[Federal Register Volume 65, Number 250 (Thursday, December 28, 2000)]
[Rules and Regulations]
[Pages 82832-82842]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-32930]



[[Page 82831]]

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Part III





Department of Agriculture





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Agricultural Marketing Service



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7 CFR Part 1000, et al.



Milk in the Northeast and Other Marketing Areas; Interim Amendment of 
Orders; Interim Rule

  Federal Register / Vol. 65, No. 250 / Thursday, December 28, 2000 / 
Rules and Regulations  

[[Page 82832]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 1000, 1001, 1005, 1006, 1007, 1030, 1032, 1033, 1124, 
1126, 1131, and 1135

[Docket No. AO-14-A69, et al.; DA-00-03]


Milk in the Northeast and Other Marketing Areas; Interim 
Amendment of Orders

------------------------------------------------------------------------
      7 CFR part             Marketing area               AO Nos.
------------------------------------------------------------------------
1001..................  Northeast...............  AO-14-A69.
1005..................  Appalachian.............  AO-388-A11.
1006..................  Florida.................  AO-356-A34.
1007..................  Southeast...............  AO-366-A40.
1030..................  Upper Midwest...........  AO-361-A34.
1032..................  Central.................  AO-313-A43.
1033..................  Mideast.................  AO-166-A67.
1124..................  Pacific Northwest.......  AO-368-A27.
1126..................  Southwest...............  AO-231-A65.
1131..................  Arizona-Las Vegas.......  AO-271-A35.
1135..................  Western.................  AO-380-A17.
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AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim amendment of rules.

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SUMMARY: This interim rule amends, on an emergency basis, the Class III 
and Class IV pricing formulas used in Federal milk orders, effective 
for milk marketed on or after January 1, 2001. The rule thereby 
conforms to the requirements of the Consolidated Appropriations Act, 
2000, which mandated reconsideration of the Class III and Class IV 
pricing formulas included in the final rule for the consolidation and 
reform of Federal milk orders, with amendments to be effective January 
1, 2001.
    This rule reduces the cheese make allowance used in the Class III 
component price calculations, increases the make allowances used in the 
Class IV component price calculations, provides for separate Class III 
and Class IV butterfat prices, and removes the butterfat adjustment 
factor from the protein price formula.
    More than the required number of producers in each of the aforesaid 
marketing areas have approved the issuance of the interim amendments.

EFFECTIVE DATE: January 1, 2001.

FOR FURTHER INFORMATION CONTACT: Constance M. Brenner, Marketing 
Specialist, USDA/AMS/Dairy Programs, Order Formulation Branch, Room 
2971, South Building, P. O. Box 96456, Washington, DC 20090-6456, (202) 
720-2357, e-mail address [email protected].

SUPPLEMENTARY INFORMATION: This administrative rule is governed by the 
provisions of Sections 556 and 557 of Title 5 of the United States Code 
and, therefore, is excluded from the requirements of Executive Order 
12866.
    This interim final rule has been reviewed under Executive Order 
12988, Civil Justice Reform. This rule is not intended to have 
retroactive effect. This rule will not preempt any state or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with the rule.
    The Agricultural Marketing Agreement Act of 1937, as amended (7 
U.S.C. 601-674), provides that administrative proceedings must be 
exhausted before parties may file suit in court. Under section 
608c(15)(A) of the Act, any handler subject to an order may request 
modification or exemption from such order by filing with the Secretary 
a petition stating that the order, any provision of the order, or any 
obligation imposed in connection with the order is not in accordance 
with the law. A handler is afforded the opportunity for a hearing on 
the petition. After a hearing, the Secretary would rule on the 
petition. The Act provides that the District Court of the United States 
in any district in which the handler is an inhabitant, or has its 
principal place of business, has jurisdiction in equity to review the 
Secretary's ruling on the petition, provided a bill in equity is filed 
not later than 20 days after the date of the entry of the ruling.

Small Business Consideration

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.), the Agricultural Marketing 
Service (AMS) considered the economic impact of the changes to the 
Federal milk marketing order program implemented by this interim final 
rule on small entities and prepared a regulatory flexibility analysis 
that was included in the tentative decision (65 FR 76832). The analysis 
indicates that the Department minimized the significant economic 
impacts of the regulations on small entities to the fullest extent 
reasonably possible while adhering to the stated objectives. The 
Department reviewed the regulatory and financial burdens resulting from 
the regulations and determined, to the fullest extent possible, the 
impact on small businesses' abilities to compete in the market place. 
The Department reviewed the regulations from both the small producer 
and small processor perspectives, attempting to maintain a balance 
between these competing interests. Neither small producers nor small 
handlers should experience any particular disadvantage as a result of 
the interim amendments.
    No additional information collection or reporting requirements will 
be necessitated by the amendments.
    An analysis of the economic effects of the alternatives selected 
was done and summarized in the tentative final decision. A complete 
economic analysis is available upon request from Howard McDowell, 
Senior Economist, USDA/AMS/Dairy Programs, Office of the Chief 
Economist, Room 2753, South Building, U.S. Department of Agriculture, 
Washington, DC 20250, (202) 720-7091, e-mail address 
[email protected]

