22-(Sec. II) Statesman, Salem, Ore., Mon., June 11. '56
Dairy Industry
Divided Over
Price Boosts
t OVID A. MARm
Associated Press Farm Reperter
WASHINGTON If Americans
face the prospect of higher year
around prices for milk. But if the
increases come. H will not b with
out fight within the dairy In
dustry Itself.
la many urban area consum
ers already are paying from one-
half to two eenti a quart more
for their milk than they had been
scheduled to pay this print '"d
Mail and phone orders J
open Monday and Friday ,
h IMS to P. M.
OTHER DAYS MO A. M. TO 130 f. M.
FREE STORE-SIDE PARKING
FOR OVER 1,000 CARS
summer.
Acting under threats of produc-
' er strikes in many m:Ik market
ing areas, the Apiculture Depart
ment recently set aside normal
seasonal declines In producer pric
es which had been scheduled to
. take place under federal milk
marketing orders. '
These orders, which generally
art the pattern for most fluid milk
markets, of the country, are de
signed to stabilise supplies and
prices in the regulated areas. The
department sets minimum prices
which milk distributors must pay
dairymen. But it does not set
retail Drices.
Their orders have followed the
principle that prices should de
crease during the spring and sum
mer season of heavy production
and should Increase during the
(all and winter when production
falls off.
Jttra CeasasssUea
The lower prices In spring and
summer are designed to encour
age greater consumption,- while the
higher prices later in we year are
Intended to encourage dairymen
to produce more.
In suspending the normal spring
summer price decline the depart
ment departed from this pattern.
The Question now Js whether the
department will return to It when
fall arrives.
The department's actio j has
brought sharp criticism from a big
dairy group-the Joint Committee
, of the National Creameries Assn.
and the American Butter Insti
tute. This committee -reflects the
viewpoint of dairymen who for one
reason or another do not have
access to the city fluid milk mark
ets. They must depena on manu
facturers of butter, cheese, dried
milk, ice cream and similar pro
ducts for an outlet. These mark
ets offer much lower prices than
others.
New. TreoMes
In a letter to Secretary of Agri
culture. Benson Just made public,
the committee through (Hit M.
'Reed, Its Washington representa
tivesaid the department's action
in suspending the seasonal price
declines threatened to bring new
troubles to the dairy Industry.
Reed said that in setting fluid
milk pricea at "arbitrarily high"
levels, the department, would stim
ulate production la the fluid mark'
eting -areas beyond consumer
aeedx. Surnlui milk nroduced in
these ami would hm diverted, he!
said, into the production of dairy SPARTON
products which would compete
with products made from milk sup
plied by diarymea denied access
to Um higher-priced fluid mark'
eta
Reed said the department should
not have bowed to the threat of
dairy strikes.
Reed said that In event of a pro
ducer strike against government
set prices, the department should
terminate Its order in the affect
ed area. This would leave it up to
producers and distributors to settle
their differences, with the govern
ment being out of the picture and
not subject to pressure from one
side or the other.
The big question of whether the
department will return to the long
established pricing pattern
must be answered by its officials
In August and September. That is
when ' the spring-summer prices
end.'.
Predaeer Strikes
In making its decision, the de
partment may be faced by new
threats of producer atrikes if it
does not allow higher fall and wint
er prices than are presently sched
uled under the federal orders.
Certainly, any decision bv the
department could be expected to
nave an Influence on the national
elections to be held In Novemb
er. Areas which produce much of
manufacturing milk milk
which Reed sayi the department is
discriminating against Is
produced in such politlcally-lm
portant Midwestern atates at Wis
consin, Minnesota and Iowa.
This area long has been under
the impression that dairymen in
the regulated urban markets have
been getting a much belter deal
out of government dairy pro
grams than have they.
Reed took the view that bv boost
ing the fluid milk prices, the de
partment is "throwing very ef
fective road blocks" in the way of
the dairy Industry's efforts to pro
mote greater consumption. He said
Increased prices lead consumers
to buy less.
The department acknowledged
receipt of Reed's letter but made
no comment other than to say that
what he had to say "should be
helpful" in Its determination of
future pricing policies.
MM
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