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Farm Bureau Urges Hold On Over-Order Milk Price Premium

Farm Bureau Urges Hold On Over-Order Milk Price Premium

Pennsylvania Milk Marketing Board weighs keeping Class I milk price premium at $2.15. Dairy farmer cites shortages of high-cost feed. Decision expected soon.

Pennsylvania dairy farmers have a built-in milk price advantage many states would love to have – an over-order market premium on Class I (fluid) milk. It's regulated by the state's Milk Marketing Board, which reflects industry and consumer interests.

On Wednesday, PMMB held a hearing to consider whether to adjust the premium for the six-month period beginning January 1. Pennsylvania Farm Bureau presented its case for holding that milk price premium at $2.15 per hundredweight.

Severe weather conditions, especially extremely wet weather, has negatively impacted crops grown for feed, noted PFB Vice President Richard Ebert, also a Master Farmer from Blairsville, Pa. "From an incredibly wet spring to an extremely hot July and August to a September filled with rain and flooding, nearly all Pennsylvania farmers are dealing with some sort of repercussion from Mother Nature's onslaught," said PFB's State Dairy Committee.

"On my farm, thanks to the wet weather, not only are we still chopping hay, but we're also facing feed quality issues. In times of tight margins, feed quality is vitality important as it allows us to attain optimum milk production."

The Westmoreland County dairy farmer, who milks 80 Holstein cows and grows corn, alfalfa hay and soybeans, noted that this year's harvest of hay and corn is down and that the overall quality of crops used to feed his cows on the farm is not at the premium level that he is normally able to achieve. That's also the case with the majority of dairy farms across Pennsylvania.

"Unfortunately, the problems we've had harvesting means that our silos won't be quite full this year and as a result, I'll have to buy additional hay to feed the cows.  We've also seen reductions of five-to-six pounds of milk per cow, per day," added Ebert.

Historically high production costs are putting additional stress on a farmer's ability to remain viable.  "I know that the current milk price sounds good, but between the continued high input costs and the impact of the weather, dairy farmers are still challenged in turning reasonable profit margins," concluded Ebert.

That's why Farm Bureau also asked the PMMB to maintain its current premium price add-on for fuel costs.  Dairy farmers whose milk is produced, processed and sold in Pennsylvania for Class I use, receive an additional premium based on the cost of fuel.

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