Dairy Facts - Retail Milk Pricing

Will milk prices go up in 2013?

For the foreseeable future, it is unlikely that retail milk prices will double, like many speculated. At the close of 2012, Congress approved legislation to avoid the automatic tax hikes and spending cuts known as the “fiscal cliff.” This measure also averted the “dairy cliff” which would have lead to a steep increase in milk prices. Specific to dairy, the tax agreement addresses the expiring farm subsidy programs by extending the 2008 Farm Bill for one year. Without the deal, the 2008 Farm Bill would have completely expired and dairy subsidies could have returned to 1949 levels, meaning retail milk prices could have doubled to about $7 a gallon in the coming weeks or months.

What factors can affect the price of milk at the grocery store?

The price of milk at the grocery store can fluctuate due to changes in supply and demand, just like other foods. Dairy foods are still one of the most cost-effective investments you can make for your family's health. Enjoying three servings of milk, cheese or yogurt every day is a way for people to spend their food dollar wisely and obtain important nutrients.
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Who sets the price of milk at the grocery store and how much does the farmer receive?

Farmers do not set the milk price. Wholesale and retail prices are determined by a complex formula of supply and demand, along with other factors. There is often a variance in the retail price of milk from store to store, and from city to city. This is because grocery retailers, mass merchandisers, convenience stores and drug stores determine their retail prices differently, taking into account processing, transportation and marketing costs. According to recent USDA data, on average, dairy farmers receive about 30 cents of every dollar consumers spend on food.

My family is on a tight budget. Are there any foods I can substitute for dairy?

Dairy foods remain a solid value for consumers. Dollar for dollar, no other food offers as much nutrition as milk. Milk offers calcium and eight other essential nutrients. In fact, it takes three cups of broccoli to equal the calcium in one cup of milk.
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