU dairy certificate, fending off Latin American anti-import policies and driving progress in U.S. dairy facility approvals in Indonesia.

4 Worked with the Consortium for Common Food Names to defend a federal court ruling that “gruyere” is a generic cheese style, an important U.S. precedent on common food names.

5 Ensured that tariff waivers for formula imports to address the temporary production capacity shortfall in 2022 remained shortterm and expired when the crisis had passed.

Leading Supply Chain Solutions

Working with USDEC and a coalition of agriculture organizations, NMPF proactively and successfully employed an advocacy and media campaign to drive solutions to the supply chain challenges that daunted dairy exporters last year. With the help of member feedback, NMPF shaped and championed passage of the Ocean Shipping Reform Act (OSRA), signed into law on June 16, which enacts new rules and regulations to address ocean carrier behavior that disadvantaged dairy exporters.

To drive further progress on supply chain issues, NMPF provided detailed input to the Federal Maritime Commission to steer OSRA implementation in a strong direction, prompted Congress and the Biden Administration to step in and preempt a rail worker strike on Dec. 2, and secured additional supply chain

support through new USDA funding for pop-up locations that offered off-terminal locations for empty container storage, increasing access for agriculture shippers and freeing up much-needed terminal space.

Holding Canada Responsible for USMCA Violations

While Canada continued to flout its dairy trade obligations under the U.S.-Mexico-Canada Agreement (USMCA), NMPF, together with USDEC joined forces with the U.S. Trade Representative’s (USTR) office and USDA to ensure that those violations would not go unaddressed and unpunished.

USTR announced in Jan. 2022 that the first USMCA dispute panel convened by the United States found that Canada was improperly restricting access to its market for U.S. dairy products in violation of its USMCA tariff-rate quotas (TRQs) commitments. Canada then revised its TRQ system,

NMPF PRESIDENT AND CEO JIM MULHERN JOINED PRESIDENT

JOE

BIDEN AND USDEC PRESIDENT AND CEO

but only superficially; on Dec. 20 USTR filed a new request for dispute settlement consultations to expand the scope of the second USMCA dairy dispute to include additional elements necessary to ensure that Canada fully complies with its USMCA obligations.

USTR followed that action by requesting on Jan. 31, 2023, a panel to hear this case. NMPF and USDEC have collaborated closely with USTR and USDA throughout to craft the strongest case to prove Canada’s violations and bring its policies into compliance.

Strengthening Key Partnerships Around the Globe

To strengthen NMPF’s ability to impact policy and standard development in international forums such as Codex and the World Organization for Animal Health, NMPF and USDEC expanded key partnerships with influential dairy organizations around the world. Growing relationships in Latin America, which has become a battleground over protectionist trade policies, has been particularly important. NMPF secured new agreements with like-minded agricultural organizations in Chile and Argentina, while building upon prior partnership arrangements with Mexico, the Inter-American Institute for Cooperation on Agriculture and the Pan-American Dairy Federation. These relationships set a foundation for NMPF and USDEC to draw upon in confronting emerging threats, such as regulatory trade barriers or proposals from anti-animal agriculture interests in international forums.

SHERYL MESHKE, PRESIDENT AND CEO OF ASSOCIATED MILK PRODUCERS INC., EMPHASIZED THE IMPORTANCE OF MARKET ACCESS DURING A SENATE SUBCOMMITTEE HEARING JUNE 9.

Beating Back Nontariff Barriers

Maximizing existing dairy market access opportunities is becoming more vital with the lack of new trade agreements, making NMPF and USDEC’s work with government officials on numerous nontariff trade barriers critical. Examples from 2022 include:

• Ensuring that new Mexican dairy regulations did not upend trade;

• Blocking a proposed ban in Ecuador on imported milk powder; ironing out the messy introduction of a new EU dairy certificate;

• Securing delays in the implementation of problematic Egyptian import requirements;

• Making headway on U.S. dairy facility approvals in Indonesia;

• Stood up for the right to use common cheese names, including defending against the appeal of a 2022 district court ruling upholding the generic nature of “gruyere”; and

• Championing projects in USTR’s non-tariff trade initiatives, such as the Indo-Pacific Economic Framework, that could yield improvements in U.S. dairy exporters’ trading conditions.

