(1) The skim milk or butterfat so assigned to either class shall be limited to the amount thereof remaining in such class in the transferee plant after computations pursuant to § 1062.46 (a) (8) and the corresponding step of

§ 1062.46(b);

(2) If the transferor plant received during the month other source milk to be allocated pursuant to § 1062.46 (a) (3) and the corresponding step of § 1062.46 (b), the skim milk and butterfat so transferred or diverted shall be classified so as to allocate the least possible Class I utilization to such other source milk; and

(3) If the handler transferring to the pool plant of another handler received during the month other source milk to be allocated pursuant to § 1062.46(a) (7) and (8) and the corresponding steps of § 1062.46(b), the skim milk and butterfat so transferred or diverted up to the total of such receipts shall not be classified as Class I milk to a greater extent than would be applicable to a like quantity of such other source milk received at the transferee plant;

(b) As Class I milk, if transferred from a pool plant to a producer-handler under this or any other order or transferred or diverted to a plant exempt pursuant to § 1062.60 (b);

(c) As Class I milk, if transferred in bulk or diverted to a nonpool plant that is neither an other order plant nor a producer-handler plant, located more than 350 miles, by the shortest highway distance as determined by the market administrator, from the City Hall, St. Louis, Mo., except that cream so transferred may be classified as Class II milk if prior written notice is given to the market administrator and each container is labeled by the transferor as "nonGrade A❞ cream for manufacturing only;

(d) As Class I milk, if transferred or diverted in bulk to a nonpool plant that is neither an other order plant nor a producer-handler plant, located not more than 350 miles, by the shortest highway distance as determined by the market administrator, from the City Hall, St. Louis, Mo., unless the requirements of subparagraphs (1) and (2) of this paragraph are met, in which case the skim milk and butterfat so transferred or diverted shall be classified in accordance with the assignment resulting from subparagraph (3) of this paragraph:

(1) The transferring or diverting handler claims classification pursuant to

73

the assignment set forth in subparagraph (3) of this paragraph in his report submitted to the market administrator pursuant to § 1062.30 for the month within which such transaction occurred;

(2) The operator of such nonpool plant maintains books and records showing the utilization of all skim milk and butterfat received at such plant which are made available if requested by the market administrator for the purpose of verification; and

(3) The skim milk and butterfat so transferred or diverted shall be classified on the basis of the following assignment of utilization at such nonpool plant in excess of receipts of packaged fluid milk products from all pool plants and other order plants:

(i) Any Class I milk utilization disposed of on routes in the marketing area shall be first assigned to the skim milk and butterfat in the fluid milk products so transferred or diverted from pool plants, next pro rata to receipts from other order plants and thereafter to receipts from dairy farmers who the market administrator determines constitute regular sources of supply of Grade A milk for such nonpool plant;

(ii) Any Class I milk utilization disposed of on routes in the marketing area of another order issued pursuant to the Act shall be first assigned to receipts from plants fully regulated by such order, next pro rata to receipts from pool plants and other order plants not regulated by such order, and thereafter to receipts from dairy farmers who the market administrator determines constitute regular sources of supply for such nonpool plant;

(iii) Class I milk utilization in excess of that assigned pursuant to subdivisions (i) and (ii) of this subparagraph shall be assigned first to remaining receipts from dairy farmers who the market administrator determines constitute the regular source of supply for such nonpool plant and Class I milk utilization in excess of such receipts shall be assigned pro rata to unassigned receipts at such nonpool plant from all pool and other order plants; and

(iv) To the extent that Class I milk utilization is not so assigned to it, the skim milk and butterfat so transferred or diverted shall be classified as Class II milk; and

(v) If any skim milk or butterfat is transferred to a second nonpool plant

under this paragraph the same conditions of audit, classification, and allocation shall apply; and

(e) As follows, if transferred or diverted to an other order plant in excess of receipts from such plant in the same category as described in subparagraph (1), (2), or (3) of this paragraph:

(1) If transferred in packaged form, classification shall be in the classes to which allocated as a fluid milk product under the other order;

(2) If transferred or diverted in bulk form, classification shall be in the classes to which allocated as a fluid milk product under the other order (including allocation under conditions set forth in subparagraph (3) of this paragraph);

(3) If the operators of both the transferor and transferee plants so request in the reports of receipts and utilization filed with their respective market administrators, transfers or diversions in bulk form shall be classified as Class II milk to the extent of the Class 11 milk utilization (or comparable utilization under such other order) available for such assignment pursuant to the allocation provisions of the transferee order;

(4) If information concerning the classification to which allocated under the other order is not available to the market administrator for purposes of establishing classification pursuant to this paragraph, classification shall be as Class I milk subject to adjustment when such information is available;

(5) For purposes of this paragraph (e), if the transferee order provides for more than two classes of utilization, skim milk and butterfat allocated to a class consisting primarily of fluid products shall be classified as Class I milk, and skim milk and butterfat allocated to another class shall be classified as Class II milk; and (6) If the form in which any fluid milk products is transferred to an other order plant is not defined as a fluid milk product under such other order, classification shall be in accordance with the provisions of § 1062.41.

