How does a producer determine the amount to bid to retire his or her cows?
CWT will pay a Producer who makes a successful bid an amount equal to the price/cwt, multiplied by the herd’s milk production over the previous 12-month period. (The Producer must submit, along with the bid form, the applicable monthly production reports from his/her milk plant.) In general, CWT will award payments to those Producers who submit the lowest bid prices, subject to certain other program requirements. CWT makes a bid calculation form available on its website, www.cwt.coop, or will mail the form to producers who so request. Basically the calculation allows a producer to compute a bid price based on the producer’s judgment of the average market value of his or her average cow, less the slaughter value, divided by the average production per cow. For example (and this is for example purposes only), assume that the Producer believes that the average market value of a cow in his herd is $1600. Assume that the average cow in the herd weighs 1200 pounds, that the average annual mil
CWT will pay a Producer who makes a successful bid up to an amount equal to $3.75/cwt, multiplied by the herd’s milk production over the 12-month period April 1, 2009 through March 31, 2010. The Producer must submit, along with the bid form, a monthly production report for this period from his/her milk plant. In general, CWT will award payments to those Producers who submit the lowest bid prices, subject to certain other program requirements. CWT makes an interactiive bid calculator and a bid calculation form available on its website, www.cwt.coop, or will mail the form to producers who so request. Basically the calculation allows a producer to compute a bid price based on the producer’s judgment of the average market value of his or her average cow, less the slaughter value, divided by the average production per cow. For example (and this is for example purposes only), assume that the Producer believes that the average market value of a cow in his herd is $1350. Assume that the averag
