USDA bars dairy checkoff funds from backing ESG and climate initiatives
The U.S. Department of Agriculture announced it will no longer allow dairy checkoff funds to support environmental, social, and governance frameworks, net-zero targets, or climate-neutrality projects. The directive, issued by Under Secretary Dudley Hoskins, also applies to other commodity checkoff programs and aims to align spending with administration priorities on agricultural production and profitability. The action leaves the checkoff program intact but restricts how mandatory assessments can be used.
The directive specifically names several sustainability projects, including the Greener Cattle Initiative and the U.S. Dairy Net Zero Initiative, as targets for scrutiny. This action follows a lawsuit filed in June by three Wisconsin dairy farmers, represented by the Wisconsin Institute for Law & Liberty, which alleged that funding such initiatives exceeded statutory authority and violated the First Amendment. The defendants filed a motion to stay that case on Sept. 16, one day before the USDA's announcement.
The USDA's memo also instructs the Agricultural Marketing Service to apply the same restrictions to all commodity checkoff programs, not just dairy. The Innovation Center for U.S. Dairy, which coordinated many of these sustainability efforts, has maintained that its work aims to support both environmental and economic goals for farmers. The checkoff program itself remains operational, but the permissible uses of mandatory assessments are now significantly narrowed.
This directive could reshape how commodity checkoff funds are deployed, potentially slowing industry-led climate research and sustainability partnerships. Dairy farmers may see reduced assessments directed toward environmental projects, but they might also gain more control over how their mandatory contributions are spent. The legal case's outcome could set a precedent for other agricultural programs. Consumers may notice little immediate change, but long-term industry innovation in sustainability could be affected.