[33 F.R. 14625, Oct. 1, 1968, as amended at 34 F.R. 18662, Nov. 22, 1969]

§ 1062.45 Computation of skim milk and butterfat in each class.

(a) For each month the market administrator shall correct for mathematical and other obvious errors the reports of receipts and utilization submitted pursuant to § 1062.30 for each pool plant of each handler;

(b) Compute the pounds of skim milk and butterfat in each class:

(1) At each pool plant of each handler; (2) In milk diverted from another handler's plant to a nonpool plant by a cooperative association pursuant to § 1062.8 (c); and

(3) In milk accounted for by a cooperative association as shrinkage of milk handled by the association pursuant to § 1062.8 (d); and

(c) In the case of the operator of more than one plant, allocation of producer milk to Class I and Class II milk pursuant to §1062.46 (a) and (b) shall be on an individual plant basis unless pursuant to such allocation fluid milk products are assigned pursuant to § 1062.46(a) (7) or (8), and the corresponding steps of § 1062.46 (b), in which case allocation pursuant to § 1062.46 shall be based upon the combined receipts and utilization (less transfers between pool plants of the same handler) at all plants of the handler (i.e., on a system basis); and

(d) Compute for each cooperative association reporting pursuant to § 1062.30 (c) the total pounds of skim milk and butterfat, respectively, in producer milk pursuant to § 1062.14(b) (1) and (2) (1) in each class. The amount so determined shall be those used for computation pursuant to § 1062.46(c).

§ 1062.46

Allocation of skim milk and butterfat classified.

After making the computations pursuant to § 1062.45, the market administrator shall determine the classification of producer milk for each handler (or pool plant, if applicable) as follows:

(a) Skim milk shall be allocated in the following manner:

(1) Subtract from the total pounds of skim milk in Class II milk the pounds of skim milk classified as Class II milk pursuant to § 1062.41(b) (8);

(2) Subtract from the remaining pounds of skim milk in each class the pounds of skim milk in fluid milk products received in packaged form from other order plants, except that to be subtracted pursuant to subparagraph (3) (v) of this paragraph, as follows:

(i) From Class II milk, the lesser of the pounds remaining or 2 percent of such receipts; and

(ii) From Class I milk, the remainder of such receipts;

(3) Subtract in the order specified below from the pounds of skim milk remaining in each class, in series beginning

with Class II milk, the pounds of skim milk in each of the following:

(i) Other source milk in a form other than that of a fluid milk product;

(ii) Receipts of fluid milk products (except filled milk) for which Grade A certification is not established, and receipts of fluid milk products from unidentified sources;

(iii) Receipts of fluid milk products from a producer-handler, as defined under this or any other Federal order or from a plant exempt pursuant to § 1062.60 (b);

(iv) Receipts of reconstituted skim milk in filled milk from unregulated supply plants; and

(v) Receipts of reconstituted skim milk in filled milk from other order plants which are regulated under an order providing for individual handler pooling to the extent that reconstituted skim milk is allocated to Class I at the transferor plant;

(4) Subtract, in the order specified below, from the pounds of skim milk remaining in Class II milk but not in excess of such quantity:

(i) The pounds of skim milk in receipts of fluid milk products from an unregulated supply plant that were not subtracted pursuant to subparagraph (3) (iv) of this paragraph;

(a) For which the handler requests Class II milk utilization; or

(b) Which are in excess of the pounds of skim milk determined by multiplying the pounds of skim milk remaining in Class I milk by 1.25 and subtracting the sum of the pounds of skim milk in producer milk, receipts from other pool plants and receipts in bulk from other order plants, that were not subtracted pursuant to subparagraph (3) (v) of this paragraph; and

(ii) Receipts of fluid milk products in bulk from an other order plant, that were not subtracted pursuant to subparagraph (3) (v) of this paragraph, in excess of similar transfers to such plant, if Class II milk utilization was requested by the operator of such plant and the handler;

(iii) The pounds of skim milk in receipts of milk by diversion from an other order plant for which Class II utilization was requested by the receiving handler and by the diverting handler under the other order, but not in excess of the pounds of skim milk remaining in Class II milk;

(5) Subtract from the pounds of skim milk remaining in each class, in series beginning with Class II milk, the pounds of skim milk in inventory of fluid milk products on hand at the beginning of the month;

