$0.75/cwt Over-Order Premium Established in Pennsylvania

The Pennsylvania Milk Marketing Board approved an order establishing the over-order premium at $0.75 per hundredweight for Class I milk. The order goes into effect on Oct. 1.

The decision was made during the Board’s Sunshine Meeting on Sept. 18. During the meeting it was also ruled to maintain the current formula for the diesel fuel add-on to the over-order premium.

To set the over-order premium at $0.75 per hundredweight, Board members heard testimony from representatives of the Pennsylvania Association of Dairy Cooperatives, the Pennsylvania Farm Bureau, the Pennsylvania Grange, the Progressive Agriculture Organization, and Board Staff.

“The Board appreciates the thoughts of farmers and cooperatives at the hearing that they would like to see a higher premium, but understand market conditions do not currently allow for that,” said Chairman Rob Barley.  “The consequences of setting the premium higher could possibly yield a negative for Pennsylvania farmers, a group the premium is supposed to help.”

Pennsylvania Farm Bureau’s (PFB) representative expressed that low milk prices seen in the past four years are threatening the livelihoods of dairy farmers in the state.

“The dairy industry is in dire straits and Farm Bureau would like to ask for a higher premium, but we are realistic about the current challenges of moving milk,” 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.

Coming into 2018, Stoltzfus and other dairy farmers were optimistic that dairy prices would rally, but those prospects appear to be low for the remainder of the year. Stoltzfus operates Pennwood Farms in partnership with three of his brothers.

“We are in survival mode on our farm and this is mirrored on many dairy farms across Pennsylvania. Since 2016, dairy farmers have been facing serious financial challenges and I’m sorry to say, I don’t see that changing anytime soon,” Stoltzfus said.

A copy of the order is available on the Board’s website at www.mmb.pa.gov.