Proceeding pursuant to CPLR article 78 (transferred to this court by order of the Supreme Court in Albany County) to annul the determination of the Commissioner of Agriculture and Markets of the State of New York, which denied petitioner’s application for an extension of a milk dealer’s license. Petitioner owns 92 supermarket stores in New York State. It holds a milk dealer’s license authorizing it to distribute milk to 86 of its stores in 21 counties of the State. Petitioner in this application seeks to extend its license into Lewis, Jefferson and St. Lawrence Counties in order to service its six remaining stores located there. The respondent denied petitioner’s application on the ground that it would tend to be destructive of competition in markets already adequately served and would not be in the public interest. Petitioner contends that the denial of its application was erroneous, in that the record is barren of proof that the issuance of its license would destroy competition. We disagree. The determination is supported by a preponderance of the evidence before the commissioner. The region involved is one of substantial milk production and low population. Its population is declining. The level of competition amongst milk dealers is intense. All the plants in the area are operating well below capacity. To grant the license would further decrease the volume of the plants and cause the dealers to compete more aggressively in the diminished market. The evidence supports the conclusion that to grant the application would, have an adverse effect on distributors and impair their ability to maintain viable businesses. This would in turn jeopardize an adequate system for processing and distributing milk in these northern counties (Matter of Tuscan Dairy Farms v Barber, 58 AD2d 491, affd 45 NY2d 215). Determination confirmed, and petition dismissed, without costs. Mahoney, P. J., Greenblott, Staley, Jr., Mikoll and Herlihy, JJ., concur.