Civil Rights Impact Statement

    Pursuant to Departmental Regulation (DR) 4300-4, a comprehensive 
Civil Rights Impact Analysis (CRIA) was conducted and published with 
the final decision on Federal milk order consolidation and reform. The 
conclusion of that analysis disclosed no potential for affecting dairy 
farmers in protected groups differently than the general population of 
dairy farmers. This issue was reconsidered in the tentative decision 
(65 FR 76832) with regard to the interim amendments, and the conclusion 
has not changed.
    Copies of the Civil Rights Impact Analysis done for the final 
decision on Federal milk order consolidation and reform can be obtained 
from AMS Dairy Programs at (202) 720-4392; any Milk Market 
Administrator office; or via the Internet at: www.ams.usda.gov/dairy/
    Prior documents in this proceeding:
    Notice of Hearing: Issued April 6, 2000; published April 14, 2000 
(65 FR 20094).
    Tentative Final Decision: Issued November 29, 2000; published 
December 7, 2000 (65 FR 76832).

Findings and Determinations

    The findings and determinations hereinafter set forth supplement 
those that were made when the aforesaid orders were first issued and 
when they were amended. The previous findings and determinations are 
hereby ratified and confirmed, except where they may conflict with 
those set forth herein.
    The following findings and determinations are hereby made with 
respect to each of the aforesaid orders:

[[Page 82833]]

    (a) Findings upon the basis of the hearing record. Pursuant to the 
provisions of the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), and the applicable rules of practice and 
procedure governing the formulation of marketing agreements and 
marketing orders (7 CFR Part 900), a public hearing was held upon 
certain proposed amendments to the tentative marketing agreements and 
to the orders regulating the handling of milk in the Northeast and 
other marketing areas.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof it is found that:
    (1) The said orders, as hereby amended on an interim basis, and all 
of the terms and conditions thereof, will tend to effectuate the 
declared policy of the Act;
    (2) The parity prices of milk, as determined pursuant to section 2 
of the Act, are not reasonable in view of the price of feeds, available 
supplies of feeds, and other economic conditions which affect market 
supply and demand for milk in the marketing areas, and the minimum 
prices specified in the orders, as hereby amended, are such prices as 
will reflect the aforesaid factors, insure a sufficient quantity of 
pure and wholesome milk, and be in the public interest; and
    (3) The said orders, as hereby amended on an interim basis, 
regulate the handling of milk in the same manner as, and are applicable 
only to persons in the respective classes of industrial and commercial 
activity specified in, marketing agreements upon which a hearing has 
been held.
    (b) Additional Findings. It is necessary in the public interest to 
make these interim amendments to the Northeast and other orders 
effective January 1, 2001, to meet the requirements of the Consolidated 
Appropriations Act, 2000 (P.L. 106-113, 115 Stat. 1501). Any delay 
beyond that date would tend to disrupt the orderly marketing of milk in 
the aforesaid marketing areas.
    The interim amendments to these orders are known to handlers. The 
tentative final decision containing the proposed amendments to these 
orders was issued on November 29, 2000.
    The changes that result from these interim amendments will not 
require extensive preparation or substantial alteration in the method 
of operation for handlers. In view of the foregoing, it is hereby found 
and determined that good cause exists for making these order amendments 
effective January 1, 2001. It would be contrary to the public interest 
to delay the effective date of these amendments for 30 days after their 
publication in the Federal Register. (Sec. 553(d), Administrative 
Procedure Act, 5 U.S.C. 551-559.)
    (c) Determinations. It is hereby determined that:
    (1) The refusal or failure of handlers (excluding cooperative 
associations specified in Sec. 8c(9) of the Act) of more than 50 
percent of the milk, which is marketed within the specified marketing 
areas, to sign proposed marketing agreements, tends to prevent the 
effectuation of the declared policy of the Act;
    (2) The issuance of this interim order amending the Northeast and 
other orders is the only practical means pursuant to the declared 
policy of the Act of advancing the interests of producers as defined in 
the orders as hereby amended;
    (3) The issuance of the interim order amending the Northeast and 
other orders is favored by at least two-thirds of the producers who 
were engaged in the production of milk for sale in the respective 
marketing areas.

