Optimal Production Schedules for a Representative Farm Under Alternative Seasonal Milk Pricing Patterns of the Base-Excess Plan

Abstract

Production of milk under various pricing policies were examined for a representative dairy farm operating under the base-excess plan. Three pricing scenarios were examined to determine calving schedule, milk production, and shadow prices. The period May-July was most profitable, and December-January the least profitable months for calving, under the base-excess program in the Mid-Atlantic Order. The representative producer responded to the pricing policies by shifting production in response to changes in the seasonal patterns of the base and excess prices.