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Despite Other Rising Food Costs, Dairy Prices Have Fallen

From rising avocado prices to the McDonald's Dollar Menu falling on hard times, over the last year, every section of the food industry has paid the price of cost increases. One segment of the food world, however, seems to have taken an opposite turn.

Prices of dairy products have seen a downward trend, as the weakening global economy has caused demand to decrease for US exports like milk. This decline has hurt certain sectors, such as dairy farmers and cheese producers: The value of cheese has dropped 40 percent over the last month. On the other hand, quite a few companies have seen the silver lining of falling dairy prices. Companies like Kraft Foods and Hershey's, and chain stores such as Domino's Pizza and Starbucks Coffee expect higher costs to be offset by favorable prices of milk and cheese.

While Kraft and other companies wouldn't comment on future price cuts, the plummeting value of dairy could trickle down to the consumer segment. Does it come as a relief to hear that at least one aspect of the food industry is seeing cost decreases?

Source

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workingmom workingmom 7 years
Dairy farmers are required to invest millions of dollars with little return for their monetary investment let alone the time invested. The government is also creating more regulations which increase the cost of producing milk. The dairy industry also has to use a lot of energy to plant and harvest crops and supply energy to run the milking equipment and keep the milk cool. Not to mention that a cow must be approximately three years old before it calves and produces milk. It must be taken care of and fed all that time. It's not like adding bought ingredients to produce other beverages. If we do not want to fairy compensate our dairy farmers, we will eventually have to import our milk. Will we be assured of it's quality? You should also talk to a dairy farmer before you assume that they are getting loads of subsidies.
SeptemberLights SeptemberLights 7 years
Darling- I'm going to have to agree with you about the whole subsidies thing. It is not representative of a truly Capitalistic society. When people start getting used to things it is hard to make them go away. I'm just happy I get to sample more gourmet cheeses right now!
DarlingDA DarlingDA 7 years
While I don't like to see anyone go out of business, dairy farmers do receive subsidies from the US government, so it's hard for me to be quite as sympathetic, as there are many other business out there going through extremely tough times that are getting by without government support. Other countries do not give out subsidies and their farmers manage. I think the reliance on subsidies has screwed up the US economy, and farmers/producers of products are so used to having that back up that those who can't sustain their business aren't weeded out, so when the market drops even slightly, it's a complete scramble for the business, which wouldn't have survived in the free market without the assistance.
ilanac13 ilanac13 7 years
well - that's a good thing for me since i'm not a vegan yet and i rely a lot on cheese for my protein. :) it's interesting to see how different things are affected
aimeeb aimeeb 7 years
Good to know!
LaLaLaurie06 LaLaLaurie06 7 years
I hope so. Milk is so expensive and Stop n Shop stopped its special milk rewards program!
Rancher'sGirl Rancher'sGirl 7 years
chiefdishwasher, you are right. Even if the prices were back at almost $6 a gallon, I'd buy milk and dairy products. Thank you for reminding me about the dairy farmers. They deserve every cent they earn and quite a bit more.
Rancher'sGirl Rancher'sGirl 7 years
Does this mean that Starbucks might actually LOWER their latte prices?? Just joking...we can be fairly certain that will not be happening. LOL ;) On the good side, as a delighted consumer of milk and cheese, I appreciate the small drop in milk prices. Ooey gooey melted cheese! :drool:
chiefdishwasher chiefdishwasher 7 years
Heck no! The poor dairy farmers are going to go out of business. The price they get for milk is half of what it was. A lot of small dairies are going out of business. Cows need to be milked twice a day and these people work 24/7.
Jude-C Jude-C 7 years
That's good news, but I'm pretty lactose-intolerant, so unfortunately it won't mean much for me on a practical level :(
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