(6) Add to the remaining pounds of skim milk in Class II milk the pounds subtracted pursuant to subparagraph (1) of this paragraph;

(7) Subtract from the pounds of skim milk remaining in each class, pro rata to such quantities, the pounds of skim milk in receipts of fluid milk products from unregulated supply plants which were not subtracted pursuant to subparagraphs (3) (iv) or (4) (i) of this paragraph;

(8) Subtract from the pounds of skim milk remaining in each class, in the following order, the pounds of skim milk in receipts of fluid milk products in bulk from an other order plant(s), in excess in each case of similar transfers to the same plant, which were not subtracted pursuant to subparagraphs (3) (v) or (4) (ii) of this paragraph:

(i) In series beginning with Class II milk, the pounds determined by multiplying the pounds of such receipts by the larger of the percentage of estimated Class II milk utilization of skim milk announced for the month by the market administrator pursuant to § 1062.22 (1) or the percentage that Class II milk utilization remaining is of the total remaining utilization of skim milk of the handler;

(ii) From Class I milk, the remaining pounds of such receipts; and

(iii) The quantity of skim milk, if any, subtracted pursuant to subdivision (ii) of this subparagraph shall be assigned pro rata to the receipts from other order plants under market pool orders and under handler pool orders which were assigned pursuant to subdivisions (i) and (ii) of this subparagraph (the skim milk subtracted pursuant to subdivision (i) of this subparagraph shall be subject to the same proration);

(9) Subtract from the pounds of skim milk remaining in each class the pounds of skim milk received in fluid milk products transferred or diverted from pool plants of other handlers (or other pool plants, if applicable) according to the classification assigned pursuant to § 1062.44 (a); and

(10) If the pounds of skim milk remaining in both classes exceed the pounds of skim milk in producer milk,

subtract such excess from the pounds of skim milk remaining in each class in series beginning with Class II milk. Any amount so subtracted shall be known as "overage";

(b) Butterfat shall be allocated in accordance with the procedure outlined for skim milk in paragraph (a) of this section; and

(c) Combine the amounts of skim milk and butterfat determined pursuant to paragraphs (a) and (b) of this section and § 1062.45 (d) for each class and determine the weighted average butterfat content of producer milk in each class. [33 F.R. 14625, Oct. 1, 1968, as amended at 34 F.R. 18662, Nov. 22, 1969]

MINIMUM PRICES

§ 1062.50 Basic formula price.

The "basic formula price" shall be the average price per hundredweight for manufacturing grade milk, f.o.b. plants in Minnesota and Wisconsin, as reported by the Department for the month, adjusted to a 3.5 percent butterfat basis and rounded to the nearest cent. For such adjustment, the butterfat differential (rounded to the nearest one-tenth cent) per one-tenth percent butterfat shall be 0.12 times the simple average of the wholesale selling prices (using the midpoint of any price range as one price) of Grade A (92-score) bulk butter per pound at Chicago, as reported by the Department for the month. For the purpose of computing the Class I price, the resulting price shall be not less than $4.33. [37 F.R. 3631, Feb. 18, 1972]

§ 1062.51 Class prices.

Subject to the provisions of §§ 1062.52 and 1062.53, the class prices per hundredweight for the month shall be as follows: (a) Class I price. The Class I price at plants located in Zone I shall be the basic formula price for the second preceding month plus $1.60.

(b) Class II milk price. The Class II price shall be the basic formula price for the month.

[33 F.R. 14625, Oct. 1, 1968, as amended at 37 F.R. 3631, Feb. 18, 1972]

one-tenth of 1 percent that such average butterfat test is above or below 3.5 percent, a butterfat differential computed by multiplying the Chicago butter price by the applicable factor listed below, and rounding to the nearest one-tenth cent;

(a) Class I milk. Multiply such price for the preceding month by 0.12; and

(b) Class II milk. Multiply such price for the current month by 0.115.

§ 1062.53 Location differentials to handlers.

For milk received from producers or from a cooperative association pursuant to § 1062.8(d) at a pool plant and which is classified as Class I milk or assigned Class I location adjustment credit pursuant to paragraphs (f) and (g) of this section or for other source milk to which a location adjustment is applicable, the price at such pool plant located:

(a) In Zone I of the marketing area, shall be the price computed pursuant to § 1062.51 (a) except as provided in paragraph (d) of this section.

(b) In Zone II of the marketing area, shall be the Zone I price plus a location adjustment of 7 cents;

(c) In Zone III of the marketing area, shall be the Zone I price plus a location adjustment of 17 cents.

(d) In Zone A (the Missouri counties of Barry, Christian, Douglas, Green, Howell, Laclede, Lawrence, Ozark, Stone, Taney, Webster, Wright, and Texas), for any plant which does not dispose of fluid milk products in consumer type packages and which is qualified as a pool plant pursuant to § 1062.12 (b) or (c) or a supply plant which qualifies pursuant to § 1062.12(d) shall be the price pursuant to § 1062.51(a) less 27 cents.

