Calculation of Advanced Pricing Factors

These Class I Prices are calculated by adding applicable Class I differentials (for varying locations throughout the country) to advanced pricing factors for the month in question. In the following example, Class I prices for Dec 2009 for Cook County, Illinois are calculated using the appropriate Class I differential and Advanced values for Dec 2009 released the previous month on Nov 20, 2009

NASS Biweekly Average Prices

The advanced prices calculated in the section use biweekly average U.S. NASS survey prices. These biweekly average prices are calculated by a weighted average.

These biweekly average prices are as follows:

AA Butter 1.3532
Cheddar Cheese 1.5113
Dry Whey 0.3452
Nonfat Dry Milk 1.1147

Class I Skim Milk Price

(at Cook County, IL)

= (Higher of advanced Class III or Class IV skim milk pricing factors + applicable class1 differential)

= ($9.5 + $1.80)

= 11.3

So, the Class I Skim Milk Price for Dec 2009 is 9.5

Class I Butterfat Price

(at Cook County, IL)

= (Advanced Butterfat Pricing Factor + applicable class1 differential/100)

= ($1.4796 + $0.0180)

= 1.4976

So, the Class I Butterfat Price for Dec 2009 is 11.3

Class I Price

(at Cook County, IL)

= (Class I Skim Milk Price x 0.965) + (Class I Butterfat Price x 3.5)

= ($11.3×0.965) + ($1.4976×3.5)

= 16.1461

So, the Class I Price for Dec 2009 for Cook County, IL is 16.1461