For Immediate Release: January 20, 2000

Northeast Dairy Compact Commission Releases $5.5 million for Northeast Farmers

MONTPELIER, VT The Northeast Dairy Compact Commission released $5,567,644.12 today for payment to more than 4,000 farmers in the six New England states and New York. This payment will help offset the 25 percent drop in the price of milk in December.

This pool payment -- an additional dollar for every 11.6 gallons of milk produced by the farmer is also the first Compact pool since September 1999 and the first pool since the Compact was reauthorized by the US Congress. This calculation is based on Class 1 milk (milk bottled for use as a beverage) sold in New England. The Compact only regulates the farm price of Class 1 milk.

The farm price of milk collapsed, primarily because of increased production in the western states of California, Idaho and New Mexico, most of which was made into cheese. The Federal Milk Market Order price, which is the basis for the Compact Over-Order Producer Price, is based primarily on the price of cheese. Most forecasts are for a depressed milk market throughout 2000.

Since implementation of the Compact over-order price regulation in July 1997, nearly $78 million has been returned to the region's farmers, including roughly $32.7 million to Vermont farms, $311,351 to Rhode Island farms, $23.8 million to New York farms, $3.8 million to New Hampshire farms, $4.6 million to Massachusetts farms, $6.8 million to Maine Farms, and $5.8 million to farms in Connecticut.

For more information on how the Compact producer price is determined or any other issue related to the Compact, please call David Ferch at (802) 229-1941.

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