In Maine, there is a minimum price for milk that no store can go below. IIRC it is also illegal for a store to offer coupons for milk, or if the store has a reward program, to give reward points for buying it. Why do they do this? This only applies to liquid milk, and not other dairy products.
Price supports to prevent out-of-state dairies from killing whatever local dairy industry Maine has?
I lived in a state, and the law was you couldn’t sell milk for less than you paid for it. I guess it was to prevent milk wars.
Big supermarkets will sell everyday items like milk, bread, eggs etc at a loss just to get people through the doors. The low price of milk here in the UK is really hurting dairy farmers. It’s practically impossible to make a living out of it on its own. People are losing their livelihoods at an alarming rate.
Here’s an article from the Guardian.
Fair trade/minimum price laws in general were designed to protect small businesses; in the case of dairy, to protect small dairy farmers and dairies. Most of the laws were repealed starting in the 1970’s, and I’m a little surprised to hear Maine still has one on the books.
Here’s an article describing the fight that’s going on right now in the U.K.
So, people should pay more for milk when there is an apparent oversupply of milk?
Sounds like some of the milk producers should go out of business, resulting in an eventual increase in the price of milk.
Just because someone made the decision to be a milk producer doesn’t guarantee them a livelihood for life.
This is the problem when the government gets involved in market issues.
Sorry Omar, agricultural programs are exactly an area where government needs to be involved.
Agriculture has long lead times/slow response due to one crop per year. It requires significant infrastructure and land/water availability, so there are big hurdles to entry. People are averse to hunger, so the demand is rather inelastic. All of these make for volatility when left to the free market.
Food production needs to be inefficient in the sense that if there is typically an oversupply, then when an unpredictable event happens, shortages can be avoided, and avoiding food shortages is a good thing.
An oversupply tends to drive prices downward forcing small producers out of the market, or worse, to try to produce more to restore profits, which adds to the glut. This happened with wheat in the 1920’2-30’s and the resulting over planting was a big factor in the dustbowl of the 30’s. Falling prices can also increase demand, and that can lead to monoculture, leaving society susceptable to, for example, potato blight.
Yes people should pay more. The problem isn’t oversupply, it’s that supermarkets lose money on milk so you will buy other things while you are there. The good news is that with growing awareness of the problem, people are overwhelmingly willing to pay more.
The problem with allowing market forces to run unchecked and unrestrained is that they do tend to turn the world into a nightmarish dystopia.
I can’t quote you the statute in Texas, kunilou, but we do have a similar thing here as well.
When I was employed by Albertsons, we had a price scanning accuracy guarantee: if the item you wanted to purchase rang up wrong because of the bar-code programming (we had an employee whose job was literally “Scan Coordinator” - that’s what she did!), you got it for free. There were some things enumerated, though, to which this did not apply: prescription medicines, alcohol, and tobacco, obviously, but also milk. We couldn’t give you your milk for free. The most we could do was charge you the correct price.
In the 21st century (I’ve been out of the grocery business for 20 years), I’ve seen a similar thing at Tom Thumb. They might give you a “$5 off $20” or “$5 off $30” promotion on your loyalty card, but you can’t count dairy products to reach the discount threshold.
I love threads that let me use the three-and-a-half years I spent as a supermarket cashier to fight ignorance.
The Northeast Dairy Compact covers all the New England states.
As I understand it, milk pricing to farmers is generally set by federal law. Here is a representative article. State minimum-price laws are more aimed at protecting (i.e., subsidizing) local *stores *against the big chains offering cheaper enticements, as others have described.
Take a second look at your link; it notes that that compact has expired.
Remind me, when is milk season? 
Next year it will be June 2-5. Don’t you know anything, Tom?
How does the supermarkets losing money on the milk affect the producers? Assuming there is no oversupply of milk, producers should be pricing it fairly so that they can earn a reasonable living on it. If the supermarkets then choose to price the milk at below their cost, in order to entice customers to come in and purchase other items while they’re there getting milk, then it’s the supermarket eating a loss on the milk, not the producer. And indeed, since the milk is clearly such an important item to the supermarkets, unless there is oversupply, the producers should be able to charge fair prices; the markets don’t appear to have any massive leverage in which they can force the dairy farmers to keep the prices down, the producers have no incentive to do so.
So, I don’t see how the dairy farmers and milk producers are the ones harmed by this - the harm appears to be directed at smaller supermarkets that can’t afford to take losses on the milk just to get people in the door to buy other things. They have to price the milk above their cost, which presumably means less people buying there.
ETA: The Guardian article linked even points out that there IS an oversupply of milk: “Thanks to a global surplus of milk, a contraction of international markets, an increase in feed prices plus the supermarket wars…”
Wow, am I outta date. :smack: