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THE MILK BOARD ANNUAL REPORT For the Year Ended December 31st 1956 British Columbia. Legislative Assembly 1957

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 PROVINCE OF BRITISH COLUMBIA
THE MILK BOARD
ANNUAL REPORT
For the Year Ended December 31st
1956
VICTORIA, B.C.
Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty
1957  To His Honour the Lieutenant-Governor in Council
of the Province of British Columbia.
May it please Your Honour:
Sir,—We have the honour to transmit herewith, in accordance with section 56 of
the " Milk Industry Act," the Eleventh Annual Report of the Milk Board under that Act
for the year ended December 31st, 1956.
THE MILK BOARD.
E. C. Carr, Chairman.
W. J. Anderson, Member.
G. W. Challenger, Member.
Vancouver, B.C., January 25th, 1957.  Eleventh Annual Report of the Milk Board
For the Year Ended December 31st, 1956
This Report of the Milk Board is made in accordance with section 56 of the " Milk
Industry Act" and covers the calendar year ended December 31st, 1956.
Tables giving up-to-date statistical information relative to sale of fresh fluid dairy
products, similar to that given in previous Reports, are appended hereto.
NEW LEGISLATION
Under the provisions of the " Milk Industry Act," passed by the last session of the
Legislature, the regulation of the production, marketing, and distribution of whole milk
for the fluid trade was removed from the provisions of the " Public Utilities Act" and
set up under Part III of the new Act.
AREAS OF PRODUCTION
The " Milk Industry Act " established two areas of production within which orders
of the Board shall apply. These were the Vancouver and the Vancouver Island areas.
The Act provided that other areas within the Province may be defined by Order in Council as areas of production.
MEMBERSHIP OF THE BOARD
Under date of May 17th, His Honour the Administrator in Council was pleased to
order that, pursuant to the provisions of section 33 of the "Milk Industry Act," chapter 28 of the Statutes of British Columbia, 1956, Ernest Cowan Carr, of Vancouver, be
appointed Chairman of the Milk Board, effective May 17th, 1956, and that Walton
James Anderson, Ph.D., of Vancouver, and George W. Challenger, B.S.A., of Sardis,
be appointed as members of the Milk Board, effective May 17th, 1956; and that the
appointments of Fraudena Eaton and Professor Harry Maxwell King, made by Order in
Council No. 1626, approved July 10th, 1951, be rescinded.
BOARD MEETINGS
Twenty-four meetings of the Board were held in its office to deal with matters of
policy and administration. Minutes of these meetings are recorded in the minute-book
of the Board.
In addition, numerous meetings and conferences were held with producers, vendors,
and other interested parties to discuss matters pertaining to the production, supply, distribution, sale, and marketing of milk.
LICENSING
Pursuant to the provisions of the General Regulations of the Board, under the
" Public Utilities Act," licences were issued for a period of twelve months, or portion
thereof, ending on March 31st of the periods in respect of which they are issued. With
the coming into operation of General Order No. 1 of the Milk Board on August 15th,
under the "Milk Industry Act," pursuant to the provisions of section 70 (5) of said-
Act, all licences issued under the " Public Utilities Act" were deemed to have been Z 6
BRITISH COLUMBIA
issued under the "Milk Industry Act."   A summary of all 1955-56 licences issued,
cancelled, and in effect at December 31st follows:—
Area
Class I,
Vendor
Class II,
Jobber
Class III,
Producer-
Vendor
Class TV,
Producer
Vancouver—
23
1
22
13
2
11
1
1
4
4
4
2
2
64
27
37
3,233
483
In effect Decemher 31st, 1956 	
Vancouver Island—
2,750
342
26
In effect December 31st, 1956 _ _	
316
Totals—
36
3
33
5
-
5
68
29
39
3,575
509
In effect December 31st, 1956
3,066
Summary of Class IV Licence Suspensions and Cancellations re Farm Premises and
Quality and Adulteration of Milk, January 1st to December 31st, 1956
Area
Farm
Premises
Mill-
Quality
Adulteration
Vancouver—
Suspended..
Reinstated..
Cancelled..
Under suspension, December 31st..
Vancouver Island—
Suspended  _.
Reinstated	
Cancelled..
Under suspension, December 31st..
Totals-
Suspended
Reinstated
Cancelled
\.an..u.u	
Under suspension, December 31st..
572
81
446
45
18
5
12
1
590
86
458
46
198
150
40
204
152
44
SUMMARY OF APPLICATIONS RECEIVED AND REGULATIONS
AND ORDERS ISSUED
Amendment to General Regulations.—An amendment to the General Regulations
(approved by Order in Council No. 611) was made on March 7th. This amendment
was deemed to have come into force on March 1st and struck out Regulations 12, 13,
and 14.
General Order No. 1.—General Order No. 1 was made and passed on August 15th,
to come into operation on September 1st. This order replaced all general and price
regulations made pursuant to the provisions of the " Public Utilities Act."
General Order No. 2.—General Order No. 2 was made and passed on August 20th.
This order amended the wording of section 24 of General Order No. 1.
General Order No. 3.—General Order No. 3 was made and passed on September
11th, to come into operation on October 1st. This order amended section 16 of General Order No. 1 for the purpose of ensuring that, in relation to prices for Class I qualifying milk, there shall be reasonable protection for producers and consumers when the
supply of and the demand for such milk are out of balance. REPORT OF THE MILK BOARD, 1956
Z 7
General Order No. 4.—General Order No. 4 was made and passed on October 16th.
This order amended General Order No. 1 and came into operation on November 2nd.
It amended section 14, repealed section 24, and substituted therefor a new section 24.
CONCLUSION
Certain provisions of Part III of the " Milk Industry Act " were made effective with
the coming into operation of General Order No. 1. Under these provisions it became
necessary to make changes in the method of establishing producer prices and in the
method of payment of these prices. A summary of how milk prices to producers are
calculated under General Order No. 1, with some explanatory remarks, is appended to
this Report. Z 8
BRITISH COLUMBIA
STATISTICAL TABLES
Table Ia.—Sales, Vancouver Area
Sub
Standard
Mill-
Special
Milk
Chocolate
Drink
Buttermilk
Skim-
milk
standard
Cream
(9%
Butter-fat)
Sour
Cream
(18%
Butter-fat)
Whipping
Cream
(32%
Butter-fat)
Total,
All
Products
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
1947, totals.-
46,017,096
13,433,647
883,314
701,241
843,665
5,990,483
813,716
185,383
68,868,545
1948, totals....
48,126,897
10,414,299
1,101,730
641,395
856,906
5,474,866
744,281
283,474
67,643,848
1949, totals...
49,438,250
9,343,757
1,427,635
655,677
805,339
5,373,205
666,995
344,759
68,055,617
1950, totals...
50,787,158
8,618,249
1,494,081
656,740
978,909
5,154,335
673,749
336,393
68,699,614
1951, totals-.
52,431,898
6,406,479
1,157,901
676,520
1,067,050
4,655,593
586,175
305,907
67,287,523
1952, totals....
52,640,425
5,294,969
781,270
734,489
1,371,057
4,588,862
515,753
323,694
66,250,519
1953, totals—
54,995,537
4,894,773
826,203
821,043
1,381,368
4,640,308
509,446
351,907
68,420,585
1954, totals	
58,224,673
4,336,593
835,221
866,805
1,564,299
4,571,347
525,790
372,839
71,297,567
1955, totals
1956—
January    ..
62,076,800
3,658,624
1,003,771
965,606
1,678,902
4,655,092
486,929
417,025
74,942,749
5,328,878
278,234
84,363
73,739
137,915
385,998
36,878
30,997
6,357,002
February-
5,257,989
268,240
84,580
78,810
139,771
379,246
36,288
32,872
6,277,796
March. 	
5,756,437
286,447
92,937
88,774
157,597
410,810
40,369
37,548
6,870,919
April	
5,440,458
265,900
103,265
103,549
152,641
379,802
38,115
33,773
6,517,503
May 	
5,768,506
267,013
133,390
123,461
166,066
387,713
41,665
39,016
6,926,830
June	
5,663,200
251,418
109,274
104,558
156,539
399,051
44,594
46,032
6,774,666
July 	
5,681,506
238,543
119,590
136,745
146,119
374,939
46,723
40,625
6,784,790
August	
5,991,809
240,737
135,804
127,360
146,499
400,417
47,800
33,489
7,123,915
September-
5,693,131
213,186
126,316
89,174
144,769
377,410
42,034
31,192
6,717,212
October	
6,086,873
220,535
133,941
83,730
153,938
412,302
40,439
36,276
7,168,034
November-
5,853,542
215,214
119,758
76,797
152,433
402,041
39,272
31,506
6,890,563
December...
