Milk prices could hit a record

Milk prices could hit a record
Updated: Feb. 19, 2014 at 4:57 PM HST
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HONOLULU (HawaiiNewsNow) - Like rental rates and a gallon of gas, milk prices are measuring sticks. Hawaii consumers pay nearly double the national average per gallon.

"Hawaii's families are exhausted by just keeping up with the cost of living that we don't get to live," shopper Malia Gray said.

Dairy experts predict milk prices will soar by up to 60 cents more by the end of march. That would reach an all-time high.

"Paying too much for milk just cuts into the pocketbook because we use it every day," said consumer Kent Sharp.

The milk industry said China and other countries are buying more American milk, straining supplies in the U.S. But Hawaii Pacific University economics professor Ken Schoolland believes fault lies with the Farm Bill. He said mainland milk producers no longer worry about consumer backlash to price hikes.

"The Farm Bill added a trillion dollars over the next ten years to the expenses out of pocket for consumers, and a lot of regulation that favors the dairy industry," Schoolland said.

Other economists think the anticipated jump is linked to California's drought and high cost of feed for dairy cattle. About 80 percent of milk consumed in Hawaii is shipped in from California, then pasteurized at Meadow Gold and delivered to super markets. Each step adds to the cost at the checkout counter.

"It's going to affect you in some way, whether it's on the table or it's at the end of the month when you have to look at all your bills," Gray said.

Schoolland said government should do more to help Hawaii's remaining dairy farms and decrease dependence on imported milk.

"We could lower the cost of feed coming in by allowing exemptions to the Jones Act, for example, so there could be much more competitive pricing in our feed that's coming to our dairies," he said.

Earlier this month, speculation was that milk prices would go down because of the Farm Bill. Now the expectation is just the opposite.

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