The table above indicates that dealers of small and medium size plants 

 are in an unfavorable price position either for buying or selling milk. Part 

 of their problem is that they are purchasing milk from other plants when 

 there is a scarcity of producer milk and selling in periods of surplus. Also 

 the relatively small quantities involved do not make them desirable sources 

 of supply for milk manufacturers. Thus, even under classified pricing they 

 must assume the cost of transportation and handling. 



Information obtained in the Vermont study made in 1954 supports the 

 data in Table 10. McAllister found that in purchasing milk from other dealers 

 ''nearly all of the prices were based on either the Boston Class I price or 

 the state inter-dealer price. About 74 per cent of the (163) dealers used one 

 of those prices as a base, with a handling charge added." 12 



The information obtained on prices supports the finding of the attitude 

 investigation that the purchase of milk from other plants in periods of short- 

 age or the selling of surplus milk to other plants is a more expensive way 

 to balance than by obtaining a uniform supply of milk from producers. It 

 would appear that independent milk dealers can afford to pay substantial 

 premiums to producers who would deliver a uniform supply of milk through- 

 out the year. 



An attempt was made to determine if the 34 dealers who did not want to 

 balance receipts and fluid sales had some factors in common. It appeared 

 that size of plant was associated with a desire to balance or not to balance. 

 A great many small plants were in this unfavorable group. However, examin- 

 ation showed that the method of procurement was probably a more important 

 factor than size, Table 11. 



One half of all these dealers were small producer-dealers. Since most of 

 them used only their own herd's production, their only way of balancing 

 receipts and fluid sales was to regulate their own production. This they were 

 unable to do. 



The larger plants obtained their receipts for the most part from producers 

 or from producers and other dealers. In these cases special circumstances 

 seemed to rule their decision toward balancing. For example, in two plants 



Table 11 Comparison of Size of Plant and Procurement Practices of Dealers 



not Attempting to Balance Receipts and Fluid Sales, 34 Dealers, 



Four Northeastern States, 1956-1957. 



Source 



Size of Plants (daily average sales) 

 Under 1.000 to 2,000 and 



1,000 1.999 over Total 



12 Ibid, McAllister, C. E., Vermont's Milk Dealers, Page 14. 



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