Northeast Interstate Dairy Compact

The Northeast Interstate Dairy Compact is an agreement among the six New England states to support the farm price of milk used for fluid consumption at a higher level than under federally mandated minimum prices in the region. From 1997 until its expiration on September 30, 2001, the Northeast compact required processors in the region to pay dairy farmers at least $16.94/cwt. for farm milk used for fluid consumption. The law allowed membership in the compact to expand to New York, New Jersey, Pennsylvania, Delaware, Maryland and Virginia, if the prospective state was contiguous to a member state, and if the compact was approved by the state legislature of the prospective state and the U.S. Congress. Although many states expressed interest in joining the compact or forming a separate compact, no congressional approval was granted beyond the six New England states, because of strong opposition from Upper Midwest dairy farmers and dairy processors. The dairy compact has been replaced with Milk Income Loss Contract (MILC) payments under the 2002 farm bill (P.L. 107-171, Sec. 1502), which mandates direct federal payments to all participating dairy farmers nationwide when the minimum price for fluid farm milk in the Northeast falls below $16.94 per cwt.