Ensuring Policy Responses Match Needs in the Temporary Formula Crisis

Confronted with a nationwide shortage of infant formula that demanded immediate remedy, NMPF engaged with Congress and the administration to ensure that policy tools designed to temporarily encourage additional infant formula imports were carefully crafted and didn’t become a tool for weakening the longer-term secure domestic production necessary to ensure robust supplies. Due to those efforts, NMPF was able to support legislation granting short-term tariff waivers on formula imports and make certain that they expired at the end of 2022 as the production crisis abated.

17.8%

THE PERCENTAGE OF U.S. MILK SOLIDS

PRODUCTION SHIPPED OVERSEAS IN 2022, AN ALL‑TIME HIGH.

Regulatory Affairs

Winning Through

Determined Defense Dairy’s biggest regulatory successes often come from a regulation not being proposed or a decision postponed. NMPF kept dairy from being dragged into commentary around per- and polyfluoroalkyl substances (PFAS) chemicals, which are an environmental-contamination issue focused on water. The regulatory team also worked closely with FDA and the National Conference on Interstate Milk Shipments Appendix N committee to develop a new antibiotic sampling program to further confirm the safety of the U.S. milk supply. NMPF also pushed back against a non-binding guidance from FDA that attempted to justify its decades of action on the labeling of plant-based imitators, even as the agency supported new nutritional disclosures on plant-based beverage labeling, an advance for dairy and its consumers.

1

Key Advances

Pressured FDA to ensure integrity in dairy labeling despite non-binding “guidance” justifying agency inaction.

2 Shaped the upcoming FDA antibiotic residue sampling assignment to ensure farmer and cooperative needs are being met.

3 Brought in elements from the Secure Milk Supply (SMS) Plan for Continuity of Business to support advanced development of the FARM Biosecurity module.

4 Worked with USDEC and DMI leadership to secure the 2023 International Dairy Federation World Dairy Summit for the U.S.

5 Kept dairy at the periphery of debates over PFAS, which remains a water issue.

Benefitting Dairy Through Environmental Efforts

PFAS and Waters of the United States (WOTUS) continued to be the main themes for NMPF’s environmental regulatory work. PFAS, which entered conversations in the 2010s when it was found on dairy farms in New Mexico and Maine, has been a focus for the Environmental Protection Agency (EPA) under the Biden Administration.

Recent EPA regulatory moves this year on PFAS have included proposing adding both PFOA and PFOS, two main PFAS chemicals, to the Comprehensive Environmental Response, Compensation and Liability Act list of hazardous chemicals also known as Superfund. NMPF submitted comments on November 7th, firmly against this move, stating the potential impact it could have on thousands of dairy operations. EPA has also announced an effluent guidelines program which includes a new study looking at Concentrated Animal Feeding Operation discharges including both nutrient and PFAS, from production and land application areas.

Other topics tackled in 2022 included speeding the pace of animalfeed additive approvals. While such additives hold promise toward moving dairy toward its promised net-zero future, their pace of approval lags that of competitors such as the European Union due to current FDA processes. NMPF in November urged FDA to allow feed additives to be treated as foods rather than as drugs, so the U.S. can maintain and advance its global leadership in dairy sustainability. NMPF and Newtrient in June supported USDA’s plan for a modernized “NRCS Conservation Practice Standard 592—Feed Management” to include ammonia, volatile organic compounds, greenhouse gases and dust, which will expand the opportunity for dairy farmers to use that standard for enteric methane-reducing feed additives.

NMPF’s long-term advocacy on climate smart agriculture paid dividends to the U.S. dairy industry in 2022. In September, USDA funded climate smart projects by California Dairies Inc., Dairy Farmers of America, Land O’Lakes, and the Maryland & Virginia Milk Producers Cooperative Association—which are

$245M

USDA FUNDED CLIMATE SMART PROJECTS BY CALIFORNIA DAIRIES INC., DAIRY FARMERS OF AMERICA, LAND O’LAKES, AND THE MARYLAND & VIRGINIA MILK PRODUCERS COOPERATIVE ASSOCIATION—WHO ARE LEADING OR PARTNERING ON SPECIFIC PROJECTS THAT MAY RECEIVE UP TO $245 MILLION IN FUNDING.

leading or partnering on specific projects that may receive up to $245 million in funding. USDA’s support recognized the robust efforts dairy farmers are leading to develop and implement climate-smart solutions that will benefit the entire food chain, from producer to consumer.

