MMPA was formed on May 23, 1916 when a small group of dairy farmers from the Howell
area gathered at what was then the Michigan Agricultural College in East Lansing.
They met to establish a stable, reliable market and price for their milk. The principles
and organizational structure which these intuitive farmers established in 1916,
laid the ground work for what is now an integral part of today's dairy industry.
The basic premise of a cooperative, groups of people working together for the betterment
of all, has been instrumental in this country's history. We continue to do business
through cooperatives today because history ensures us that it works.
A cooperative is a business that is owned and controlled by its users. It differs
from an investor-oriented business where the control and ownership depends on the
amount of a shareholder's stock.
There are many differences between a milk marketing organization run by dairy farmers
and organization run by a board of directors disassociated with the dairy farm industry.
The decisions made by this cooperative are not only for increasing profits for the
members, but to make a better way of life for dairy farmers. The MMPA board of directors
are all dairy farmers with a vested interest in the success of this cooperative,
for much more than economical reasons. The dairy cooperative is one of the few places
left where dairy farmers have influence in directing decisions regarding their future.
Most importantly, MMPA guarantees payment for members' milk. In addition, any profits
gained through the marketing of the milk are returned to the entire membership--not
a group of stockholders.
With the amount of milk produced by dairy farmers, one day without a place to sell
their milk could be costly. MMPA guarantees a place for members' milk every day
of the year through its manufacturing plants, as long as the milk meets established
standards for health and sanitation. In the days before farmer cooperatives, creameries
often told farmers, "Sorry, we don't need your milk today." That meant the farmer
had to sell his or her milk elsewhere, usually for a much lower price, or dump it
down the drain. MMPA spares today's dairy farmer the burden of that worry.
Since 1916, some dairy farmers have lost sight of this important role. The likelihood
of losing a market for your milk is not as prevalent today, however, in the early
1990s, four important milk plants in Michigan shut down, leaving a number of producers
without their regular market. Those producers belonging to MMPA never missed a pick-up
or more importantly, a milk check. If it were not for MMPA's strength in Michigan's
milk marketing sector, many nonmembers would have lost a market and money.
MMPA members are paid for their milk twice a month regardless if a dairy plant for
some reason cannot pay for the milk on time or even goes bankrupt. In this case,
the member is paid and MMPA takes the legal steps necessary to get the money due
from the dairy involved.
Approximately, only 40 percent of the milk produced in Michigan is utilized in the
Class I marketplace (fluid milk). The milk which is not sold for fluid purposes
must be processed into other products. MMPA plays a vital role balancing the Michigan
milk market. Unlike fluid processing plants, which only buy the amount of milk which
they will use in the Class I market, MMPA buys milk from all producers, selling
it in all market classifications. This not only ensures producers that their milk
will be sold, but it ensures consumers of a steady supply of dairy products.
This market balancing function is possible because of MMPA's manufacturing plants.
Special thanks to Dan Tape for the initial design of this web site,
and for Jing Zhao's work on user roles and financial forms.