5,773,175
196,620
94,382
74,032
152,851
419,622
41,966
44,374
6,797,022
Totals..
68,295,504
2,942,087
1,337,600
1,160,729
1,807,138
4,729,351
496,143
437,700
81,206,252
Table Ib.—Sales, Vancouver Island Area
Standard
Special
Chocolate
Butter
Skim-
Substandard
Cream
(9%
Butter-fat)
Table and
Sour
Cream
(18%
Butter-fat)
Whipping
Cream
Total,
All
Products
Milk
Milk
Drink
milk
milk
(32%
Butter-fat)
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
Quarts
1948, totals-.
10,403,590
2,790,591
131,413
57,681
50,767
640,580
154,705
94,326
14,323,653
1949, totals—
10,901,354
2,663,182
227,983
79,084
104,821
649,353
132,673
109,022
14,867,482
1950, totals--.
11,172,670
2,634,493
198,403
75,491
66,651
638,244
128,629
107,141
15,021,722
1951, totals	
11,046,294
2,162,188
193,209
70,252
109,169
572,266
114,075
97,257
14,364,710
1952, totals1 2
11,504,552
2,598,236
166,881
65,009
146,865
601,216
101,157
107,426
15,291,342
1953, totals	
12,365,547
2,661,500
153,848
80,286
190,937
640,143
97,840
120,173
16,310,274
1954, totals3-.
13,737,064
2,553,361
147,207
99,783
251,054
666,075
94,498
137,534
17,686,576
1955, totals
1956—
January-
14,583,125
2,347,012
156,365
120,804
286,252
684,998
91,500
144,391
18,414,447
1,242,480
187,608
13,054
8,061
23,146
53,351
6,186
9,609
1,543,495
February	
1,167,653
184,951
12,624
8,273
24,125
54,336
6,226
9,376
1,467,564
March	
1,278,835
195,871
13,232
9,078
26,863
60,072
6,963
11,540
1,602,454
April	
1,219,834
176,369
13,144
10,199
26,336
53,061
5,972
10,403
1,515,318
1,297,614
185,768
15,423
11,343
27,279
56,551
5,842
11,820
1,611,640
1,261,800
179,823
13,361
11,014
26,158
59,248
7,050
18,758
1,577,212
July	
1,308,599
177,939
12,030
11,620
24,275
60,107
7,370
15,409
1,617,349
August.   —
1,351,155
167,906
12,144
10,986
24,567
62,518
7,342
12,254
1,648,872
September-
1,298,171
153,927
13,077
8,428
23,441
57,721
6,454
10,804
1,572,023
October	
1,335,460
159,712
14,456
7,801
25,848
59,289
6,244
11,298
1,620,108
November-
1,304,279
150,941
18,844
7,286
23,407
56,846
5,686
10,159
1,577,448
December—
1,284,286
152,140
10,320
6,554
24,839
60,178
6,276
13,284
1,557,877
Totals-
15,350,166
2,072,955
161,709
110,643
300,284
693,278
77,611
144,714
18,911,360
1 Area extended to include Courtenay-Campbell River district in January.
2 Area extended to include Cowichan Lake and Shawnigan Lake districts in November.
:t Area extended to include Parksville-Qualicum district in January. REPORT OF THE MILK BOARD,  1956 Z 9
Table IIa.—Sales, Vancouver Area, 1956 as Compared to 1955
Product
1955, Quarts
1956, Quarts
Increase ( + ) or Decrease ( —)
Quarts
Per Cent
Standard milk—
Retail	
Wholesale	
Total	
Special milk—
Retail	
Wholesale.	
Total	
Chocolate drink—
Retail	
Wholesale	
Total —	
Buttermilk—
Retail	
Wholesale	
Total 	
Skim-milk—■
Retail	
Wholesale-
Total	
Substandard cream-
Retail	
Wholesale.