Enhancing Animal Health

NMPF has been active in efforts to enhance animal health and protect the U.S. dairy herd from foreign animal diseases. While USDA continues to modernize the Bovine TB and Brucellosis eradication programs, NMPF supported the Department’s efforts to modernize animal indemnity value determinations, including more frequent updates to reflect current animal values. NMPF supported updates to the USDA National Organic Program Livestock and Poultry Standards that further aligned with the ISO-accredited National Dairy FARM Program Animal Care Standards. NMPF also continues to convene the Tuberculosis Working Group, made up of both federal and state stakeholders, working to develop guidance for dairy farmers on human to cattle tuberculosis transmission.

A second year of USDA funding further strengthened the National Dairy FARM Biosecurity Program, with publication of the FARM Everyday Biosecurity Manual and further integration of the Secure Milk Supply Plan into the program. NMPF also joined an agriculture coalition letter to House and Senate leadership, supporting the swift passage of the Beagle Brigade Act. The Beagle Brigade is used at ports of entry (airports, seaports, land crossings) to detect

fruits, vegetables, and meats entering the U.S. as part of the system used to minimize the risk of Foot and Mouth Disease being introduced into the United States.

NMPF also worked with FDA and State regulatory officials on the design of a new three-year National MultiDrug Residue Raw Milk Monitoring Project that starts in 2023 and will guide the food safety risk assessment process to ensure drug residue testing requirements reflect the latest science, thus affirming the safety of U.S. milk. Only 1 out of 12,400 milk tankers tested positive for antibiotic residues last year, according to the 2022 National Milk Drug Residue Database annual report released by the U.S. Food and Drug Administration. The data illustrates the continued long-term national pattern of improvements in milk quality practices by the industry.

Reinforcing Dairy’s Importance to Diet

NMPF’s regulatory team also remained active in nutrition policy, a Biden Administration priority. Staff worked closely on comments on the transitional school meal standards rule as well to the proposed rule to the special supplemental program for women, infants and children. In addition, the 2025-2030 Dietary Guidelines for Americans process started, which has included submitting comments on the proposed scientific questions that determine the focus of the scientific committee.

From low-fat flavored to lactose-free options, parents, educators, and policy leaders overwhelmingly agree that milk on the menu encourages healthy kids and ensures that everyone has equitable access to the 13 essential nutrients milk provides through school meals.

- JIM MULHERN, NMPF PRESIDENT AND CEO

Continuous Improvement

The FARM Program updated and improved each of its program areas—Animal Care, Antibiotic Stewardship, Biosecurity, Environmental Stewardship and Workforce Development. Major highlights include furthering the development of Animal Care Version 5, publishing an updated Milk and Dairy Beef Drug Residue Prevention

Manual, publishing the Everyday Biosecurity Manual, launching the Environmental Stewardship Conservation Practice Questionnaire (CPQ) and beginning Environmental Stewardship Version 3 development, leading its first inperson Workforce Development Evaluator Training, and making FARM website and FARM database changes and bug fixes that improve user experience.

The FARM Program

Key Advances

1 Hosted more than 50 meetings or engagements on updating FARM Animal Care Program standards.

2 Received recertification from the Professional Animal Auditor Certification Organization for FARM Animal Care.

3 Published new resources including the 20222023 edition of the FARM Drug Residue and Prevention Manual and corresponding pocket guide, and the Everyday Biosecurity Manual.

4 Unveiled a new FARM Environmental Stewardship Conservation Practice Questionnaire enabling dairy farmers to better share their sustainability story.

5 Expanded the Workforce Development Program and conducted the first in-person Workforce Development Evaluator Training.

Heading Toward Version 5

The FARM Animal Care Program made progress toward its Version 5 standards updates through surveys, committee and task force meetings, and a public comment period. FARM Animal Care certified or re-certified 411 new and experienced animal care evaluators this year who together completed 8,625 Animal Care Version 4 evaluations in 2022. FARM Animal Care received Professional Animal Auditor Certification Organization (PAACO) recertification for the second year in a row. The FARM Program also released new and updated resources in 2022, including a Fitness to Transport video in conjunction with industry partners Elanco and Cargill, posters, fillable farmer resources available in English and Spanish, and optional trainings from partner organizations.

milk and meat. To make this critical information even more accessible, the FARM Program also released the Drug Residue and Prevention Pocket Guide that provides farmers and evaluators with a quick, easy reference to the updated list of approved drugs, screening tests, and withdrawal times under the FARM Program.

Adding Biosecurity Resources

8,625 ANIMAL CARE VERSION 4 EVALUATIONS COMPLETED BY FARM ANIMAL CARE CERTIFIED EVALUATORS IN 2022.

NMPF and FARM worked with the FARM Antibiotic Stewardship Task Force—composed of animal scientists, veterinarians, and animal health professionals—to draft and release the 2022-2023 edition of the FARM Drug Residue and Prevention Manual. This resource is the primary educational tool for dairy farmers on the judicious and responsible use of antibiotics, including avoiding drug residues in

The FARM Biosecurity Program, developed in 2021 through a cooperative agreement with USDA National Animal Disease Preparedness and Response Program, published the Everyday Biosecurity Reference Manual as well as other everyday biosecurity resource materials. Co-branded FARM/Secure Milk Supply materials for enhanced biosecurity, including the secure milk supply plan template, were created this year. FARM Biosecurity will help prevent the devastating impact and reduce the spread of potential disease events through planning and preparedness. In 2023, FARM Biosecurity plans to create additional resources that will help farms develop enhanced biosecurity plans for their operations including a training focused on how to develop a secure milk supply/ enhanced biosecurity plan.

Workforce Evaluation Progresses

The FARM Workforce Development (WFD) Program equips dairy owners and managers with tools to enhance their safe and thriving work environments. Since launching the FARM WFD evaluation in 2020, more than 300 evaluations covering HR and safety topics have been conducted on farms with a collective 6,300+ employees. The evaluations completed to-date offer a window into HR and safety practices of participating farms. In addition to three successful virtual evaluator trainings completed in 2022, the Workforce Development Program hosted its first in-person evaluator training in Syracuse, NY. Fifty-seven Workforce Development evaluators were certified in 2022 across 17 program participants.

Moving FARM ES Toward RuFaS

FARM Environmental Stewardship (ES) continued its widespread program implementation with evaluators conducting more than 750 evaluations. FARM ES launched a Conservation Practice Questionnaire (CPQ) as an optional add-on to the FARM Environmental Stewardship evaluation. The CPQ is designed to share a more holistic picture of dairy farmers’ sustainability story, address priorities covered in the industry-wide 2050 environmental stewardship goals

FARM

ES CONTINUED ITS WIDESPREAD PROGRAM IMPLEMENTATION WITH EVALUATORS CONDUCTING MORE THAN 750 EVALUATIONS.

Dairy farmers are on the frontlines confronting the many challenges associated with climate change and remain committed to making progress to reduce the industry’s environmental impact.

- JIM MULHERN, NMPF PRESIDENT AND CEO

and incorporate additional topics of customer interest. FARM Environmental Stewardship also released GHG fact sheets on the FARM website, which provide more background on sources of emissions on dairy farms and opportunities for GHG mitigation. The FARM Program, Dairy Management Inc. (DMI), and Ruminant Farm System (RuFaS) are collaborating to adapt the RuFaS model for the next version of FARM ES. The FARM ES Version 3 Working Group convened four times in 2022 to inform the evolution of FARM ES. Also in 2022, on-farm field testing of the scientific model began on six farms, with more slated for testing in 2023.

The FARM Program made website updates; fixed database bugs and made progress toward a database overhaul scheduled for 2023; and refreshed hundreds of free templates and resources for farmers and evaluators to use. To help with the improvements across all program areas, the FARM Program filled three open roles—program coordinator, information systems analyst, and communications lead—and worked with DMI to find a fit for their open customer outreach role. In the year to come, the FARM Program will continue to work with dairy producers, cooperatives, processors, and industry partners to demonstrate the highest standards on U.S. dairy farms.

SINCE LAUNCHING THE FARM WFD EVALUATION IN 2020, MORE THAN 300 EVALUATIONS COVERING HR AND SAFETY TOPICS HAVE BEEN CONDUCTED ON FARMS WITH A COLLECTIVE 6,300+ EMPLOYEES

Reaching Out

Sharing Dairy’s Story

and Adding Value NMPF outreach in 2022 ranged from showcasing farmer voices in guest newspaper opinion columns to highlighting the benefits of real dairy through the Real Seal campaign. A full return to in-person gatherings helped build dairy community, while the Cooperatives Working Together Program saw continued success in NMPF members working together to build exports.

NMPF OUTREACH IN 2022

RANGED FROM SHOWCASING FARMER VOICES IN GUEST NEWSPAPER OPINION COLUMNS TO HIGHLIGHTING THE BENEFITS OF REAL DAIRY THROUGH THE REAL SEAL CAMPAIGN.

Key Advances

Advancing FMMO at Denver Gathering

National Milk Producers Federation (NMPF) leadership unanimously endorsed a proposal to modernize the Federal Milk Marketing Order milk-pricing system at its annual meeting in Denver in October. It also welcomed new directors— as well as a new member.

“Dairy is positioned to be a trusted anchor in an uncertain world,” said NMPF Chairman Randy Mooney in remarks at the meeting, part of a joint event held by NMPF, the National Dairy Promotion and Research Board and the United Dairy Industry Association. “Together we can seize opportunities to feed the world. Our product is one of the most nutritionally valuable foods available. We create vibrant rural communities that keep America strong by helping to retain local schools, build energy independence, preserve the environment, and ensure food security for everyone.”

Central to discussions was recommendations developed on federal milk pricing after more than 100 meetings that have taken place over the past year. NMPF’s unanimously adopted modernization proposal, with a goal of being finalized in 2023, showed that “we have made tremendous progress and are moving forward with the strong level of consensus in the producer

community that we will need to achieve our goals of modernization,” said NMPF President and CEO Jim Mulhern. “The give and take that’s needed to get to anything important done will place the entire industry on a sounder footing, creating a lasting benefit for all.”

NMPF, whose member cooperatives produce more than two-thirds of the nation’s milk, also welcomed Burnett Dairy Cooperative to its membership. Burnett Dairy Cooperative, based near Grantsburg, WI and founded in 1896, is one of the nation’s few remaining full-service cheese-producing cooperatives. It is a frequent winner at both national and worldwide cheese contests. New directors elected to the Board of Directors and approved by NMPF delegates in 2022 included:

• Jeff Sims, Lone Star Milk Producers

• Kevin Ellis, Upstate Niagara Cooperative

• Cory Vanderham, California Dairies Inc.

• Joe Coote, Northwest Dairy Association

• Dan Rosen, Ellsworth Cooperative Creamery

• Rob Byrne, Dairy Farmers of America

• Frank Doll, Prairie Farms

• Christine Sukalski, Land O’Lakes

• Andy Mason, Land O’Lakes

1 Increased support record dairy exports through the Cooperatives Working Together Program.

2 Grew attendance at NMPF’s annual meeting as pandemic restrictions ebbed.

3 Advanced dairy through showcasing farmer voices in guest op-eds and collaborating with media organizations to share dairy’s story.

4 Developed dairy’s next generation of leadership via Young Cooperators programming.

THE NMPF CHAIRMAN’S AWARD WENT TO ELLSWORTH COOPERATIVE CREAMERY FOR THEIR PEPPERONI WITH MARINARA RUB CHEESE, WHICH ACHIEVED A 99.8 SCORE.

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PRAIRIE FARMS WON THE BEST COTTAGE CHEESE COMPETITION AND THE MOST RIBBONS AMONG CO OPS.

Together we can seize opportunities to feed the world. Our product is one of the most nutritionally valuable foods available. We create vibrant rural communities that keep America strong by helping to retain local schools, build energy independence, preserve the environment, and ensure food security for everyone.

- Randy Mooney, NMPF Chairman

AGRI-MARK RECEIVED THE CHAIRMAN’S RESERVE AWARD FOR ITS 10% VANILLA BEAN GREEK YOGURT, WHICH ALSO WON THE AWARD FOR BEST YOGURT.

5M IMPRESSIONS ACROSS ALL REAL SEAL MEDIA PLATFORMS.

NMPF'S ANNUAL YC LEADERSHIP AND DEVELOPMENT PROGRAM ATTRACTED 80 YOUNG FARMERS.

NMPF’S NATIONAL YOUNG COOPERATORS PROGRAM PROVIDED EDUCATION AND LEADERSHIP DEVELOPMENT OPPORTUNITIES FOR ITS MEMBERS THROUGH WEBINARS AND IN-PERSON EVENTS, REACHING MORE 750 PRODUCERS AND COOPERATIVE STAFF MEMBERS.

NMPF ALSO EXPANDED ITS REACH VIA PARTNERSHIPS WITH OTHER MEDIA ORGANIZATIONS.

National Milk Producers Federation

The give and take that’s needed to get to anything important done will place the entire industry on a sounder footing, creating a lasting benefit for all.

- Jim Mulhern, NMPF President and CEO

Delighting Judges with Cheese (Yogurt, Too!)

NMPF held its annual dairy contest with the meeting. Ellsworth took the top prize, while a yogurt also took high honors in the first-ever inclusion of that category, in prizes awarded in the held with NMPF’s annual meeting.

The NMPF Chairman’s Award went to Ellsworth Cooperative Creamery for their Pepperoni with Marinara Rub cheese, which achieved a 99.8 score. Agri-Mark received the Chairman’s Reserve Award for its 10% Vanilla Bean Greek Yogurt, which also won the award for best yogurt. Tillamook County Creamery Association earned the Best Cheddar award for its 2012 Makers Reserve, while Foremost Farms won the best Italian Cheese for its Mozzarella. Prairie Farms won the Best Cottage Cheese competition and the most ribbons among co-ops, with 18.

Showcasing Farmer Voices

NMPF communications staff in 2022 placed an emphasis on giving dairy farmers platforms before wider audiences and building partnerships with outside news organizations to provide the organization a broader platform.

Florida farmer Brittany Thurlow; Arizona farmer Josh Gladden, and California farmer Melvin Medeiros, NMPF’s Co-Op Farmer Communicator of the year, each penned guest columns printed in major daily newspapers representing their region, getting farmers before urban readers and supporting NMPF policy efforts in farmer assistance, immigration and sustainability. At the same time, NMPF’s Farmer Focus series of farmer profiles, done in conjunction with the FARM Program, told stories from farms of varying sizes and businesses from across the country.

NMPF also expanded its reach via partnerships with other media organizations, including Hoard’s Dairyman and the National Association of Farm Broadcasters, that put original NMPF content before their readers and listeners on a regular basis. With NMPF staffers serving as authors, topics ranging from the WOTUS rule and immigration policy to water and pricing issues, found broad exposure throughout the year.

Supporting the Next Generation of Dairy Leaders

NMPF’s National Young Cooperators (YC) Program provided education and leadership development opportunities for its members through webinars and in-person events in 2022, reaching more 750 producers and cooperative staff members.

The program organized ten 45-minute webinars throughout the year on topics including dairy economics, employee onboarding and effective on-farm communications. New in 2022, the YC Program partnered with the FARM Program, Dairy Girl Network and U.S. Dairy Export Council to offer joint webinars on topics of mutual interest.

The annual YC Dairy Policy and Legislative Forum convened in

We have made tremendous progress and are moving forward with the strong level of consensus in the producer community that we will need to achieve our goals of modernization.

- JIM MULHERN, NMPF PRESIDENT AND CEO

THE YC PROGRAM PARTNERED WITH THE FARM PROGRAM, DAIRY GIRL NETWORK AND U.S. DAIRY EXPORT COUNCIL TO OFFER JOINT WEBINARS ON TOPICS OF MUTUAL INTEREST.

Washington, D.C. on June 6–7 for the first time since 2019. Forty-five young and beginning dairy farmers from 15 states and representing ten member cooperatives participated in the two-day event, which included discussions about political engagement and dairy policy issues, along with training on how to be an effective advocate and spokesperson for dairy. YCs then headed to Capitol Hill to speak with members of Congress and their staffs about NMPF priorities including agricultural labor reform, dairy labeling, market access and the supply chain crisis.

NMPF hosted its annual YC Leadership and Development Program Oct. 23–24, attracting 80 young farmers representing eleven member cooperatives to the two-day professional development event in Denver, Colorado. Sessions during last year’s Leadership and Development Program included a risk management workshop and farmer panel, a primer on federal order pricing and an update on NMPF’s federal order modernization efforts.

