The target price for milk to the producer is based on a calculation made every three months by the Ministry of Agriculture, the Ministry of Finance, the Dairy Board and the representatives of the farmers.
The price to be paid to the producers for each liter of milk is set on a standard level, based on a survey of production costs. Every expense that the dairy producer has, including his personal labor, goes into the calculation.
A breakdown of the target price is given in table # 1.
A sum is added or deducted to / from the above price according to the quality of the milk based on test results determining levels of fat, protein, somatic cell counts, bacteria, acidity, temperature of the raw milk received at the farm, etc..
Please note that this system of the target price paid per liter to the farmer, does not imply that all farmers have the same income correlated to the amount of milk they are allowed to market.
Through efficiency in his dairy farm, including acquisition of his inputs / etc., every farmers will be able to guarantee his optimal income.