’90 support prices for milk to remain in effect for 1991

SKOWHEGAN — The $10.10 per hundredweight support price in effect for milk was not changed Jan. 1, and will remain in effect through 1991, according to William H. Moirs, county executive director of Somerset County Agricultural Stabilization and Conservation Service. This decision was made in accordance with the Food, Agriculture, Conservation and Trade Act of 1990.

In compliance with the Omnibus Budget Reconciliation Act of 1990, this is a 5 cent per hundredweight reduction in the price received by producers for all milk produced within the 50 states, District of Columbia, Puerto Rico and U.S. Territories, and marketed for commercial use in calendar year 1991. Moirs said the reduction would be 11.25 cent. The reduction is to be increased May 1 of each of these years, as needed, to compensate for refunds made the previous year.

Moirs added that milk producers receive a refund of the entire amount deducted for their milk proceeds if evidence is provided that they did not increase milk marketings over the year before.

Since the support price for milk did not change, the Commodity Credit Corp. purchase prices for butter, cheese and nonfat dry milk also remain unchanged. Under the dairy price support program, a price is set for manufacturing grade milk. The program authorizes the CCC to purchase butter, cheese and nonfat dry milk at announced prices to enable manufacturing plants, on the average, to pay farmers an amount equal to the support price. The milk surplus is the difference between milk marketings and commercial sales.

Farm program legislation requires an increase of the support price for milk when estimates of net surplus purchases of dairy products under the program fall below 3.5 billion pounds, milk equivalent, for the calendar year. The CCC’s net purchases under the dairy price support program for calendar year 1991 are estimated at 6.4 billion pounds, milk equivalent.

According to Moirs, the $10.10 support price is for manufacturing milk with a milk-fat content of 3.67, and compares with $9.90 per hundredweight for milk with a fat content of 3.5 percent. “The support price will assure an adequate supply of wholesome milk to meet current needs,” ASCS official Moirs said.