Milk Prices On the Rise - KLTV.com - Tyler, Longview, Jacksonville |ETX News

4/7/04 - Tyler

Milk Prices On the Rise

Most people see it as a necessity, and it's about to cost you more. Milk prices went up the first of this month, and according to the National Milk Producers Federation, prices will likely continue to increase into the summer. We went to several different stores around Tyler to check on this week's prices.

At Wal-Mart, milk starts at $3.32 per gallon and goes all the way up to $3.47. At Albertson's, $2.89 to $4.09. Milk at Super 1 Foods ranges from $2.89 to $4.25. The cheapest milk at Brookshire's costs $2.89, and the most expensive, $4.55. Several convenience stores price their milk from $3.29 to $3.99.

Products made with milk will also get more expensive, especially cheese, butter, chocolate, and ice cream. Milk producers say rising prices are a result of too much demand and not enough supply, which is bad news for consumers, but good news for dairy farmers, who say milk prices have been at record lows for the past two years.

"Last year, a number of industry leaders got together and organized an industry-funded buyout program, where we reduced the total production of milk," Barry Shaw, co-owner of Waitex Farms in Edom, said.

Dairy farmers are selling their older cows for a profit to the beef industry. That option is appealing because beef prices are up. However, that leaves fewer cows to produce milk.

"Feed prices have started to increase, so that's impacting the amount of feed that farmers can afford to feed their cows," Shaw said. "And therefore, we're getting somewhat lower production."

But industry officials say price fluctuation is cyclical, which means milk prices may go down again several months or a year from now. Industry officials say higher milk prices will help dairy farmers pay off a lot of debt that has piled up over the last two years. However, it's not helping businesses that buy a lot of milk, like restaurants and school cafeterias.

Julie Tam, reporting.

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