Demand expected to boost milk price

US - Consumers coping with escalating gasoline prices had better brace themselves for another sticker shock: milk prices.
calendar icon 9 April 2007
clock icon 1 minute read
Last week, a gallon of whole milk cost approximately $3.05. In a few months, that price could be $3.35, according to Ken Bailey, a Penn State University agricultural economist specializing in the dairy industry.

"We go through a lot of milk," said Bridget Rini, a Camp Hill mother of six. "It will bring our bill up, but we will still be buying our 10 gallons a week.

"I'd rather spend my money on milk than soda. It probably will mean a few less extra goodies in the shopping cart."

The global economy is responsible for the expected milk price increase, said state Agriculture Secretary Dennis Wolff, a longtime Columbia County dairy farmer.

"There's a very strong global demand for skim milk powder and whey, especially in China," Wolff said.

"Milk production is down in Australia because of drought and down in Europe because the European Union has decreased or eliminated subsidies to dairy farmers," he said. "So Southeast Asia has turned to the United States for milk."

Meanwhile, Wolff said, domestic milk production has grown 1.5 percent annually in the past decade. He said the increase in domestic milk consumption has been less than that, although it increased nearly 1 percent last year because of increased yogurt consumption.

Source: Patriot-News
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