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Pennsylvania Ag News Headlines
PA dairy groups back premium extension
Pennsylvania Ag Connection - 12/06/2023

Pennsylvania farm organizations are backing a proposal to extend the state's over-order dairy premium at $1 per hundredweight plus a fuel adjuster for six months.

The Milk Marketing Board will consider the proposal on Wednesday. The premium is paid to Pennsylvania dairy farmers on their milk that stays in state for processing and retail and is sold as a fluid product.

The Pennsylvania State Grange, the Pennsylvania Association of Dairy Cooperatives, and the Pennsylvania Farm Bureau all support the extension of the premium at the current level. However, some groups, such as Land O'Lakes, believe that the premium should be increased given the current market conditions.

The Senate Agriculture and Rural Affairs Committee has been working on a revamp of the over-order premium, but the process has been complicated by competing stakeholder priorities and interstate commerce law.

The Pennsylvania Association of Milk Dealers supports the status-quo premium level, while Dairy Farmers of America has not taken a position on the extension.

The over-order premium is built into the state minimum retail milk price, but not all milk qualifies for the premium. For example, milk processed out of state and milk used for cheese, powder, and other products do not qualify for the premium.

The extension of the over-order premium is expected to provide some relief to Pennsylvania dairy farmers who are facing rising production costs and soft milk prices. However, some groups believe that the premium should be reformed to ensure that it benefits all Pennsylvania dairy farmers and does not impose high costs on consumers.

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