Expect to pay more for ice cream, butter and yogurt, as prices for raw milk in Iowa head toward an all-time record. Kim Polvin with the Midwest Dairy Association says it’s been a long time coming.She says they’ve been facing some tough obstacles, including prices close to a 25-year low paid within the last year, which drove many out of business. For the last two years milk prices paid to producers have been low, and a recent market forecast revised downward the amount of milk producers are expected to send to market. Fewer dairy farms meant less milk, so she says today’s rising prices are in part a result of supply and demand. With more dairy farmers forced out of business, there’s been less raw milk and price per hundred-weight is rising toward 18-dollars, more than 50-percent more than it was a year ago. Polvin says dairy farmers who’ve managed to hang on with prices below their cost of production are finally hoping to see a profit. But she points out they don’t set the price you pay at the checkout counter, rather that’s set by the retailer and affected by many factors including supply and demand, processing and transportation costs, and the overhead at the retail store. A market prediction on “cattlemarket-dot-com” says not only will milk production be lower for the foreseeable future, consumer demand is expected to rise, which could mean higher prices for dairy farmers — and for milk prices in the store — will stick around.
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