List of Subjects in 7 CFR Parts 1000, 1001, 1005, 1006, 1007, 1030, 
1032, 1033, 1124, 1126, 1131, and 1135

    Milk marketing orders.

Order Relative to Handling

    It is therefore ordered, that on and after the effective date 
hereof, the handling of milk in the Northeast and other marketing areas 
shall be in conformity to and in compliance with the terms and 
conditions of the orders, as amended, and as hereby further amended on 
an interim basis, as follows:
    The authority citation for 7 CFR Parts 1000, 1001, 1005, 1006, 
1007, 1030, 1032, 1033, 1124, 1126, 1131, and 1135 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674, 7253, P.L. 106-113, 115 Stat. 1501.

PART 1000--GENERAL PROVISIONS OF FEDERAL MILK MARKETING ORDERS

    1. Section 1000.40 is amended by removing and reserving paragraph 
(c)(1)(ii) and revising paragraph (d)(1)(i) to read as follows:


Sec. 1000.40  Classes of utilization.

* * * * *
    (c) * * *
    (1) * * *
    (ii) [Reserved]
* * * * *
    (d) * * *
    (1) * * *
    (i) Butter, plastic cream, anhydrous milkfat, and butteroil; and
* * * * *

    2. Section 1000.50 is amended by revising the last sentence of the 
introductory text and paragraphs (a), (b), (c), (g), (h), (j), (l), 
(m), (n), (o), (p)(1), and (q)(3) and adding paragraph (q)(4) to read 
as follows:


Sec. 1000.50  Class prices, component prices, and advanced pricing 
factors.

    * * * The price described in paragraph (d) of this section shall be 
derived from the Class II skim milk price announced on or before the 
23rd day of the month preceding the month to which it applies and the 
Class IV butterfat price announced on or before the 5th day of the 
month following the month to which it applies.
    (a) Class I price. The Class I price per hundredweight shall be the 
adjusted Class I differential specified in Sec. 1000.52 plus the higher 
of the advanced Class III or advanced Class IV prices calculated in 
paragraph (q)(4) of this section.
    (b) Class I skim milk price. The Class I skim milk price per 
hundredweight shall be the adjusted Class I differential specified in 
Sec. 1000.52 plus the advanced Class III or advanced Class IV skim milk 
price used in the calculation of the higher of the advanced Class III 
or advanced Class IV prices calculated in paragraph (q)(4) of this 
section.
    (c) Class I butterfat price. The Class I butterfat price per pound 
shall be the adjusted Class I differential specified in Sec. 1000.52 
divided by 100, plus the advanced Class III or advanced Class IV 
butterfat price used in the calculation of the higher of the advanced 
Class III or advanced Class IV prices calculated in paragraph (q)(4) of 
this section.
* * * * *
    (g) Class II butterfat price. The Class II butterfat price per 
pound shall be the Class IV butterfat price plus $.007.
    (h) Class III price. The Class III price per hundredweight, rounded 
to the nearest cent, shall be .965 times the Class III skim milk price 
plus 3.5 times the Class III butterfat price.
* * * * *
    (j) Class IV price. The Class IV price per hundredweight, rounded 
to the nearest cent, shall be .965 times the Class IV skim milk price 
plus 3.5 times the Class IV butterfat price.
* * * * *
    (l) Class III and Class IV butterfat prices. (1) The Class III 
butterfat price per pound, rounded to the nearest one-hundredth cent, 
shall be computed as follows:
    (i) Compute a weighted average of the following prices:

[[Page 82834]]

