price differential offered to producers 

 on local markets in Maine, New 

 Hampshire, and Vermont placed the 

 dealer in a favorable position for 

 switching to tank, as producers pre- 

 ferred to retain the local price ad- 

 vantage. In Maine, 45 percent of the 

 producers changing to a bulk tank 

 were able to retain a local price ad- 

 vantage which they would have lost 

 by continuing to use cans and hav- 

 ing to switch to Massachusetts out- 

 lets. In Vermont and New Hampshire, 

 the percentages were 19 and 10. In 

 Vermont, 15 percent of the producers 

 who changed, and in Maine 5 per 

 cent of them, were paid a premium by 

 the dealer for bulk milk as compared 

 to what they had been getting for 

 milk in cans. Seventeen percent of 

 the producers in Vermont making the 

 change-over entered into group pur- 

 chase plans in buying their farm 

 tanks, thus holding down somewhat 

 the cost of the equipment. 



Lack of alternative markets un- 

 doubtedly encouraged compliance 

 with a dealer's change-over deadline. 

 There was an occasion, however, 

 when a number of producers ship- 

 ping to a plant organized their own 

 route and sold to a dealer willing 

 to accept milk in cans. In such a 

 case the transition has been delayed 

 until such time as producers have 

 been convinced of the economic ad- 

 vantages of tanks. Such factors as 

 equipment dealer services, enterpris- 

 ing salesmanship or the satisfaction 

 of community leaders with their tanks 

 will do much to influence local opin- 



ion while eliminating the resentment 

 created by a milk dealer deadline. 



2. Size of Tank 



Choice of the right size of tank 

 is important for minimizing costs to 

 the producer. 1 This decision becomes 

 more difficult if the seasonality of 

 production is high. In general, pro- 

 ducers have based their estimates for 

 tank size on the peak production 

 period with every-other-day delivery. 

 This means a tank large enough to 

 hold twice their maximum daily pro- 

 duction. If there is a big range in 

 production from low to high months, 

 many farmers may have tanks with 

 unused capacity for several months of 

 the year. Some estimate of future re- 

 quirements based on an expansion of 

 herd size was apparently not com- 

 mon in the initial establishment of 

 tank size. 



3. Type of Tank 



The two major types of farm tanks 

 in use are direct expansion and ice 

 bank. The choice of type has de- 

 pended on individual preferences for 

 the respective advantages and local 

 electric power company require- 

 ments. 2 



Seventy-one percent of producers 

 in Maine, had direct expansion tanks, 

 62 percent in New Hampshire and 

 69 percent in Vermont. Only 11 per 

 cent of the interviewed farmers with 

 tanks had subsequently found the 

 size of the tank inadequate; but most 

 of them had acquired their tanks 

 rather recently. 



1 See Tank Truck Assembly of Milk in New Hampshire. Agr. Exp. Sta. Bull. 410, 

 March 1954. 



2 The direct expansion equipment is more conducive to peaks in electricity con- 

 sumption than is the ice bank type. Hence at least one local power co-operative makes 

 a demand charge for the use of a direct expansion farm tank — a flat monthly fee, 

 based upon the rated horsepower of the motor, in addition to the monthly charge 

 based on the amount of electricity used. This co-op assesses no demand charge for 

 the use of the ice bank type of tank. 



17 



