(Continued from Pago At)
price, the M-W has risen $1.55
above that minimum price.
Jim Fraher, an economist for
the Southampton, Pa.-based
Atlantic Dairy Cooperative, has
had to revise his price forecast
upwards several times, but he’s
not complaining.
That’s because a higher M-W
means higher farm milk prices.
The U.S. Department of Agricul
ture uses the M-W to set prices in
its nationwide federal order sys
tem. The $ll.BB October price, for
instance, translates into an $11.96
October Class II price and a
$14.01 December Class I price in
Federal Order 4, which governs
milk marketing in the Mid-
Atlantic area. Similarly, it means a
$14.43 Class I price in Federal
Order 2, the New York-New
Jersey order.
Add to these gains the proceeds
from the $1.05 Class I premium
imposed by the Pennsylvania Milk
Marketing Board and the Middle
Atlantic Cooperative milk Mark
eting Agency or the 70-cent pre
mium commanded by the Region
al Cooperative Marketing Agency
and local dairymen are seeing
their highest prices in several
years.
The M-W traditionally rises in
the fall as the supply-demand situ
ation tightens.. But this year’s
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the reason.
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monitored throughout gestation. Their young are cross
fostered to insure a higher rate of survival, then registered by
computer, so as to provide day by day progress reports for the
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The amount of heat, humidity, water, and rations each hog
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larger-than-normal gains reverse,
at least temporarily, the overall
downward trend in milk prices
since the federal government
began slashing its support price in
1985. The M-W is now higher
than it’s been at any time since
November 1986. With the $1.05
over-order premium, December’s
effective Class I price of $15.96 in
Order 4 will be the highest ever.
Fraher estimated that when you
figure in both assessments and
over-order premiums, overall
farm milk prices will average
seven cents higher in 1988 than in
1987. But, he added, farm costs,
particularly feed, are much higher
as well.
Indeed, the milk-feed price
ratio in the Northeast stood at 1.43
in October, according to a spokes
man for the Pennsylvania Agricul
tural Statistics Service. Despite a
substantial improvement from
July’s 1.22 average, this ratio is
still below its level of a year ago.
The ratio, which compares the val
ue of a 16-percent protein dairy
ration to that of farm milk, mea
sures the profitability of milk
production.
Analysts agree sharply higher
prices for cheese and non-fat dry
milk are largely responsible for
this year’s M-W gains. Between
mid-June and early October, the
price for 40-pound blocks of ched-
oar rose 17.73 cents, to 51.31 3/4,
and the price of 500-pound barrels
rose 19 cents at the National
Cheese Exchange in Wisconsin.
Buyers appeared to be influenced
by concern that the nationwide
drought would seriously curtail
fall milk production.
Moreover, unlike past years,
surplus stocks of these commodi
ties are no longer being held by
the government, enabling prices to
rise farther and faster, according
to Robert Vaughan, general mana
ger of Maryland and Virginia
Cooperative Milk Producers
Association.
Will the M-W climb still high
er. Fraher doesn’t think so. He
predicts the November price will
be the same as October’s. On the
other hand, Vaughan, speaking to
Maryland and Virginia members
attending a recent district meeting
in Frederick, Md., said the M-W
should rise another 15 cents.
However, both Vaughan and
Fraher project seasonal declines to
the $lO.BO level during next year’s
spring flush, when the govern
ment will temporarily raise the
support price 50 cents as a result
of the drought relief legislation
passed recently.
But, Vaughan said, that still
means higher,prices next spring
than was the case in 1988, when
the M-W hovered around the
$10.33 support price.
The outlook for the longer term
sturdy, well built equipment specially designed to meet these
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and nutrients to each hog.
The result is more hogs actually going from finisher to
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(717) 393-5807
will depend primarily on what va ™ a and New York and down
happens to production on an fhree percent in Maryland, for
national level, Fraher said. Sur- instance. The biggest gains have
prisingly, this year’s gains were 156611 registered by states in the
accomplished despite the fact that West > particularly Texas, where
dairymen appear to be heading for y®ar-to-date production has run 13
a record 143.5 billion pounds pro- P®reent ahead of 1987.
duced in 1988. In October, the last M . ost economists predict pro
month for which data has been duction will decline in at least
published, milk production in the som ® states in the first part of
21 states surveyed regularly by 1989, when many dairymen may
USDA was 1.9 percent higher h? vet 0 coni ® to grips with the
than it was in 1987 and three per- higher feed costs created by the
cent above 1986’s total. The year- drought. However, many also
to-date total was two percent ors6e production rebounding and,
ahead of a year ago. hence, prices falling below year-
The distribution of those gains ear ** er levels in the latter half of
has been uneven across the coun- *he year. For 1989 as a whole,
try. On a year-to-date basis, pro- P riC6S should average slightly
duction has been even in Pennsyl- more dtan they did in 1988, Fraher
said.
Route 30 West
at the
Centerville Exit
wad
LANCASTER FARMING
FOR COMPLETE
AND UP-TO-DATE
MARKET REPORTS
Lancaster To Hold
Penn State Tax Meeting
LANCASTER
Tax preparers, farmers,
homemakers and other
interested individuals
IS
1 j #
*> w
% 1
s
can attend a federal
income tax update at the
Lancaster County Farm
and Home Center, 1383
Arcadia Road, Lancas
ter, on Thursday, Janu
ary 19th from 8:30
A.M. - 4:00 RM. The
registration fee is S3O
per person, including
lunch and reference
materials before
December 23, and $4O
after December 23. A
brochure/registration
form and more informa
tion about the 1989 area
income tax meeting is
available from the
Chester County
Cooperative Extension,
235 W. Market Street,
West Chester. Ques
tions about the meeting
may be directed to Alan
W. Strock, County
Farm Management
Agent, 215-696-3500.
Information pre
sented at this meeting
will be helpful as tax
payers approach the
new tax filing season.
The topics covered at
the meeting will range
from a look at new
developments to a
review of important tax
principles. The program
will include a discus
sion of tax law changes
affecting individuals
| and businesses, tax
form changes and criti
cal issues for filing the
1988 tax return. Hand
out materials will be
provided to support
.instructor’s discussion.
Additional reference
materials, including a
Masters Federal Tax
Manual, may be pur
chased for a small fee.
Jesse G. Cooper and
Larry C. Jenkins, Penn
State University facul
ty, will be assisted by
Semal Revenue Ser
e personnel. If unab
le to attend the session
at Lancaster call the
Chester County Exten
sion office and find out
about the next closest
location. Penn State is
an affirmative action,
equity opportunity