    (A) The U.S. average NASS survey price for 40-lb. block cheese 
reported by the Department for the month; and
    (B) The U.S. average NASS survey price for 500-pound barrel cheddar 
cheese (38 percent moisture) reported by the Department for the month 
plus 3 cents;
    (ii) Subtract 16.5 cents from the price computed pursuant to 
paragraph (l)(1)(i) of this section and multiply the result by 1.582;
    (2) The Class IV butterfat price per pound, rounded to the nearest 
one-hundredth cent, shall be the U.S. average NASS AA butter survey 
price reported by the Department for the month less 11.5 cents, with 
the result divided by 0.82.
    (m) Nonfat solids price. The nonfat solids price per pound, rounded 
to the nearest one-hundredth cent, shall be the U.S. average NASS 
nonfat dry milk survey price reported by the Department for the month 
less 14 cents.
    (n) Protein price. The protein price per pound, rounded to the 
nearest one-hundredth cent, shall be computed by subtracting 16.5 cents 
from the price computed pursuant to paragraph (l)(1)(i) of this section 
and multiplying the result by 1.405;
    (o) Other solids price. The other solids price per pound, rounded 
to the nearest one-hundredth cent, shall be the U.S. average NASS dry 
whey survey price reported by the Department for the month minus 14 
cents, with the result divided by 0.968. The other solids price shall 
not be less than zero.
    (p) * * *
    (1) Multiply .0005 by the weighted average price computed pursuant 
to paragraph (l)(1)(i) of this section and round to the 5th decimal 
place;
* * * * *
    (q) * * *
    (3) Calculate the advanced Class III and advanced Class IV 
butterfat prices as follows:
    (i) The advanced Class III butterfat price shall be calculated by 
subtracting 16.5 cents per pound from a weighted average of the 2 most 
recent U.S. average NASS survey prices for 40-lb. block cheese and for 
500-pound barrel cheddar cheese (at 38 percent moisture) plus 3 cents 
announced before the 24th day of the month, with the result multiplied 
by 1.582;
    (ii) The advanced Class IV butterfat price shall be calculated by 
subtracting 11.5 cents from a weighted average of the 2 most recent 
U.S. average NASS AA butter survey prices announced before the 24th day 
of the month, with the result divided by 0.82.
    (4) Calculate the advanced Class III and advanced Class IV prices 
as follows:
    (i) The advanced Class III price shall be the sum of the value 
calculated pursuant to paragraph (q)(1) of this section multiplied by 
.965 plus the value calculated pursuant to paragraph (q)(3)(i) of this 
section multiplied by 3.5, rounded to the nearest cent.
    (ii) The advanced Class IV price shall be the sum of the value 
calculated pursuant to paragraph (q)(2) of this section multiplied by 
.965 plus the value calculated pursuant to paragraph (q)(3)(ii) of this 
section multiplied by 3.5, rounded to the nearest cent.

PART 1001--MILK IN THE NORTHEAST MARKETING AREA

    1. Section 1001.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (h) to read as follows:


Sec. 1001.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (h) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1001.61 is revised to read as follows:


Sec. 1001.61  Computation of producer butterfat price and producer 
price differential.

    For each month, the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight for producer milk receipts. The report 
of any handler who has not made payments required pursuant to 
Sec. 1001.71 for the preceding month shall not be included in the 
computation of these prices, and such handler's report shall not be 
included in the computation for succeeding months until the handler has 
made full payment of outstanding monthly obligations. Subject to the 
aforementioned conditions, the market administrator shall compute the 
producer butterfat price and the producer price differential in the 
following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1001.60(h) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1001.60 for all handlers required to 
file reports prescribed in Sec. 1001.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1001.60(a) through (g) and 
Sec. 1001.60(i) by the protein price, other solids price, and producer 
butterfat price, respectively;
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1001.60(h) by 
the Class III skim milk price and the producer butterfat price, 
respectively;
    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1001.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;
    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:

[[Page 82835]]

    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1001.60(h); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1001.62 is amended by revising paragraphs (e) and (g) to 
read as follows:


Sec. 1001.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (g) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1001.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1001.61(b).
    4. Section 1001.71 is amended by revising paragraphs (b)(2) and (3) 
to read as follows:


Sec. 1001.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively; and
    (3) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1001.60(h) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1001.75 applicable at 
the location of the plant from which received.
    5. Section 1001.73 is amended by revising paragraphs (a)(2)(ii) and 
(b)(3)(vi) to read as follows:


Sec. 1001.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) Multiply the pounds of butterfat received by the producer 
butterfat price for the month;
* * * * *
    (b) * * *
    (3) * * *
    (vi) Multiply the pounds of butterfat in Class III and Class IV 
milk by the respective butterfat prices for the month;
* * * * *

PART 1005--MILK IN THE APPALACHIAN MARKETING AREA

    1. Section 1005.60 is amended by revising paragraph (e) to read as 
follows:


Sec. 1005.60  Handler's value of milk.

* * * * *
    (e) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *
    2. Section 1005.61 is amended by revising paragraphs (a) and (b)(4) 
to read as follows:


Sec. 1005.61  Computation of uniform prices.

* * * * *
    (a) Uniform butterfat price. The uniform butterfat price per pound, 
rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1005.60(e) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) * * *
    (4) Subtract the value of the total pounds of butterfat for all 
handlers. The butterfat value shall be computed by multiplying the sum 
of the pounds of butterfat in producer milk and other source milk used 
to calculate the values in paragraphs (a)(1) and (a)(2) of this section 
by the butterfat price computed in paragraph (a) of this section;
* * * * *

PART 1006--MILK IN THE FLORIDA MARKETING AREA

    1. Section 1006.60 is amended by revising paragraph (e) to read as 
follows:


Sec. 1006.60  Handler's value of milk.

