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Staff Writer
Tammy Harris of Winslow was shopping for her young family at the Shaw's supermarket in Waterville recently when she found herself depressed and frustrated in the dairy aisle.
"It's outrageous," Harris said as she put a gallon of store-brand milk, priced at $4.19, into her basket. "It was so cheap before. Who can afford that, especially for low-income families like myself, who are struggling and who can't get assistance?"
As Harris and other grocery shoppers have noted, the cost of milk and other dairy products like butter, cheese and yogurt is higher lately.
But not everyone thinks that's a bad thing.
"I don't have 10 kids, so I don't have a real problem with it," said Deborah Nielsen of Waterville, who also was shopping at Shaw's. "The farmers need it."
Farmers would agree. Were it not for high fuel and corn costs, industry experts say, they would be in a sweet spot.
Jimmy Hilton of Norridgewock, who milks more than 200 cows at his Sandy River Road farm, expects that he might be able to buy a new piece of equipment if prices for milk stay high.
That might be the case, given a price of $21.69 per hundredweight predicted for July. That is the price farmers are paid per 100 pounds of milk.
Stanley Millay, executive director of the Maine Milk Commission, said a price of $21.69 per hundredweight to the farmer would equate to a minimum price of at least $3.46 a gallon to the consumer for whole milk. Currently, the Maine Milk Commission's minimum price is $3.36.
For the farmers, there is a "but." As Millay put it, consumers will have their say.
"I think farmers are happy right now," Millay said. "They're getting to the point where they're optimistic. If things stay where they are, that's good."
Millay cautioned that should prices for dairy products -- driven largely by supply shortages -- keep rising for months, consumers will change their buying habits. They'll keep buying milk for the most part, but they will opt for margarine instead of butter and cut down on cheese.
"Stocks would go back up, and then the prices would fall," Millay said. "It's happened before."
As it is, customers are just beginning to see the price increases.
"It hasn't really pushed the milk prices on the shelf yet," Millay explained. "Retailers have absorbed it."
At Hannaford Supermarkets, the store brand whole milk cost $3.19 a gallon. Hood brand milk was priced at $3.55 and Oakhurst at $3.65.
Customers were paying $4.19 for store-brand milk at Shaw's, where both Hood and Oakhurst were priced at $4.79.
In June 2006, the minimum price for a gallon of whole milk in Maine was $2.68.
The current supply shortage that is adding to farmers' milk checks is good news for an agricultural sector that hasn't seen much of it. Over the past 10 years, prices were as low as $11.94 per hundredweight, and many dairy farmers went out of business.
"Any increase is good, but anything that's going to attract young farmers, you're going to need around $25," Hilton said. "It's better than collecting from the state."
Hilton appreciates the subsidy that the Maine Milk Commission provides. The commission sets minimum prices that are higher than those of the rest of the country. A special vendor's fee gives every farmer -- small and large -- the same benefit.
Hilton explained that Maine's tier program, which he referred to as a "safety net," got him $4 more for his milk.
"Without that program, there'd be hardly anybody left," Hilton said. "That has been a godsend."
Hilton took over the farm from his father, Frank, several years ago. Like the Piper farm in Embden and others, he speaks highly of the Hispanic workers he has hired.
"I can't find anyone else who wants to do the work, and they're reliable," he said. "They've been the best blessing we've ever had."
Son Alex also works the farm. Hilton's wife, the former Elizabeth Mosher, also comes from a family with a long history of dairy farming in Gorham.
Fewer and fewer young men such as Alex Hilton, however, are going into farming. And many others who have been doing it for years are getting out.
That can be a good thing for the farmers who remain.
"It's basic supply and demand," said Doug DiMento, spokesman for Agri-Mark, a Northeast dairy cooperative. "A lot of farms have gone out of business in the last year."
Darryl and Sarah McKeen operate a small, 100-acre dairy farm on Crosby Road in Albion.
Darryl McKeen, who milks 40 cows in addition to his job as a mail carrier, emphasizes that increased prices are somewhat offset by increased costs. The cost of diesel is more than $3 a gallon. And because more and more corn is being used for ethanol to produce fuel, farmers are paying a higher price for grain to feed their cows.
"Our costs are up," McKeen said. "Fuel prices are high and grain prices are skyrocketing because of ethanol. Our prices for feed are ridiculous right now."
McKeen does see the positive.
"We needed something good like this to happen," he said.
McKeen, 42, grew up in a farming family. His mother, Jean McKeen, and his brother Dennis operate a dairy farm just up the road. Though McKeen wouldn't give up his "day job" delivering the mail, he can't envision anything other than the farm lifestyle.
"Our kids are young, and we wanted to raise our kids on the farm," McKeen said. "I love it, and that's why I'm doing it."
Larry Grard -- 474-9534, Ext. 343
lgrard@centralmaine.com
Reader comments
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It sucks that milk costs so much at the store. But perhaps someone should take a look at the milk companies in the state to find out where that money really goes. 3/4 of the year it doesn't go to the farmer who slaved to make the milk. Farmers get a break during the summer, and this summer looks to be good for most of them. report abuse
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