Total	
Table and sour cream—■
Retail 	
Wholesale-
Total	
Whipping cream—
Retail	
Wholesale-
Total 	
Total sales (quarts)-
Retail	
Wholesale	
Total	
Total sales (units)—
Retail	
Wholesale-
Total	
498,360
578,440
.076,800
.934,019
724,605
,658,624
280,183
723,588
1,003,771
282,163
683,443
965,606
139,954
538,948
678,902
519,194
135,898
655,092
126,294
360,635
486,929
106,341
310,684
417,025
886,508
056,241
942,749
316,289
827,464
143,753
37,082,419
31,213,085
68,295,504
2,414,812
527,275
2,942,087
376,116
961,484
1,337,600
291,535
869,194
1,160,729
1,265,935
541,203
1,807,138
1,520,392
3,208,959
4,729,351
119,471
376,672
496,143
96,532
341,168
437,700
43,167,212
38,039,040
81,206,252
45,528,677
44,083,855
89,612,532
4-584,059
+5,634,645
4-6,218,704
—519,207
— 197,330
—716,537
4-95,933
+237,896
+ 333,829
+9,372
+ 185,751
+ 195,123
+ 125,981
+2,255
+ 128,236
+ 1,198
+73,061
+74,259
—6,823
+ 16,037
+9,214
-9,809
+30,484
+20,675
+280,704
+5,982,799
+6,263,503
+212,388
+6,256,391
+ 6,468,779
1.60
22.03
10.02
17.69
27.23
19.58
34.24
32.88
33.26
3.32
27.18
20.21
11.05
0.42
7.64
0.08
2.33
1.60
5.40
4.45
1.89
7.76
9.81
4.96
0.65
18.66
8.36
0.47
16.54
7.78
Units calculated on following basis:
All milks and milk products.	
Substandard cream 	
Table and sour cream-
Whipping cream	
1 quart= 1 unit
1 quart=-2 units
1 quart=4 units
1 quart=6 units Z 10 BRITISH COLUMBIA
Table IIb.—Sales, Vancouver Island Area, 1956 as Compared to 1955
Product
Standard milk—
Retail	
Wholesale-
Total 	
Special milk—
Retail	
Wholesale	
Total	
Chocolate drink-
Retail	
Wholesale-
Total	
Buttermilk-
Retail-
Wholesale..
Total	
Skim-milk—
Retail.	
Wholesale-
Total	
Substandard cream—
Retail	
Wholesale-
Total	
Table cream-
Retail	
Wholesale ..
Total	
Whipping cream-
Retail	
Wholesale-
Total	
Total sales (quarts)—
Retail	
Wholesale-
Total	
Total sales (units)-
Retail i	
Wholesale-
Total	
1955, Quarts
1956, Quarts
12,
5
18,
13,
6,
20.
,098,520
,484,605
,583,125
.117,856
229,156
,347,012
56,277
100,088
156,365
61,212
59,592
120,804
228,899
57,353
286,252
263,178
421,820
684,998
31,601
59,899
91,500
52,683
91,708
144,391
910,226
504,221
414,447
531,622
564,278
095,900
10,285,918
5,064,248
15,350,166
1,885,009
187,946
2,072,955
65,094
96,615
161,709
56,045
54,598
110,643
238,706
61,578
300,284
269,722
423,556
693,278
29,774
47,837
77,611
52,331
92,383
144,714
12,882,599
6,028,761
18,911,360
13,503,298
7,057,743
20,561,041
Increase (+) or Decrease (— )
Quarts
+ 187,398
+579,643
+767,041
—232,847
—41,210
—274,057
+ 8,817
—3,473
+5,344
—5,167
—4,994
— 10,161
+9,807
+4,225
+ 14,032
+6,544
+ 1,736
+8,280
— 1,827
— 12,062
— 13,889
—352
+675
+323
—27,627
+524,540
+496,913
—28,324
+493,465
+465,141
Per Cent
1.86
12.93
5.26
10.99
17.98
11.68
15.67
3.47
3.42
8.44
8.38
8.41
4.28
7.37
4.90
2.49
0.41
1.21
5.78
20.14
15.18
0.67
0.74
0.22
0.21
9.53
2.70
0.21
7.52
2.31 REPORT OF THE MILK BOARD,  1956
Z 11
Table IIIa.—Qualifying Milk Supplied by Licensed Producers,
Vancouver Area, 1956
Month
Total
(Pounds)
Class I
Pounds
Per Cent
Secondary
Pounds
Per Cent
January—
February-
March	
April	
May	
June	
July-
August	
September-
October	
November.
December...