* * * * *
    (e) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order; 
and
* * * * *

    2. Section 1006.61 is amended by revising paragraphs (a) and (b)(4) 
to read as follows:


Sec. 1006.61  Computation of uniform prices.

* * * * *
    (a) Uniform butterfat price. The uniform butterfat price per pound, 
rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1006.60(e) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in

[[Page 82836]]

producer milk and other source milk used to calculate the values in 
paragraphs (a)(1) and (a)(2) of this section.
    (b) * * *
    (4) Subtract the value of the total pounds of butterfat for all 
handlers. The butterfat value shall be computed by multiplying the sum 
of the pounds of butterfat in producer milk and other source milk used 
to calculate the values in paragraphs (a)(1) and (a)(2) of this section 
by the butterfat price computed in paragraph (a) of this section;
* * * * *

PART 1007--MILK IN THE SOUTHEAST MARKETING AREA

    1. Section 1007.60 is amended by revising paragraph (e) to read as 
follows:


Sec. 1007.60  Handler's value of milk.

* * * * *
    (e) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order; 
and
* * * * *

    2. Section 1007.61 is amended by revising paragraphs (a) and (b)(4) 
to read as follows:


Sec. 1007.61  Computation of uniform prices.

* * * * *
    (a) Uniform butterfat price. The uniform butterfat price per pound, 
rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1007.60(e) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) * * *
    (4) Subtract the value of the total pounds of butterfat for all 
handlers. The butterfat value shall be computed by multiplying the sum 
of the pounds of butterfat in producer milk and other source milk used 
to calculate the values in paragraphs (a)(1) and (a)(2) of this section 
by the butterfat price computed in paragraph (a) of this section;
* * * * *

PART 1030--MILK IN THE UPPER MIDWEST MARKETING AREA

    1. Section 1030.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (i) to read as follows:


Sec. 1030.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
    (i) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *
    2. Section 1030.61 is revised to read as follows:


Sec. 1030.61  Computation of producer butterfat price and producer 
price differential.

    For each month the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight for producer milk receipts. The report 
of any handler who has not made payments required pursuant to 
Sec. 1030.71 for the preceding month shall not be included in the 
computation of these prices, and such handler's report shall not be 
included in the computation for succeeding months until the handler has 
made full payment of outstanding monthly obligations. Subject to the 
conditions of this paragraph, the market administrator shall compute 
the producer butterfat price and the producer price differential in the 
following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1030.60(i) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1030.60 for all handlers required to 
file reports prescribed in Sec. 1030.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1030.60(a) through (h) and 
Sec. 1030.60(j) by the protein price, other solids price, and producer 
butterfat price, respectively, and the total value of the somatic cell 
adjustment pursuant to Sec. 1030.30(a)(1) and (c)(1);
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1030.60(i) by 
the Class III skim milk price and the producer butterfat price, 
respectively;

[[Page 82837]]

    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1030.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;
    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1030.60(i); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1030.62 is amended by revising paragraphs (e) and (h) to 
read as follows:


Sec. 1030.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (h) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1030.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1030.61(b).

    4. Section 1030.71 is amended by revising paragraphs (b)(2) and 
(b)(4) to read as follows:


Sec. 1030.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively;
* * * * *
    (4) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1030.60(i) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1030.75 applicable at 
the location of the plant from which received.

    5. Section 1030.73 is amended by revising paragraphs (a)(2)(ii), 
(c)(2)(v), and (c)(3)(ii) to read as follows:


Sec. 1030.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *
    (c) * * *
    (2) * * *
    (v) The pounds of butterfat in Class III and Class IV milk by the 
respective butterfat prices for the month;
* * * * *
    (3) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;

PART 1032--MILK IN THE CENTRAL MARKETING AREA

    1. Section 1032.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (i) to read as follows:


Sec. 1032.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (i) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1032.61 is revised to read as follows:


Sec. 1032.61  Computation of producer butterfat price and producer 
price differential.

    For each month the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight for producer milk receipts. The report 
of any handler who has not made payments required pursuant to 
Sec. 1032.71 for the preceding month shall not be included in the 
computation of these prices, and such handler's report shall not be 
included in the computation for succeeding months until the handler has 
made full payment of outstanding monthly obligations. Subject to the 
conditions of this paragraph, the market administrator shall compute 
the producer butterfat price and the producer price differential in the 
following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1032.60(i) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1032.60 for all handlers required to 
file reports prescribed in Sec. 1032.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1032.60(a) through (h) and 
Sec. 1032.60(j) by the protein price, other solids price, and producer 
butterfat price, respectively, and the total value of the somatic cell 
adjustment pursuant to Sec. 1032.30(a)(1) and (c)(1);
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1032.60(i) by 
the Class III skim milk price and the producer butterfat price, 
respectively;

[[Page 82838]]

    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1032.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;
    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1032.60(i); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1032.62 is amended by revising paragraphs (e) and (h) to 
read as follows:


Sec. 1032.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (h) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1032.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1032.61(b).

