Economic Research Institute Study paper
Utah State University
For the first time in the federal milk order system, the USDA has recommended the use of multiple component pricing in charging handlers for surplus Grade A milk used in manufactured products, and in paying producers for Grade A milk. The recommended plan would price milk on the basis of its protein and butterfat components. Th is would be a change from the historic method of pricing milk per hundredweight at 3.5 percent butterfat, plus a butterfat differential. This recommendation follows a public hearing held March 18-20, 1986, in Salt Lake City, Utah, and would apply to the new "Great Basin" federal milk order under a proposal to merge the present Great Basin and Lake Mead federal orders (USDA). The pricing plan adopted could become a model for inclusion in other federal milk orders.
Christensen, Rondo A.; Lei, Stephen W.; and Major, Dale L., "Economic Feasibility of Assembling Grade A Milk by Protein Content" (1987). Economic Research Institute Study Papers. Paper 460.