Totals-
29,815
28,581
33,443
33,172
39,424
36,073
35,968
32,938
26,222
26,167
25,568
27,557,
607
,818
.,560
,669
,790
,829
,388
,228
,708
,511
,433
,090
17,113,080
57.40
17,028,873
59.58
17,998,694
53.82
17,413,644
52.49
17,994,074
45.64
17,798,967
49.34
18,569,489
51.63
19,285,412
58.55
18,071,766
68.92
19,418,036
74.21
18,626,693
72.85
18,012,464
65.36
374,934,665  |  217,331,192
57.97
12,702,527
42.60
11,552,945
40.42
15,444,866
46.18
15,759,025
47.51
21,430,716
54.36
18,274,862
50.66
17,398,899
48.37
13,652,816
41.45
8,150,942
31.08
6,749,475
25.79
6,941,740
27.15
9,544,626
34.36
157,603,473
42.03
Table IIIb.—Qualifying Milk Supplied by Licensed Producers,
Vancouver Island Area, 1956
Month
Total
(Pounds)
Class I
Pounds
Per Cent
Secondary
Pounds
Per Cent
January....
February-
March	
April	
May.	
June	
July	
August	
September-
October	
November-
December.-
4,598,144
4,192,094
4,570,899
4,466,676
4,942,413
4,614,435
4,713,366
4,701,903
3,884,036
3,992,634
3,914,319
4,317,588
4,323,621
3,879,892
4,448.911
4,177,268
4,499,394
4,412,523
4,443,328
4,494,411
3,610,112
3,733,409
3,705,647
4,051,043
94.03
92.55
97.33
93.52
91.04
95.62
94.27
95.58
92.95
93.51
94.67
93.83
Totals-
52,908,507
49,779,539
94.07
274,523
312,202
121,988
289,408
443,039
201,912
270,038
207,492
273,924
259,225
208,672
266,545
3,128,968
5.97
7.45
2.67
6.48
8.96
4.38
5.73
4.42
7.05
6.49
5.33
6.17
5.91
Table IV.—Pick-up
Prices for Dairy Feeds at Vancouver,
B.C.1
Dec. 31,
1949
Dec. 31,
1950
Dec. 31,
1951
Dec. 31,
1952
Dec. 31,
1953
Dec. 31,
1954
Dec. 31,
1955
Dec. 31,
1956
Bran.         	
Shorts   „	
Wheat (Grade 5)	
Per Ton
$56.00
58.00
69.00
65.00
67.00
55.00
57.00
63.00
89.00
67.00
42.00
29.00
Per Ton
$52.00
54.00
63.00
67.00
69.00
68.00
70.00
67.00
99.00
77.00
47.00
34.00
Per Ton
$67.00
69.00
70.00
72.00
74.00
69.00
71.00
81.00
114.00
56.00
41.00
Per Ton
$48.00
50.00
64.00
60.00
62.00
58.00
60.00
68.00
110.00
82.00
47.00
27.00
Per Ton
$42.00
44.00
64.00
46.00
48.00
51.00
53.00
62.00
98.00
73.00
42.00
24.00
Per Ton
$46.00
48.00
62.00
58.00
60.00
64.00
66.00
64.00
103.00
73.00
48.00
34.00
Per Ton
$54.00
56.00
58.00
58.00
60.00
60.00
62.00
67.00
105.00
73.00
48.00
34.00
Per Ton
$52.00
55.00
65.00
60 00
62.00
Oats  —
64.00
66.00
70.00
93.00
70 00
52.00
41.00
1 Reference: Markets Bulletin, Briti
sh Columt
ia Depart:
nent of A_
riculture. Z 12
BRITISH COLUMBIA
APPENDIX
How Milk Prices to Producers Are Calculated
The "Milk Industry Act" has three key provisions concerning the marketing of
qualifying milk: (1) The Act defines qualifying milk; (2) the Act provides for the
granting of quotas to individual producers; and (3) the Act outlines the method for
establishing accounting values from which one minimum producer price is calculated for
all qualifying quota milk and one for all qualifying non-quota milk.
Qualifying Milk
Qualifying milk is milk which (a) is produced on farm premises approved by the
Live Stock Branch of the Department of Agriculture and (b) conforms to quality
standards as set by regulations under the Act.