    4. Section 1032.71 is amended by revising paragraphs (b)(2) and (4) 
to read as follows:


Sec. 1032.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively;
* * * * *
    (4) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1032.60(i) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1032.75 applicable at 
the location of the plant from which received.

    5. Section 1032.73 is amended by revising paragraphs (a)(2)(ii), 
(c)(2)(v), and (c)(3)(ii) to read as follows:


Sec. 1032.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *
    (c) * * *
    (2) * * *
    (v) The pounds of butterfat in Class III and Class IV milk by the 
respective butterfat prices for the month;
* * * * *
    (3) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *

PART 1033--MILK IN THE MIDEAST MARKETING AREA

    1. Section 1033.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (i) to read as follows:


Sec. 1033.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (i) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1033.61 is revised to read as follows:


Sec. 1033.61  Computation of producer butterfat price and producer 
price differential.

    For each month the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight for producer milk receipts. The report 
of any handler who has not made payments required pursuant to 
Sec. 1033.71 for the preceding month shall not be included in the 
computation of these prices, and such handler's report shall not be 
included in the computation for succeeding months until the handler has 
made full payment of outstanding monthly obligations. Subject to the 
conditions of this paragraph, the market administrator shall compute 
the producer butterfat price and the producer price differential in the 
following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1033.60(i) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1033.60 for all handlers required to 
file reports prescribed in Sec. 1033.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1033.60(a) through (h) and 
Sec. 1033.60(j) by the protein price, other solids price, and producer 
butterfat price, respectively, and the total value of the somatic cell 
adjustment pursuant to Sec. 1033.30(a)(1) and (c)(1);
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1033.60(i) by 
the Class III skim milk price and the producer butterfat price, 
respectively;

[[Page 82839]]

    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1033.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;
    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1033.60(i); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1033.62 is amended by revising paragraphs (e) and (h) to 
read as follows:


Sec. 1033.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (h) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1033.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1033.61(b).
    4. Section 1033.71 is amended by revising paragraphs (b)(2) and (4) 
to read as follows:


Sec. 1033.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively;
* * * * *
    (4) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1033.60(i) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1033.75 applicable at 
the location of the plant from which received.

    5. Section 1033.73 is amended by revising paragraphs (a)(2)(ii) and 
(b)(3)(v) to read as follows:


Sec. 1033.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *
    (b) * * *
    (3) * * *
    (v) The pounds of butterfat in Class III and Class IV milk by the 
respective butterfat prices for the month;
* * * * *

PART 1124--MILK IN THE PACIFIC NORTHWEST MARKETING AREA

    1. Section 1124.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (h) to read as follows:


Sec. 1124.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (h) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1124.61 is revised to read as follows:


Sec. 1124.61  Computation of producer butterfat price and producer 
price differential.

    For each month, the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight. The report of any handler who has not 
made payments required pursuant to Sec. 1124.71 for the preceding month 
shall not be included in these computations, and such handler's report 
shall not be included in the computation for succeeding months until 
the handler has made full payment of outstanding monthly obligations. 
Subject to the aforementioned conditions, the market administrator 
shall compute the producer butterfat price and the producer price 
differential in the following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1124.60(h) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1124.60 for all handlers required to 
file reports prescribed in Sec. 1124.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1124.60(a) through (g) and 
Sec. 1124.60(i) by the protein price, other solids price, and producer 
butterfat price, respectively;
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1124.60(h) by 
the Class III skim milk price and the producer butterfat price, 
respectively;
    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1124.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;

[[Page 82840]]

    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1124.60(h); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1124.62 is amended by revising paragraphs (e) and (g) to 
read as follows:


Sec. 1124.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (g) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1124.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1124.61(b).

    4. Section 1124.71 is amended by revising paragraphs (b)(2) and (3) 
to read as follows:


Sec. 1124.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively; and
    (3) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1124.60(h) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1124.75 applicable at 
the location of the plant from which received.