Other programming featuring panels at the World Dairy Expo in Madison, WI in October and a YC a panel at Farm Journal’s MILK Business Conference in Las Vegas in December.

Members of the 2022 YC Advisory Council who provided regular guidance and feedback to enhance program offerings included:

• Valerie Lavigne, Chairperson, Agri-Mark, Inc.

• Dustin and Elizabeth Brunn, Vice Chairpersons, Dairy Farmers of America

• Sid and Kristin Huls, Prairie Farms

• Jaime Mowry and Matt Harrington, Upstate Niagara, Inc.

• Kip and Rochelle Siegler, Michigan Milk Producers Association

• Ben Smith, Maryland & Virginia Milk Producers Cooperative Association

• Jason and Tiffany Staehely, Northwest Dairy Association

• Brittany Thurlow, Southeast Milk Inc.

• Spencer Hurliman, Tillamook County Creamery Association

Impressing Millions with the REAL Seal

As the number of dairy imitators continued to proliferate, NMPF continued to offer marketers of real dairy foods the opportunity to demonstrate their commitment to high-quality, American-made products through the REAL Seal. Using social media platforms Facebook and Pinterest, the REAL Seal campaign generated content to contrast the nutrition, taste and value of dairy foods against the fakes, which usually pale in comparison in all three categories.

Impressions in 2022 across all REAL Seal media platforms totaled nearly 5 million. NMPF posted 157 pieces of social media content, including 12 featured brands. Those posts generated a 7.93% engagement rate (compared to industry average of 3%). Based on learnings from the previous year, the mix of tactics for 2022 shifted to focus more on brand awareness than drawing consumer traffic. Brand spotlights allow NMPF members using the Seal to build awareness for their specific products.

Assisting Dairy Export Sales

Year-end tallies indicate that CWTassisted sales rose in 2022, as the program did its part in supporting a record year for U.S. dairy exports.

Member cooperatives in 2022 secured 695 contracts, adding 98.0 million pounds of American-type cheeses, 657,000 pounds of butter, 30.7 million pounds of whole milk powder and 8.8 million pounds of cream cheese to CWT-assisted sales. In milk equivalent, this is equal to 1.212 billion pounds of milk on a milkfat basis. On a product volume basis, this is equal to 138.2 million pounds—up 6% (+7.9 million pounds) from 2021. Product destinations include Asia, Central America, the Caribbean, Europe, Middle East-North Africa, Oceania and South America.

Staff

Jim Mulhern President & Chief Executive Officer

Nicole Ayache Chief Sustainability Officer

Tom Balmer Executive Vice President

Alan Bjerga Senior Vice President, Communications

Paul Bleiberg Senior Vice President, Government Relations

Charlene Boulden Executive Assistant to the Office of the President & CEO

Nene Bundu Coordinator, FARM Program

Stephen Cain Director, Economic Research & Analysis

Jaime Castaneda Executive Vice President, Policy Development & Strategy

Clay Detlefsen Senior Vice President, Regulatory & Environmental Affairs

Chris Galen Senior Vice President, Membership Services & Strategic Initiatives

Khadija Gibson-White Program Manager, Cooperatives Working Together

Beverly Hampton Phifer Director, FARM Animal Care

Miquela Hanselman Manager, Regulatory Affairs

Abdullah Ibrahimzada Information System Analyst, FARM Program

Jamie Jonker Chief Science Officer and Vice President, Sustainability & Scientific Affairs

