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Vol. 19 No. 9
I FARM
I TRENDS k Kk I
A summary of market J>y f/ICK
udcommoditynews n;
for the past week WHlUier
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Milk Prices Expected to Soar
A Wall Street Journal report this week painted a
glum picture for milk consumers Even the most
optimistic dairy experts, the report says, expect milk
supplies to continue dwindling and prices continuing
to rise, at least through the first half, and probably
throughout 1974. Because of uncertainty about costs,
though, the impact of these rising prices on milk
checks is unclear.
After an unprecedented string of seven price jumps
last year, milk was selling in Chicago last week for
$1.43 a gallon,-up 42 percent from $l.Ol a gallon a
year ago. Many dairy specialists say the price of a
gallon of milk will increase at least another 10 cents
by spring, with further increases possible later.
The problem is that supply isn’t keeping pace with
demand, and many dairymen say the gap will widen.
This national trend runs counter to the Lancaster
County picture. DHIA producers last year posted an
increase both in cow numbers and in production of
both butterfat and milk.
After increasing for three years, national milk
production in 1973 dropped 3 percent to an
estimated 116.5 billion pounds from 120.3 billion
pounds in 1972. This occurred while demand, spurred
by stepped-up buying of dairy products as substitutes
for high-priced beef, was increasing. Total con
sumption of milk, including that used to make cheese
and other products, rose 1 percent to 117.3 billion
pounds from 115.9 billion. Per-capita milk con
sumption rose for the second consecutive year to an
estimated 563 pounds from 561 pounds in 1972.
Before 1972, per-capita milk consumption had
declined every year since 1955.
Dairymen cut production because of falling profits
and, in some cases, heavy losses. While the prices they
received for their milk rose more than 30 percent in
1973, their costs rose even more precipitously. Feed
prices, accounting for about half of a dairyman's costs,
spurted dramatically. When feed prices peaked late
last summer, many were more than double year
earlier levels. In August, the milk-feed price ratio,
which is the number of pounds of feed equal in value
(Continued on Page 8)
Here’s a shot of those triplet calves
we mentioned the other week in
Lancaster Farming. The two bulls and
Lancaster Farming. Saturday, January 19, 1974
A Lancaster Farming Special Report, ..
Outlook Is Good
For Farm Credit
“Good fanners with good credit ratings won’t have any
trouble getting farm loans. But the interest cost will be
higher than last year,” we were told this week when we
contacted area farm lenders. Credit is tighter than last year
but available. You might expect some problems if you’re not
an established credit customer, or if you’re looking for
mortage money. But, if you and your fanning program are a
good risk, even these problems shouldn’t be too tough to
overcome.
In our survey, we talked to Carl Brown, manager of the
local Federal Land Bank and the Lancaster Production
Credit Association, Robert Bucher, manager of Com
monwealth National Bank’s Agri-Loan operation, George
Lewis, vice-president of Farmers First National Bank and
president of their newly formed Fanners AgCredit sub
sidiary, Stanley Musselman, assistant vice-president and
agricultural loan officer for National Central Bank, and
Merrill L. Mordan, president and agricultural loan officer for
National Central Bank of Honeybrook and chairman of the
Pennsylvania Bankers Association agricultural committee.
Overall, short term credit - any loan up to two years - is
available. Farmers who need loans for seed, fertilizer and
other items than can be paid with crop proceeds should have
no trouble as long as they stick with a bank that knows them.
Intermediate credit, likewise, should be no problem.
Money supplies for loans of two to seven years are probably
even more adequate than those for shorter terms.
While the bankers generally agreed that they weren’t
Rufus Martin Is Top
DHIA Milk Producer
Rufus G. Martin, Ephrata
RD3, was a three-way
winner at this year’s annual
Red Rose Dairy Herd Im
provement Association
banquet held Tuesday at the
Lancaster Farm and Home
Center. Martin’s Registered
Holstein herd topped all
other herds in the county
both in milk and fat
a heifer were born on the Robert
Weicksel farm in southern Lancaster
County.
production. His 25-cow herd
put out an average of 18,358
pounds of milk and 683
pounds of fat in the past
year.
