Impacts of the Northeast Interstate Dairy Compact on Supply, Retail Prices and the WIC Program: An Introduction

The Northeast Interstate Dairy Compact (Compact), the first regional dairy compact in the U.S., has been the focus of a great deal of attention and speculation during the past several years. The Compact was authorized under the Federal Agriculture Improvement and Reform act of 1996 and was enacted into law by each of the six New England states, Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont (U.S. Government). The Compact explicitly recognizes dairy farming as an important component of the New England landscape that provides both cultural and economic benefits to the region. The Compact's stated purposes are to assure the continued viability of dairy farming in the Northeast, as well as its associated support industries, and to provide consumers with an adequate local supply of pure and wholesome milk. The Compact provides a measure of farm fluid milk price control in the New England states in order to help satisfy these goals.