“In the U.S., the amount of milk we produce and the amount consumed, either as fluid or in products — those two lines are very close,” said Mike Brouk, Kansas State associate professor and extension dairy specialist. “We don’t have a lot of excess product in the system. When the supply and demand lines are so close, a small change is going to have an impact.”

Brouk said officials think the prices are at or near their peak, but several small changes occurred recently to cause the spike:

• Increased consumption worldwide
  
• Weather conditions in New Zealand and Australia affected the amount of dry milk powder produced and exported. (The United States uses some of that powder in the manufacture of dairy products, such as ice cream, cheese and yogurt.)
  
• Summer heat wave stressed cows and limited their milk production.

“In severe cases, we might see a 20 to 25 percent reduction due to heat stress,” Brouk said.

Rising fuel costs

Ethanol production increased the demand for corn, which is the main feed used for dairy cattle.

Local impact

Despite rising by more than $1 per gallon in the past year, higher dairy prices have had minimal effect on local families and organizations.

• Laurnene Frey, of Topeka, said her family has cut back slightly on their milk consumption, but they won’t give it up.

“We have to have it,” Frey said, adding that they buy at least two or three gallons of milk per week. “We want the kids to be healthy. What are you going to do? We just have to grin and bear it.” •

• More than 1.7 million half-pint containers of milk were served last year and 125 gallons of milk and buttermilk were used in recipes for the Seaman Unified School District 345, said food service director Kaye Kabus.

Source: Topeka Capital Journal