Quotas
Quotas are established for each producer and, until February 28th, 1957, are equal
to the average daily production of qualifying milk during the three-month period
November, 1955, December, 1955, and January, 1956. From March 1st, 1957, until
February 28th, 1958, quotas will be the average daily production of qualifying milk
during the four-month period September to December, 1956.
Accounting Values and Minimum Producer Price
The method of arriving at the producer price as provided for in the Act is as follows:
The Milk Board is required to determine accounting values for each class (utilization) of
qualifying milk with butter-fat differentials for variations in butter-fat content, and from
these accounting values the Board is required to determine a minimum producer price
for quota milk calculated by multiplying the amount of quota milk utilized in each class
by the accounting value for that class, adding together the values so obtained and dividing
this total by the total amount of quota milk. The effect of this calculation is equivalent
to arranging that every producer can sell the same percentage of his quota milk as any
other producer in each class of utilization. This provision is a key feature of the new
Act and is important to producers because it guarantees that every producer of qualifying
milk will be subject to the same minimum producer price (adjusted, of course, for
differences in butter-fat content).
Procedure to Arrive at Accounting Values and Producer Price
In carrying out the provisions of the Act, the Board sets accounting values for each
of three classes of qualifying milk: (1) A Class I accounting value which applies to all
milk and cream sold in the fluid form, (2) a Class II accounting value for milk manufactured into evaporated milk, and (3) a Class III accounting value for milk used in any
other way.   These values are announced on the fifth day of the month.
Class I (Fluid) Accounting Value.—The Class I value must be calculated via a
formula which, according to the Act, must take into consideration relevant economic
factors and must include (1) changes in the general price level, (2) changes in the price
of any or all of the factors of production, and (3) the relationship of fluid sales to the
total production of qualifying milk (supply-demand factor). The Board, therefore, has
adopted the following formula for arriving at the accounting value for Class I milk of
4 per cent butter-fat content:—
(a) Base period 1949—53, during which period the average value of 4 per cent
milk was $4.7671 per hundredweight. REPORT OF THE MILK BOARD,  1956
(b) Price indexes: —
Z 13
(l)
Weight
Wholesale Price Index, Canada 	
Index of Wages and Salaries, British Columbia-
Index of Employment, British Columbia	
Index of Price of Local and Alfalfa Hay	
Index of Price of 16% Dairy Feed 	
Index of Wages of Farm Labour-
Index of Commodities and Services used by farmers
(western)    	
Total _ 	
.25
.15
.10
.20
.10
.10
.10
(2)
Nov. 5,
1956
(3)
Index
Multiplied
by Weight
103.5
126.6
102.2
116.9
99.8
113.1
109.4
25.875
18.990
10.220
23.380
9.980
11.310
10.940
110.695
(c) The supply-demand factor provides that when fluid utilization exceeds
52 per cent of the total production of qualifying milk for the most recent
twelve months, 20 cents is added to the value arrived at by the above
calculation, 30 cents is added when utilization exceeds 55 per cent, and
40 cents when it exceeds 57 per cent. Conversely, if fluid utilization is
less than 45, 42, and 40 per cent, 20, 30, and 40 cents are deducted.
As an example, the indexes as at November 5th, 1956, are shown in column (2)
and the indexes weighted and totalled are shown in column (3). Taking the column (3)
total, which is 110.695, and multiplying that total by $4.7671 (the base period value)
gives $5,277. But the fluid utilization of the total production of qualifying milk for the
twelve-month period ended October 31st, 1956, was 55.07 per cent. Thus 30 cents was
added to the above figure and the November accounting value for Class I milk was $5,577.
Class II (Evaporated) and Class HI Accounting Values.—The Class II and Class III
values, according to the Act, are to be determined on the basis of current market yields.
Thus the Board determines the Class II value by adding a differential to the Ontario
producer price of milk used in evaporated milk and the Class III value by adding a differential to the Ontario producer price of milk used in the manufacture of butter and
spray powder. For November, 1956, the Class II and Class III prices per hundredweight
for 4 per cent milk were $3,695 and $2,895 respectively.
The Producer Price.—On the 13th day of the month, the Board announces the
minimum producer price for the preceding month, calculated by the method described
above. The example which follows is an illustration only, and it shows how the producer
price would be calculated from the above accounting values and the actual receipts of
milk by vendors from producers.
■
i Z 14
BRITISH COLUMBIA
(1) Total receipts of qualifying milk-
Total of quotas	
Excess of quotas
10,000,0001b.