    5. Section 1124.73 is amended by revising paragraphs (a)(2)(ii), 
(c)(2)(v), and (c)(3)(ii) to read as follows:


Sec. 1124.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *
    (c) * * *
    (2) * * *
    (v) The pounds of butterfat in Class III and Class IV milk by the 
respective butterfat prices for the month;
* * * * *
    (3) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *

PART 1126--MILK IN THE SOUTHWEST MARKETING AREA

    1. Section 1126.60 is amended by revising paragraphs (c)(3), 
(d)(2), and (i) to read as follows:


Sec. 1126.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (i) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1126.61 is revised to read as follows:


Sec. 1126.61  Computation of producer butterfat price and producer 
price differential.

    For each month, the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight. The report of any handler who has not 
made payments required pursuant to Sec. 1126.71 for the preceding month 
shall not be included in these computations, and such handler's report 
shall not be included in the computation for succeeding months until 
the handler has made full payment of outstanding monthly obligations. 
Subject to the aforementioned conditions, the market administrator 
shall compute the producer butterfat price and the producer price 
differential in the following manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1126.60(i) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1126.60 for all handlers required to 
file reports prescribed in Sec. 1126.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1126.60(a) through (h) and 
Sec. 1126.60(j) by the protein price, other solids price, and producer 
butterfat price, respectively, and the total value of the somatic cell 
adjustment pursuant to Sec. 1126.30(a)(1) and (c)(1);
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1126.60(i) by 
the Class III skim milk price and the producer butterfat price, 
respectively;
    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1126.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;

[[Page 82841]]

    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1126.60(i); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1126.62 is amended by revising paragraphs (e) and (h) to 
read as follows:


Sec. 1126.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (h) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1126.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1126.61(b).

    4. Section 1126.71 is amended by revising paragraphs (b)(2) and (4) 
to read as follows:


Sec. 1126.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively;
* * * * *
    (4) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1126.60(i) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1126.75 applicable at 
the location of the plant from which received.

    5. Section 1126.73 is amended by revising paragraphs (a)(2)(ii) and 
(b)(3)(v) to read as follows:


Sec. 1126.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) Multiply the pounds of butterfat received times the producer 
butterfat price for the month;
* * * * *
    (b) * * *
    (3) * * *
    (v) The pounds of butterfat in Class III and Class IV milk by the 
respective butterfat prices for the month;
* * * * *

PART 1131--MILK IN THE ARIZONA-LAS VEGAS MARKETING AREA

    1. Section 1131.60 is amended by revising paragraph (e) to read as 
follows:


Sec. 1131.60  Handler's value of milk.

* * * * *
    (e) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1131.61 is amended by revising paragraphs (a) and (b)(4) 
to read as follows:


Sec. 1131.61  Computation of uniform prices.

* * * * *
    (a) Uniform butterfat price. The uniform butterfat price per pound, 
rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1131.60(e) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) * * *
    (4) Subtract the value of the total pounds of butterfat for all 
handlers. The butterfat value shall be computed by multiplying the sum 
of the pounds of butterfat in producer milk and other source milk used 
to calculate the values in paragraphs (a)(1) and (a)(2) of this section 
by the butterfat price computed in paragraph (a) of this section;
* * * * *

PART 1135--MILK IN THE WESTERN MARKETING AREA

    1. Section 1135.60 is amended by revising paragraphs (c)(3), (d)(2) 
and (h) to read as follows:


Sec. 1135.60  Handler's value of milk.

* * * * *
    (c) * * *
    (3) Add an amount obtained by multiplying the pounds of butterfat 
in Class III by the Class III butterfat price.
    (d) * * *
    (2) Add an amount obtained by multiplying the pounds of butterfat 
in Class IV by the Class IV butterfat price.
* * * * *
    (h) Multiply the Class I skim milk and Class I butterfat prices 
applicable at the location of the nearest unregulated supply plants 
from which an equivalent volume was received by the pounds of skim milk 
and butterfat in receipts of concentrated fluid milk products assigned 
to Class I pursuant to Sec. 1000.43(d) and Sec. 1000.44(a)(3)(i) and 
the corresponding step of Sec. 1000.44(b) and the pounds of skim milk 
and butterfat subtracted from Class I pursuant to Sec. 1000.44(a)(8) 
and the corresponding step of Sec. 1000.44(b), excluding such skim milk 
and butterfat in receipts of fluid milk products from an unregulated 
supply plant to the extent that an equivalent amount of skim milk or 
butterfat disposed of to such plant by handlers fully regulated under 
any Federal milk order is classified and priced as Class I milk and is 
not used as an offset for any other payment obligation under any order.
* * * * *

    2. Section 1135.61 is revised to read as follows:


Sec. 1135.61  Computation of producer butterfat price and producer 
price differential.

