For Immediate Release Contact: Tina Wisell

July 2, 1998 (802) 229-1941

Northeast Dairy Compact Meeting its Goals in Connecticut:

Retail Prices Stabilizing for Consumers as Less Farms are Going Out of Business

Northeast Dairy Compact Commission Executive Director Ken Becker announced today that less than a year after the Compact price regulation took effect, both consumers and farmers in Connecticut appear to be reaping the benefits of the Compact.

The Compact allowed for the establishment of a regional pricing mechanism for fluid milk sold in the New England states. Its purpose is to assure the continued viability of dairy farming in the region and to assure consumers of an adequate, local supply of pure and wholesome milk that is reasonably priced.

The Compact price regulation that took effect in July of 1997 sets a "flat" price for fluid milk. Since the Compact price sets a steady price it should smooth price fluctuations due to changes in the federal pricing system. The understanding is that both farmers and consumers will benefit from the stabilized pricing.

Mr. Becker stated, "The Compact appears to be doing its job because consumers in Connecticut are beginning to see stabilized prices at the retail level."

According to Connecticut Agriculture Commissioner Shirley Ferris, "In June of 1997, the month before the Compact took effect, the average retail price for a gallon of whole milk was $2.72. This June, almost a year after the Compact took effect, the price for a gallon of whole milk is only $2.73. And the price of a gallon of 1% milk is even less expensive now than before the Compact -- 3 less per gallon than last June."

Mr. Becker added, "Consumers also don't appear to be buying less milk because of the Compact price. According to A.C. Nielsen Corporation marketing research data, sales of fluid milk in the Hartford-New Haven, Connecticut area were up 2.5 percent in April from the same time a year ago, despite the fact that fluid milk sales nationally were down 1.6 percent for the same period."

Additionally, the Compact is beginning to meet its second goal of assuring the continued viability of dairy farming in the region. According to the Connecticut Department of Agriculture, the state had been losing more than 20 dairy farms a year. However, since January, only four dairy farms in Connecticut have gone out of business.