Louise Kamali Vice President, Meetings & Office Services

Patricia Koch Manager, Finance & Administration

Claudia Larson Senior Director, Government Relations

Will Loux Vice President, Global Economic Affairs

Gail Mobley Senior Director, Finance & Administration

Shawna Morris Senior Vice President, Trade Policy

Rachel Ravencraft Manager, FARM Program Communications

Tony Rice Manager, Trade Policy

Sage Saffran Manager, Sustainability Initiatives

Scott Sanborn Office Assistant

Emily Yeiser Stepp Executive Director, FARM Program

Theresa Sweeney-Murphy Director, Communications

Peter Vitaliano Vice President, Economic Policy & Market Research

Allison Wilton Coordinator, Economic Policy & Global Analysis

Bobby Yi Senior Director, Information Technology

Board of Directors

James Jacquier, Agri-Mark, Inc. –Connecticut

Sheryl Meshke, Associated Milk Producers Inc. – Minnesota

Steve Schlangen, Associated Milk Producers Inc. – Minnesota

Tom Beringer, Bongards' Creameries – Minnesota

Brad Anderson, California Dairies, Inc. – California

Gerben Leyendekker, California Dairies, Inc. – California

Robert Vandenheuvel, California Dairies, Inc. – California

Cory Vanderham, California Dairies, Inc. – California

Simon Vander Woude, California Dairies, Inc. – California

Neil Zwart, California Dairies, Inc. – California

Dale Mattoon, Cayuga Milk Ingredients – New York

Jimmy Kerr, Cooperative Milk Producers Association – Virginia

Rob Byrne, Dairy Farmers of America, Inc. – Kansas

Craig Edler, Dairy Farmers of America, Inc. – Wisconsin

Travis Fogler, Dairy Farmers of America, Inc. – Maine

Ed Gallagher, Dairy Farmers of America, Inc. – New York

Brian Hardy, Dairy Farmers of America, Inc. – Utah

Jerrel Heatwole, Dairy Farmers of America, Inc. – Delaware

Kent Herman, Dairy Farmers of America, Inc. – North Carolina

Neil Hoff, Dairy Farmers of America, Inc. – Texas

Harold Howrigan, Dairy Farmers of America, Inc. – Vermont

Karen Jordan, Dairy Farmers of America, Inc. – North Carolina

Jackie Klippenstein, Dairy Farmers of America, Inc. – Missouri

Chris Kraft, Dairy Farmers of America, Inc. – Colorado

Melvin Medeiros, Dairy Farmers of America, Inc. – California

Randy Mooney, Dairy Farmers of America, Inc. – Missouri

Doug Nuttelman, Dairy Farmers of America, Inc. – Nebraska

Jeff Raney, Dairy Farmers of America, Inc. – Pennsylvania

Brian Rexing, Dairy Farmers of America, Inc. – Indiana

Dennis Rodenbaugh, Dairy Farmers of America, Inc. – Kansas

Dan Senestraro, Dairy Farmers of America, Inc. – Kansas

Rick Smith, Dairy Farmers of America, Inc. – Kansas

Perry Tjaarda, Dairy Farmers of America, Inc. – California

John Wilson, Dairy Farmers of America, Inc. – Missouri

Dan Rosen, Ellsworth Cooperative Creamery – Wisconsin

Jeff Lyon, FarmFirst Dairy Cooperative – Wisconsin

Joe Becker, First District Association – Minnesota

David Scheevel, Foremost Farms USA – Minnesota

Greg Schlafer, Foremost Farms USA –Wisconsin

Joey Fernandes, Land O' Lakes, Inc. –California

Andy Mason, Land O' Lakes, Inc. –Maryland

Pete Kappelman, Land O' Lakes, Inc. –Wisconsin

Chris Sukalski, Land O' Lakes, Inc. –Minnesota

Jeff Sims, Lone Star Milk Producers –Texas

Jay Bryant, Maryland & Virginia Milk Producers Coop – Virginia

Joe Diglio, Michigan Milk Producers Association – Michigan

Doug Chapin, Michigan Milk Producers Association – Michigan

Gib Martin, Mt. Joy Farmers Cooperative – Pennsylvania

Joe Coote, Northwest Dairy Association/Darigold – Washington

Tony Freeman, Northwest Dairy Association/Darigold – Washington

Allan Huttema, Northwest Dairy Association/Darigold – Idaho

Frank Doll, Prairie Farms Dairy –Illinois

Joe Wright, Southeast Milk Producers–Florida

Joe Jenck, Tillamook County Creamery Association – Oregon

Craig Caballero, United Dairymen of Arizona – Arizona

Kevin Ellis, Upstate Niagara Cooperative, Inc. – New York

WE DO ALL THIS WITH A STAFF THAT’S LEAN, BUT MIGHTY—AND A MEMBERSHIP THAT’S FORWARD-THINKING, INFLUENTIAL, AND WILLING TO HAVE THE TOUGH CONVERSATIONS NECESSARY TO FORGE THE CONSENSUS THIS INDUSTRY NEEDS.

2022 Annual Report

National Milk Producers Federation