A32-Lancaster Farming, Saturday, April 20,1985
March milk totals
(Continued from Page Al)
increase than anyone had an
ticipated.”
The reasons for the dramatic
increases in production are hard to
trace, and cannot automatically be
attributed to the anticipated end of
the diversion program, the dairy
economists noted.
In other areas of the country,
Fraher said, officials were ex
pecting production increases after
the end of dairy diversion, because
of the high percentage of
producers participating.
But, because of the relatively
smaller percentage of Nor
theastern dairymen who par
ticipated in the program, the
impact should have been much
less, he said.
“We have to be looking at far
more to explain increases here,”
he said.
The real reasons, the experts
said, involve the favorable feed
price to milk price ratio, and the
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generally profitable dairy
economy.
“The cows are there, the feed’s
there,” said Penn State University
ag economist Jack Kirkland. “I
don’t think there’s enough of a
price drop to get them to change.”
Feed prices are much lower than
they’ve been in quite some time,
notes Lackawanna County Ex
tension Director Thomas Jurchak.
And thus, because of the relatively
good milk prices of late, the milk
price-to-feed-price ratio is 1.64,
compared to 1.31 last year. The
higher the ratio, the more
profitable dairying becomes.
There’s also reason to believe
that policies that look good from
the national perspective may not
be very appealing from the
standpoint of the individual
producer.
An individual dairyman, for
instance, sees little opportunity to
do anything about the national
surplus of milk. He only knows that
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the more he produces, the more
he’s paid, whether prices are high
or low.
“If the signals are there, and the
economic conditions are good,”
adds Fraher, “the producers are
going to act like any rational
businessman and produce more
milk.”
In addition, the economic
pressures may simply be in
terpreted by individual dairymen
as forces encouraging them to
make their operations more ef
ficient.
For some, the only way to
become more efficient is to in
crease the amount of milk
produced, while decreasing costs,
by learning better management
techniques, using better feeds, or
increasing the size of the herd.
All this means lower price
supports and tough sailing for
dairy legislation in Congress in
late summer.
“It’s going to be brutal,” says
Jurchak. Prices have to go down,
he said, adding, “the law of supply
and demand has not been
repealed.”
Most agreed that dairymen face
an almost certain 50-cent reduction
in dairy price supports on July 1.
The reduction is linked to an
amount of government purchases
that will almost certainly be
surpassed at current production
levels.
And since new dairy policy will
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be charted in the next few months
anticipating the expiration of
current legislation in September
the long-range future of prices
certainly isn’t positive, the experts
noted.
“We may really see some
depressed prices,” added
Kirkland.
Much depends on the mood of
Congress, he noted, which may
well be that, “‘we have to crack
down on this now.’
“This increase certainly isn’t
helping farmers in Congress,” he
added.
Echoes Jurchak; “If we ball this
thing up at this point, it will
Eastern holds
SYRACUSE, Ny. - Earl R.
Forwood has announced that the
grand opening of the Canton
warehouse/dairy store complex
will be held Saturday, April 27. The
warehouse complex is the new
headquarters for Eastern’s suc
cessful Dairy Products Division.
The complex will be open from 10
am to 5 pm for inspection by the
public. There will be a ribbon
cutting ceremony at 11 am to of
ficially open the buildings.
Refreshments will be served af
terwards.
Eastern’s Dairy Products
Division was started six years ago
as a simple “products to
producers” program offering only
two products to Eastern members.
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determine how stringent a
program we will have to work with
in the future.”
Both Jurchak and Kirkland
noted the importance of the
Congressional efforts this sum
mer, and pointed out that a con
sistent approach to dairy policy
was desperately needed.
“Dairy policy is very com
plicated,” adds Kirkland. “But
hopefully, Congress won’t rush in
and make changes without
thinking them through. We are at a
crossroads of sorts. And we need
effective, logical policies that
consider the long run as well as the
short run.”
grand opening
The operation, managed by Thad
Woodward, currently offers over
120 products and achieved over
$6.1 million in gross sales in the
1983-84 fiscal year.
The Dairy Products Division
consists now of the
warehouse/dairy store complex,
retail stores located in Wellsboro,
and Newark, N.Y., and a truck
distribution system covering a
seven-state area.
Eastern Milk Producers is the
largest dairy cooperative in the
Northeast with over 4,200 mem
bers throughout Pennsylvania,
New York, Vermont, New Hamp
shire, New Jersey, Maryland and
Delaware.
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