Pennsylvania Farm Bureau (PFB) asked the Pennsylvania Milk Marketing Board (PMMB) to keep the Class I over-order premium price for milk at $1.60 per hundredweight and to maintain the current fuel adjuster for the six-month period beginning April 1, 2016.
During testimony before the PMMB, Farm Bureau noted that the trend of declining milk prices for dairy farmers is continuing and that there is no anticipated relief from falling prices in the near future.
“What a difference a year makes,” said Somerset County dairy farmer Glenn Stoltzfus, who is a member of PFB’s State Board of Directors and chairman of its state Dairy Committee. “Our financial situation has not improved over the past year. In addition, we did not have sufficient cash funds to prepay our input expenses in 2016, as we have in prior years.”
Stoltzfus, who operates Pennwood Farms in partnership with three of his brothers, said that although the actual price of milk is important, the margin between the price and the cost to produce milk is even more important.
“Frankly, the price for feed, fuel and other inputs have not declined at the same rate as the significant reduction in milk prices we’ve experienced over the past two years. This means dairy farmers are likely to face tougher times ahead as they struggle to remain economically viable,” added Stoltzfus.
Farm Bureau says the over-order premium is essential to assisting Pennsylvania dairy farmers during times of uncertainty and falling prices.
“The level of premium received by dairy farmers is vitally important to the financial stability of Pennsylvania’s dairy farms,” concluded Stoltzfus.
The over-order premium and the fuel adjuster add-on mandated by PMMB are assessed on Class I (fluid) milk that is produced, processed and sold entirely within Pennsylvania, which is the fifth largest dairy producing state in the nation.