By Jamie Martin
The U.S. Department of Agriculture has introduced a significant change to the Dairy Checkoff Program by ending the use of producer-funded checkoff dollars for Environmental, Social, and Governance (ESG) initiatives.
The announcement was made by U.S. Secretary of Agriculture Brooke L. Rollins, who said the action supports the administration's commitment to ensuring that farmer-paid assessments are used to benefit agricultural producers and strengthen U.S. agriculture.
Checkoff programs are funded through mandatory assessments paid by farmers and ranchers. These programs are designed to support research, promotion, education, and market development efforts that increase demand for agricultural products.
She added, "Today's action returns the Dairy Checkoff and all research and promotion programs to their core mission: expanding markets and supporting the hardworking men and women who feed this country.”
USDA said dairy checkoff resources will now be focused exclusively on their statutory purpose of promoting dairy products, supporting research, and providing nutrition education. The agency stated that producer-funded dollars should not be used to support ESG commitments, emissions targets, net-zero programs, or other sustainability mandates.
The policy specifically affects ESG-related work that has been associated with dairy industry sustainability programs. USDA explained that the change is intended to keep checkoff activities aligned with the original mission established under federal law.
In addition to dairy, the Agricultural Marketing Service has been instructed to review other commodity promotion and research programs to ensure checkoff funding is not used for ESG-related requirements. USDA said the goal is to maintain consistency across commodity boards and ensure assessments are spent according to their intended purpose.
The department emphasized that the change does not signal opposition to all industry programs. Rather, it is intended to ensure that producer-funded investments focus on activities that directly support markets and contribute measurable value to farmers.
Economic studies suggest that checkoff programs can create significant returns for agricultural producers. Research conducted by independent economists at Texas A&M University found strong returns from dairy promotion investments.
The study reported an overall dairy return on investment of $5.93 for each dollar spent. Returns vary by product category, with particularly high returns for butter and export promotion. The findings also showed positive impacts on demand for dairy products in both domestic and international markets.
Other commodity sectors have also reported strong checkoff returns. USDA cited returns of $13.41 for beef, $6.40 for cotton, and $33.54 for softwood lumber programs.
Industry stakeholders are expected to closely monitor how the policy affects future research and promotion activities. The decision could influence priorities within dairy organizations, marketing campaigns, and research initiatives that receive checkoff support.
For producers, the policy change reflects an increased focus on economic performance, market growth, and accountability. USDA maintains that every dollar collected through mandatory assessments should work toward expanding opportunities for American agriculture.
As implementation begins, the dairy industry will gain a clearer understanding of how future investments and programs will be structured under the new guidelines. The department believes the change will help ensure producer-funded programs remain focused on delivering direct benefits to farmers, ranchers, and rural communities.
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