The process of federal milk order reform that began with passage of the 1996 farm bill proceeded another step forward on October 19, 2001, when USDA issued yet another recommended decision. This decision altered certain parts of the interim final decision issued on December 1, 2000. Specifically, the 2000 interim final rule, among other changes, established a Class III butterfat price separate from the Class IV butterfat price. Before the new butterfat pricing rules became effective, several industry groups successfully sought an injunction in federal court. The most recent decision conforms to the injunction by formally altering the 2000 decision to retain common Class III and Class IV butterfat values. A few other modifications to the 2000 decision were made, the most important one being a revision of the protein price equation that eliminates the anomalous negative effect of butter prices on the Class III price. USDA will accept comments on its recommended decision through November 26, 2001 and issue a final decision for a producer referendum shortly thereafter.