(e) Outside the marketing area and Texas County, Mo., and more than 30 miles from the City Hall, St. Louis, Mo., or the city hall in Springfield, Mo., whichever is nearer shall be the Class I price applicable in Zone I, less a location adjustment of 1.5 cents for each 10 miles or fraction thereof that such plant is located from the City Hall, St. Louis, Mo., or the city hall in Springfield, Mo., whichever is nearer (the distance to be by shortest hard-surfaced highway as determined by the market administrator);

(f) In the case of transfers between plants, location adjustment shall apply at the transferor plant with respect to a quantity of the transfer calculated as follows: From total Class I milk utilization at the transferee plant subtract

Class I milk assigned to receipts from other order plants and unregulated supply plants, and 95 percent of the receipts from producers and from cooperative associations as handlers pursuant to § 1062.8(d); and assign the remaining Class I milk to receipts from other pool plants beginning with receipts from plants with plus location adjustment, then to receipts from plants with no location adjustment, and then in sequence to receipts from plants at which the smallest minus adjustments apply.

(g) For purposes of calculations pursuant to this section, the following assignments of Class I utilization to pool plants will apply when allocation pursuant to § 1062.46 is performed on a system basis:

(1) Allocations to Class I pursuant to each of the following subparagraphs of § 1062.46 (a) and (b), will be assigned to the plant(s) at which any milk of the respective category was received or was in inventory, pro rata in each case to the respective quantities of such milk at each of such plants: § 1062.46 (a) and (b) (2), (3), (5), (7), and (8); and

(2) If Class I utilization pursuant to § 1062.45 (b) (1) remaining at a pool plant after subtraction of the quantities assigned pursuant to subparagraph (1) of this paragraph is greater than receipts from producers and cooperative associations as handlers pursuant to § 1062.8 (d) and other pool plants, Class I utilization equal to the amount of the excess will be assigned to the pool plant(s) of the hanIdler at which an equivalent amount of producer milk (including milk from a cooperative association pursuant to § 1062.8(d)) is not otherwise assigned to Class I, and at which the rate of location adjustment most nearly corresponds to that of the plant with such excess Class I utilization. The amount so assigned to another pool plant shall be added to Class I utilization pursuant to § 1062.45 (b)(1) in computing the assignment of location adjustments to receipts at such plant pursuant to paragraph (f) of this section. [33 FR 14625, Oct. 1, 1968, as amended at 38 FR 4771, Feb. 22, 1973]

§ 1062.54 Use of equivalent prices.

If for any reason a price quotation required by this order for computing class prices or for other purposes is not available in the manner described, the market administrator shall use a price determined by the Secretary to be equivalent to the price which is required.

APPLICATION OF PROVISIONS

§ 1062.60 Exemptions.

(a) Producer-handler. Sections 1062.40 through 1062.46, 1062.50 through 1062.54, 1062.61, 1062.62, 1062.70 through 1062.72, 1062.80 through 1062.89 and 1062.110 through 1062.122 shall not apply to a producer-handler; and

(b) Governmental agency. None of the provisions of this part except §§ 1062.13, 1062.44 (b), and 1062.46 (a) (3) (iii) shall apply to a plant operated by a governmental agency.

[33 FR 14625, Oct. 1, 1968, as amended at 38 FR 2745, Jan. 30, 1973]

§ 1062.61

Plants subject to other Federal orders.

The provisions of this part shall not apply with respect to the operation of any plant specified in paragraph (a), (b), or (c) of this section except as specified in paragraphs (d) and (e):

(a) A distributing plant which meets the pooling requirements of another Federal order and from which route disposition, except filled milk, during the month in such other Federal order marketing area is greater than was so disposed of in this marketing area, except that if such plant was subject to all the provisions of this part in the immediately preceding month, it shall continue to be subject to all of the provisions of this part until the third consecutive month in which a greater proportion of such Class I disposition is made in such other marketing area unless, notwithstanding the provisions of this paragraph, it is regulated under such other order;

(b) A distributing plant which meets the pooling requirements of another Federal order and from which route disposition, except filled milk, during the month in this marketing area is greater than was so disposed of in such other Federal order marketing area but which plant is, nevertheless, fully regulated under such other Federal order;

(c) A supply plant meeting the requirements of § 1062.12 (b) which also meets the pooling requirements of another Federal order and from which greater qualifying shipments are made during the month to plants regulated under such other order than are made to plants regulated under this part, except during the months of March through August if such plant retains automatic pooling status under this part;

(d) The operator of a plant specified in paragraph (a), (b), or (c) of this