Milk prices show seasonal slippage after year-long rise

The average price per hundredweight of milk sold by farmers in New York state dipped at the mid-poin

The average price per hundredweight of milk sold by farmers in New York state dipped at the mid-point of December, continuing a slight decline from summer highs, according to the U.S. Department of Agriculture’s National Agricultural Statistics Service New York Office.

The average price paid to farmers per hundredweight of milk was $22.20 at mid-month, up $7.60 from last year but down 30 cents from the average price paid in November.

“[Milk prices] rose a lot over the past year. The factors that had been pushing up the price, like the dramatic rise in feed corn prices, have flattened out, and that’s trickled down to the dairy farmers,” NASS statistician Joe Morse said.

From September to November, grain corn purchased in New York fell 31 cents from $3.78 to $3.47 per bushel, but at the mid-point of December, grain corn prices ticked back up 21 cents to $3.68.

“There is probably a good three- to four-month lag in the price farmers are paying for corn and how it goes into [dairy cattle] feed mixes and comes out in dairy prices,” Morse said.

The federally mandated basement price for locally produced milk hit a record high of $25.01 per hundredweight of class 1 drinking milk in August. The price had risen steadily from January, when it was $15.09 per hundred weight, but has declined each month since August.

The milk price run-up occurred at the same time as spikes in grain corn prices stimulated by increased federal subsidies for corn-based ethanol production. Ethanol is an alcohol based fuel thought to have a net zero effect on carbon dioxide emissions because corn plants absorb as much CO2 as the fuel emits, according to the U.S. Energy Information Administration.

The USDA released other commodities data Monday. In mid-December, New York poultry producers received an average of $1.29 per dozen eggs sold, up 4 cents from November and 57 cents more than last year. Hay averaged $116 per ton, down $1 from November and $10 less than last year. Potatoes, sold at an average of $12 per hundredweight, were down 30 cents from last month but up 10 cents from December 2006. Fresh apples at the packing house door were 34 cents per pound, 5 cents more than last year at this time.

Categories: Business

Leave a Reply