An introduction to federal marketing orders
Understand the regulations designed to help stabilize market conditions for milk, fruit and vegetable products.
Federal marketing orders are regulations designed to help stabilize market conditions for milk, fruit and vegetable products. These programs, administered by the United States Department of Agriculture, Agriculture Marketing Service (AMS), assist farmers to collectively address marketing challenges. Producers initiate the request for a marketing order with the USDA. A referendum vote of growers and handlers who will be included in the marketing order must then pass by at least two-thirds support to implement the regulation. The frequency and timing of referendum votes varies by commodity. If dates are not pre-determined in the language of a specific marketing order, the USDA recommends a referendum be held once every six years (Sparks USDA AMS 2011). Once a marketing order has been enacted, it is binding for all handlers and growers of the commodity in the geographic area covered by the order.
Marketing orders were first implemented during the 1930s in response to the low farm prices experienced during the Great Depression. Congress enacted the Agricultural Adjustment Act of 1933 to elevate farm prices. When the marketing orders and other USDA programs were met with mixed review by consumers and constitutional challenges by processors, Congress enacted the Agricultural Marketing Adjustment Act (AMAA) of 1939 to further define its intent to establish and maintain orderly market conditions for agricultural commodities in interstate commerce.
Currently, there are three basic categories of economic activities regulated by market orders: quality controls, quantity controls and market facilitating activities. Specific provisions of marketing orders may be designed to do the following: maintain the high quality of product available on the market; standardize packages and containers; regulate the flow of product to market; establish reserve pools for storable commodities; and authorize production research, marketing research and development, and advertising (USDA AMS 2011).
In Michigan, fruit and vegetable products regulated under federal marketing orders are tart cherries and cranberries. In the case of tart cherries, the order became effective on Sept. 24, 1996. The order authorizes volume controls that provide for a reserve pool in response to annual supply fluctuations. Other provisions (not currently in use) include restrictions on minimum grade and size and authorization for market research, development and paid advertising. More information can be found at the USDA’s Marketing Order 903: Tart Cherries website.
The cranberry marketing order was originally enacted in August 1962 and contains provisions for production and market research including development and paid advertising. More information can be found at the USDA’s Marketing Order 929: Cranberries website.
Did you find this article useful?