Hostname: page-component-78c5997874-8bhkd Total loading time: 0 Render date: 2024-11-15T06:08:09.148Z Has data issue: false hasContentIssue false

The Effects of Alternative Seasonal Price Differentials on Milk Production in New York

Published online by Cambridge University Press:  10 May 2017

Harry M. Kaiser
Affiliation:
Department of Agricultural Economics, Cornell University
Pascal A. Oltenacu
Affiliation:
Department of Animal Science, Cornell University
Terry R. Smith
Affiliation:
Department of Animal Science, Cornell University
Get access

Abstract

Uneven monthly milk production (seasonality) is a major problem to the New York dairy industry. This article estimates expected monthly milk production response to a set of hypothetical seasonal price differentials designed to reduce the degree of seasonality. The analysis is based on a random mail survey and farm record data. The results indicate that a seasonal price differential of $1.12 per cwt. (over three times the current differential) would be necessary to completely balance spring and fall production in New York, based on the perceptions of farmers surveyed. Also, producers with better managerial skills are shown to be able to reduce their seasonality at a significantly lower price differential than less skilled farm managers.

Type
Articles
Copyright
Copyright © 1988 Northeastern Agricultural and Resource Economics Association 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

The authors would like to thank Walter Wasserman and the staff at the New York-New Jersey federal milk marketing order for their valuable assistance and suggestions at all stages of this research and three anonymous reviewers for their useful comments on this article. Primary funding for this research was provided by a research and development grant from the New York Department of Agriculture and Markets. Additional support was provided by Agway Inc., Dairylea Cooperative, and Eastern Milk Producers Cooperative Association Inc.

References

Caine, Richard J.H. and Stonehouse, Peter. “Adjusting the Seasonality of Milk Shipments in Canada: Problems, Economic Impacts and Potential Policies.” Canadian Journal of Agricultural Economics. 31 (November 1983): pp. 331–50.Google Scholar
Hall, Seth C., Oltenacu, Pascal A., and Milligan, Robert A.Returns to Dairy Producers Under Different Seasonal Production Patterns.” A.E. Res 87-27, Department of Agricultural Economics, Cornell University, October 1987.Google Scholar
Kaiser, Harry M.A Primer on Federal Milk Marketing Orders in the United States.” A.E. Ext. 86-15, Department of Agricultural Economics, Cornell University, April 1986.Google Scholar
New York Agricultural Statistics Service. New York Agricultural Statistics 1986. Albany, NY 1987.Google Scholar
New York-New Jersey Milk Marketing Order Administrator's Office. Federal Order No. 2 Statistical Handbook: August 1957–August 1986. New York, 1986.Google Scholar
New York-New Jersey Market Administrator's Office, “The Impact of Selected Seasonal Incentive Plans on the Income of Producers Delivering Milk Under the New York-New Jersey Milk Marketing Order During 1982.” Staff Paper 84-7, New York, October 1984.Google Scholar
Oltenacu, P.A., Smith, T.R., and Kaiser, H.M.Identifying Potential Management Practices Responsible for Seasonal Milk Production in New York State.” Department of Animal Science, Cornell University, 1988.Google Scholar
Prindle, Allen M.Evaluation of the Base-Excess Plan for Leveling Seasonal Milk Production: Case Example of Maryland.” Journal of the Northeastern Agricultural Economics Council. Vol. 9, No. 1 (April 1980): pp. 4750.Google Scholar
Prindle, Allen M. and Livezey, Janet S.Optimal Production Schedules for a Representative Farm Under Alternative Seasonal Milk Pricing Patterns of the Base-Excess Plan.” Journal of the Northeastern Agricultural Economics Council. Vol. 10, No. 1 (April 1981): pp. 2329.Google Scholar
Quinn, William, and Wasserman, Walter. “The Dairyman's Guide to Milk Marketing.” A E. Ext. 83-19, Department of Agricultural Economics, Cornell University, September 1983.Google Scholar
Smith, T.R., Oltenacu, P.A., and Kaiser, H.M.Herd Management Factors Affecting Milk Seasonality Over Time.” Department of Animal Science, Cornell University, 1988.Google Scholar