7,000,000 lb.
3,000,000 lb.
(2) Utilization of quota milk:—
Class I  5,000,000 lb.
Class II  500,000 lb.
Class III  1,500,000 lb.
Total      7,000,000 lb.
(3) Calculation of minimum producer price for quota milk using
accounting values as calculated:—
Class I:     5,000,000 lb. at $5,577 per cwt  $278,850.00
Class II:       500,000 1b. at   3.695 per cwt       18,475.00
Class III:  1,500,000 lb. at   2.895 per cwt       43,425.00
(4)
.
Total, 7,000,000 lb.   $340,750.00
Minimum producer price for quota milk:—
$340,750.00
 =$4.87 per hundredweight.
7,000,000
Calculation of minimum producer price for qualifying milk in
excess of quota:—
Class II:       750,000 lb. at $3,695 per cwt  $27,712.50
Class III:  2,250,000 lb. at   2.895 per cwt     65,137.50
Total, 3,000,000 lb.
$92,850.00
Minimum producer price for milk in excess of quota:—
$92,850.00
 =$3.10 per hundredweight.
3,000,000
■
Comparison of Results
The system of marketing provided for in the new Act is different than the former
method in the following ways:—
(1) Under the new Act, quotas must be market quotas and are established
without regard to the utilization of a particular producer's milk. The
former system allocated a fluid quota to a producer based upon the fluid
sales of the vendor to whom he shipped.
(2) In contrast to the two minimum producer prices—one for quota and one
for excess milk—now set by the Board, the former system required the
Board to fix a minimum fluid producer price and a minimum manufac-
tured-milk producer price. Thus under the former system the price which
the producer finally received for all his milk depended upon the fluid
sales of the particular vendor to whom he shipped, and, therefore, the
price was not the same to all producers even though the milk was of the
same quality. This unfairness was condemned by the Clyne Commission
and, therefore, has been removed by the provisions of the new Act.
If one wishes to compare the results under the new Act with those under the former
system, a valid comparison may be made by comparing the former minimum producer
price for 4 per cent milk used in the fluid trade (which was $5.38 up to August 31st, REPORT OF THE MILK BOARD, 1956
Z 15
1956) with the present accounting value for Class I milk (which, for November, 1956,
was $5.57). Another valid comparison is between the former minimum producer price
for manufactured milk, which was 56 cents per pound butter-fat ($2.24 per hundredweight for 4 per cent milk), and the present accounting values of $3.69 and $2.89 for
4 per cent milk utilized in Classes II and III respectively. There is no previous counterpart in the former system for the producer prices applicable to every producer provided
for in the new Act. Those producer prices, under the former system, varied according
to the percentage of the milk which a particular vendor sold in the fluid trade. If, for
example, a vendor accepted only sufficient shippers to supply the fluid trade, then those
shippers received nearly $5.38 for 4 per cent milk. But some producers supplying other
vendors were left with a disproportionate share of the manufactured market and their
returns were much less than $5.38. Under the present system the producer price during
the months of September and October was higher than the average price under the former
system. However, there were some producers who did receive less because formerly
they had a disproportionately large share in the fluid market.
Comparison between Three West Coast Areas
November, 1956, accounting values and producer prices per hundredweight for
4 per cent milk are as follows:—
Vancouver
Area
Vancouver
Island Area
Puget Sound
(Seattle) Area
Class I accounting value	
Class II accounting value	
Class III accounting value-
Producer price quota milk-
Producer price excess milk
X  1-UUtU    }Jl iKK.   I.A1.CW  l.-__-_	
Producer weighted average price (combined quota and excess)..
$5,577
3.695
2.895
5.05
2.93
4.83
$6,447
3.695
2.895
6.22
$5,324
3.534
4.90
3.53
4.75
Note.—(1) Utilization of Class I milk in the Vancouver Island area exceeded
75 per cent of the total volume of qualifying milk received. Therefore, the provisions of
General Order No. 1 respecting quotas did not apply for November and the weighted
average price was paid to producers.
(2) Under the Ontario formula for establishing the fluid milk price, the Toronto
price for fluid (Class I) milk for November, 1956, was $4.93 per hundredweight for
4 per cent milk.
VICTORIA, B.C.
Printed by Don McDiarmid, Printer to the Queen's Most Excellent Majesty
1957
460-157-6483 

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