USDA Buys 7.9 Million Lbs. Of Process Cheese, 842,000 Gallons Of Fluid Milk

USDA’s Agricultural Marketing Service (AMS) this week announced the awarding of contracts for process cheese and fluid milk for delivery later this year.

USDA is purchasing a total of 7,920,000 pounds of process cheese, for a total price of $16.2 million, for delivery from Apr. 16 through Sept. 30, 2019.

That total includes 3,801,600 pounds of process loaves, 12/2-pound, at a price range of $2.0450 to $2.4200 per pound; and 4,118,400 pounds of process regular 6/5-pound loaves at a price range of $1.8501 to $2.1600 per pound.

This process cheese is being purchased under the authority of Section 32 of the Act of August 24, 1935, with the purpose to encourage the continued domestic consumption of these products by diverting them from the normal channels of trade and commerce.

The process cheese being acquired under this solicitation will be used for The Emergency Food Assistance Program (TEFAP).

Contracts awarded as follows:
Associated Milk Producers, Inc.: a total of 3,643,200 pounds of process regular 6/5-pound loaves, at a total price of $6,977,852.66.
Bongards’ Creameries: a total of 475,200 pounds of process regular 6/5-pound loaves at a total price of $1,011,740.40; and a total of 3,801,600 pounds of process loaves, 12/2-pound, at a total price of $8,228,982.96.

USDA last month had announced plans to purchase cheese for distribution to various food nutrition assistance programs, including TEFAP. The delivery timeframes for these cheese purchases will be April through September 2019. The agency plans to purchase both natural Cheddar cheese and process cheese.

In addition to soliciting bids for process cheese, USDA late last month had issued a solicitation for a total of 6,232,800 pounds of Cheddar cheese.
The purchase contract awards are expected to be announced in the near future.

Meanwhile, AMS this week announced awards for a total of 842,400 gallons of fresh fluid milk for deliver between Apr. 1 and June 30, 2019.

That total includes 100,800 gallons of 1 percent milk, 518,400 gallons of 2 percent milk, 190,800 gallons of whole milk and 32,400 gallons of skim milk. The total price of the purchases is 42,656,239.66.

These fluid milk purchases are being made under the trade mitigation Food Distribution and Purchase program. The fluid milk will be used for TEFAP.

AMS had issued a solicitation in early February seeking offers for a total of 5,490,000 gallons of fluid milk for delivery in April, May and June 2019.

In February, the agency announced purchase contract awards for a total of 4,525,200 gallons of milk. No offers were received for 964,800 gallons.
AMS then issued a solicitation for that 964,800 gallons of milk, and this week announced awards for 842,400 gallons of milk. No offers were received for 122,400 gallons of milk.

This week’s fluid milk purchase contract awards were announced as follows:
Borden Dairy Company: a total of 50,400 gallons.
Dean Foods Company: a total of 496,800 gallons.
GH Dairy El Paso: a total of 43,200 gallons.
Hiland Dairy Foods Company, LLC: a total of 32,400 gallons.
Hollandia Dairy, Inc.: a total of 64,800 gallons.
Shamrock Foods Company: a total of 90,000 gallons.
Upstate Niagara Cooperative, Inc.: a total of 64,800 gallons.

USDA launched the Food Purchase and Distribution Program last year to assist dairy and other farmers in response to trade damage from retaliatorty tariffs being imposed by US trading partners.

Under that Food Purchase and Distribution Program, USDA plans to purchase up to $1.2 billion in commodities targeted by retaliation, including $84.9 million in dairy products.

USDA initially purchased cheese products under the program.

AMS plans to buy affected products in four phases. The agency purchased known commodities first. The materials purchasesd can be adjusted between phases to accommodate changes due to growing conditions, product availability, market conditions, trade negotiation status, and program capacity.

By buying in phases, procurement of commodities that have been sourced in the past can be purchased more quickly and included in the first phase, USDA had explained last year.

Last year, USDA had also purchased fluid milk for distribution to TEFAP, but those purchases were made under the authority of Section 32 of the Act of August 24, 1935, with the purpose of encouraging the continued domestic consumption of the fluid milk products by diverting them from the normal channels of trade and commerce..


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