Dairy producers are reminded that the Milk Income Loss Contract Extension Program ends on May 17.

The program is available to producers who commercially market milk during the period of Oct. 1, 2005, through Sept. 30, 2007. When enrolling, producers will need to provide production evidence for prior months if requesting payment for those months. Production evidence can be submitted as it is received for future months. Producers need to realize it is their responsibility to provide the production evidence to the Farm Service Agency.

The maximum quantity eligible under the program is 2.4 million pounds per fiscal year, which runs Oct. 1 through Sept. 30.

If there is no payment rate for a month, that production would not count toward the maximum quantity. The best thing to do for farms that will exceed 2.4 million pounds would be to contact the office and ensure that they fully understand the program. It is important for the large operations to select the start month that will be the most beneficial. For the majority of producers, the 2.4 million pound limit is not a factor, thus no need to worry about selecting a start month for the program.

Payment rates are determined for each month in which the Boston Class I milk price is below $16.94. The difference is multiplied by 34 percent to determine the payment rate per hundredweight.

For example, the Boston Class I price for March 2006 is $15.74 per cwt. Subtracting that figure from $16.94 gives you $1.20. Multiplying that number by 0.34 — 34 percent — gives you a payment rate of $0.408 per cwt.

Payment rates which have already been established are as follows:

October 2005: $0.00

November 2005: $0.00

December 2005: $0.0408

January 2006: $0.1054

February 2006: $0.1054

March 2006: $0.408

April 2006: $0.8389Payments will be issued after program regulations have been published and computer software is developed. Best guess on how long that will take — maybe mid-June. We do know that when payments are made they will be disbursed as direct deposit only. If there has been a change to an operation's bank or an account change, now would be a good time to verify and correct. All eligible producers will also need to certify compliance with highly erodible land conservation and wetland conservation provisions.The original program ended Sept. 30, 2005. Due to favorable milk prices, there had not been a payment rate in effect since April 2004. However, the last few months prices paid to producers have substantially dropped. Experts predict low prices through the next several months. The program is an option producers may want to consider enrolling in to help cash flow.Producers who

have questions or need more information can contact the office at 724-482-4800, Ext. 2 or 724-775-2369, Ext. 2.Luke Fritz is executive director of the Butler County Farm Service Agency.