The next highest herd was
owned by J. Z. Nolt, Leola
RDI. Nolt’s herd, also
Registered Holsteins,
produced an average of
17,322 milk and 655 fat.
Top prizes in breed
categories were based for
the first time this year on
total milk production rather
than butterfat, but there was
also a prize awarded to the
high fat herd. In addition to
his herd award, Rufus
Martin picked up the high
Holstein herd and the high
fat prizes. The high mixed
herd was a 33.2-cow herd
owned by Jacob S. Dienner,
Gordonville, RDI. Dienner’s
miscegenistic bovines
* produced 17,167 pounds of
milk and 604 of fat.
In This Issue
Markets 2-4
Sale Register 24-26
Farmers Almanac 6
Classified Ads 29-31
Editorials 10
Homestead Notes 18
Home on the Range 22'
Farm Calendar 6
Lebanon DHIA 12
overly anxious to tie up their funds in mortages, they did say
they would work with fanners who are seeking mortages.
Merest rates, we were told, wiD undoubtedly be higher this
year than last, but chances are they won’t go much higher. In
fact, there seems to be some feeling that the rates may be
headed downward, but that semi-prediction is far from a sure
thing. If a farmer needs money now, he’s better off not
waiting for the interest rate to come down, because loans
are generally renegotiate. And if he doesn’t need money,
now’s as good a time as ever not to borrow any.
In general, on all kinds of loans, farmers can expect to pay
an interest rate of anywhere from 8 to 9.5 percent, with the
rate for any loan depending partly on the institution and
mostly on the farmer and the purpose of the loan.
George Lewis told us that banks in general are a little
shorter of funds than usual, and that the cost of borrowing
has gone up. The shortage stems from the general ex
pansionary trend of the economy and depressed stock prices.
“When stock prices are down,” Lewis explained, “com
panies stop selling stock to raise capital and borrow instead
from banks because it’s cheaper for them.”
Interest rates have gone up, Lewis explained, because the
legal interest rates on savings accounts have risen from a
maximum of 5.75 percent last year to a high of 7.25 percent
this year. Because the banks pay more for their money, they
must charge more interest on the loans they make.
“Money is a little tight, but we will be able to take care of
(Continued On Page 32)
The top Brown Swiss herd
is owned by J. Rohrer
Witmer, Willow Street RD2.
The Witmer herd tallied a
total of 13,920 milk and 577
fat. The Jersey award went
to Robert W. Ulrich & Son,
Quarryville RDI, with 10,435
milk and 555 fat. K. O. and
Elsp Linde, Oxford RDI, had
the top Guernsey herd, with
11,872 milk and 548 fat.
In its annual report, the
local DHIA compared 1973
costs and profits with the
same figures for 1972. There
were increases in every
(Continued On Page 9)
Planning, Ashlea Top
Conservation Agenda
Aaron Stauffer, Ephrata
RDI, was reelected chair-
man of the board of Direc-
tors of the Lancaster County
Conservation district at the
group’s regular monthly
meeting held recently at the
Farm and Home Center,
Amos Funk, Millersville
RDI, was reelected vice-
chairman, Nancy Burkhart
was elected secretary-
treasurer. Reelected to four-
year terms on the board
S 2 00 Per Year
Robert Kauffman, Red
Rose DHIA president
were J. Everett Kreider,
QuarryvilleßDl, and Robert
K. Mowrer, 204 Laneview
Dr., Willow Street.
State laws requiring
conservation plans for every
Pennsylvania farm by 1977
were discussed at the
meeting. Area con
servationist Orval Bass
pointed out that his present
staff is totally inadequate to
the task of preparing more
(Continued On Page 6)