    For each month, the market administrator shall compute a producer 
butterfat price per pound of butterfat and a producer price 
differential per hundredweight. The report of any

[[Page 82842]]

handler who has not made payments required pursuant to Sec. 1135.71 for 
the preceding month shall not be included in these computations, and 
such handler's report shall not be included in the computation for 
succeeding months until the handler has made full payment of 
outstanding monthly obligations. Subject to the conditions of this 
paragraph, the market administrator shall compute the producer 
butterfat price and the producer price differential in the following 
manner:
    (a) Producer butterfat price. The producer butterfat price per 
pound, rounded to the nearest one-hundredth cent, shall be computed by:
    (1) Multiplying the pounds of butterfat in producer milk allocated 
to each class pursuant to Sec. 1000.44(b) by the respective class 
butterfat prices;
    (2) Adding the butterfat value calculated in Sec. 1135.60(h) for 
other source milk allocated to Class I pursuant to Sec. 1000.43(d) and 
the steps of Sec. 1000.44(b) that correspond to Sec. 1000.44(a)(3)(i) 
and Sec. 1000.44(a)(8) by the Class I price; and
    (3) Dividing the sum of paragraphs (a)(1) and (a)(2) of this 
section by the sum of the pounds of butterfat in producer milk and 
other source milk used to calculate the values in paragraphs (a)(1) and 
(a)(2) of this section.
    (b) Producer price differential. (1) Combine into one total the 
values computed pursuant to Sec. 1135.60 for all handlers required to 
file reports prescribed in Sec. 1135.30;
    (2) Subtract the total of the values obtained:
    (i) By multiplying the total pounds of protein, other solids, and 
butterfat contained in each handler's producer milk for which an 
obligation was computed pursuant to Sec. 1135.60(a) through (g) and 
Sec. 1135.60(i) by the protein price, other solids price, and producer 
butterfat price, respectively;
    (ii) By multiplying each handler's pounds of skim milk and 
butterfat for which a value is computed pursuant to Sec. 1135.60(h) by 
the Class III skim milk price and the producer butterfat price, 
respectively;
    (3) Add an amount equal to the minus location adjustments and 
subtract an amount equal to the plus location adjustments computed 
pursuant to Sec. 1135.75;
    (4) Add an amount equal to not less than one-half of the 
unobligated balance in the producer-settlement fund;
    (5) Divide the resulting amount by the sum of the following for all 
handlers included in these computations:
    (i) The total hundredweight of producer milk; and
    (ii) The total hundredweight for which a value is computed pursuant 
to Sec. 1135.60(h); and
    (6) Subtract not less than 4 cents nor more than 5 cents from the 
price computed pursuant to paragraph (b)(5) of this section. The result 
shall be known as the producer price differential for the month.

    3. Section 1135.62 is amended by revising paragraphs (e) and (g) to 
read as follows:


Sec. 1135.62  Announcement of producer prices.

* * * * *
    (e) The producer butterfat price;
* * * * *
    (g) The statistical uniform price computed by adding the following 
values:
    (1) The Class III skim milk price computed in Sec. 1000.50(i) 
multiplied by .965;
    (2) The producer butterfat price computed in Sec. 1135.61(a) 
multiplied by 3.5; and
    (3) The producer price differential computed in Sec. 1135.61(b).
* * * * *

    4. Section 1135.71 is amended by revising paragraph (b)(2) and 
adding paragraph (b)(3) to read as follows:


Sec. 1135.71  Payments to the producer-settlement fund.

* * * * *
    (b) * * *
    (2) An amount obtained by multiplying the total pounds of protein, 
other solids, and butterfat contained in producer milk by the protein, 
other solids, and producer butterfat prices respectively;
    (3) An amount obtained by multiplying the hundredweight, the pounds 
of skim milk, and the pounds of butterfat for which a value was 
computed pursuant to Sec. 1135.60(h) by the producer price 
differential, the Class III skim milk price, and the producer butterfat 
price, respectively, as adjusted pursuant to Sec. 1135.75 applicable at 
the location of the plant from which received; and
* * * * *

    5. Section 1135.73 is amended by revising paragraphs (a)(2)(ii) and 
(b)(3)(v) to read as follows:


Sec. 1135.73  Payments to producers and to cooperative associations.

    (a) * * *
    (2) * * *
    (ii) The pounds of butterfat received times the producer butterfat 
price for the month;
* * * * *
    (b) * * *
    (3) * * *
    (v) The pounds of butterfat in Class III and Class IV milk times 
the respective butterfat prices for the month;

    Dated: December 21, 2000.
Enrique E. Figueroa,
Deputy Under Secretary, Marketing and Regulatory Programs.
[FR Doc. 00-32930 Filed 12-27-00; 8:45 am]
BILLING CODE 3410-02-P