What has happened to the price of milk? And, is the government paying dairy farmers to keep prices elevated? Huh? Do we want to spur inflation? (I know, you economists will tell me why inflation is so good for us now…, right?)
What’s the SDope on this? Why all of a sudden? (Mad cow, right?)
http://www.thedailystar.com/news/stories/2004/04/27/milk.html
Lots of reasons. Poor crops leading to shortage of feed. Low supplies of the eeevil BST hormone. Shortage of replacement heifers due to the Mad Cow scare. Fewer dairy farms resulting from years of low prices on milk. Ah, just read the article.
Dozens of things tweak milk prices. I don’t know much about gov’t subsidies, but I can tell you about some of the factors. The biggest thing right now is the Atkins diet. Demand for beef has shot up due to the low-carb dieters. Last year’s drought in parts of the grain belt still has feed prices up to painful levels. Between those two things, many small dairy farms find it more profitable to sell off their cows than to keep producing milk.
There is no OPEC for milk. Farmers are fiercely independent, and it just goes against their grain 
to surrender that to some big organization.
You’re not going to believe this: last week the local grocery store was selling milk for $0.99/gallon. It was a special promotion and obviously a loss leader, but the milk was perfectly good – it wasn’t like it was a day or two from expiring. More typically (every other week, say), the sale price per gallon is $1.99.
I just wanted to say that was a very original thread title.
In California, the Department of Food and Agriculture has ordered milk processors to pay the dairy farmers another 47 cents per gallon. The department also sets minimum retail prices to prevent milk from being “unfairly” sold as a loss-leader. In April, the minimum price for whole milk was $2.38 per gallon, now, it’s $2.93 in Northern California. Current California pricing is here. (PDF)
California regulates milk like a utility? Wow. Because of this the consumer can’t buy it cheaply (as a loss leader).
The same is true in New York. The state Agriculture Department sets a minimum price to be paid to farmers for milk. Yes, really. On Saturday, that legal minimum went up from $1.19 per gallon to $1.69.
I’ll second that, In the last year, my local grocery store (in Upstate NY) has regularly sold for $1.49 a gallon. This isn’t just a one time deal, it’s the regular price. There is fierce competition between two large chains (Wegmans and Topps), but I think what prompted the price slashing was the recent influx of WalMart super stores.
A year ago, we would pay between $2.29 and $2.79 for a gallon.
Your joke in the thread title scored me a free half gallon. Thank you.
Walked into the quick-stop for milk for work. Picked up 1/2 gallon. Clerk says “$2.25.” I had two singles in my hand and as I fished for a quarter, the guy said “Yeah, milk prices are going through the roof.”
When I said “Yeah, cows must have joined OPEC or something (totally ripping off Jinx’s line),” the clerk busted out laughing and wouldn’t take the money. He said that line was worth the $2.25.
