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Milk prices may double to $7

usa dairy cliff agriculture bill national milk producers federation

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#1 Hum

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Posted 23 December 2012 - 00:26

With Congress spending all its time trying to avert the fiscal cliff, a slew of other legislative matters are going unattended. One of them is the agriculture bill which, if not addressed, could lead to a doubling of the price of milk early next year.

It works like this: In order to keep dairy farmers in businesses, the government agrees to buy milk and other products if the price gets too low. The current agriculture bill has a formula that means the government steps in if the price of milk were to drop by roughly half from its current national average of about $3.65 a gallon.

Problem is, the current bill expired last summer, and Congress had been unable to agree on a new one. Several protections for farmers have already expired, and several more are set to do so over the next few months. One of them is the dairy subsidy, which expires January 1.

But instead of leaving farmers entirely out in the cold, the law states that if a new bill isn't passed or the current one extended, the formula for calculating the price the government pays for dairy products reverts back to a 1949 statute. Under that formula, the government would be forced to buy milk at twice today's price -- driving up the cost for everyone.

"If you like anything made with milk, you're going to be impacted by the fact that there's no farm bill," U.S. Secretary of Agriculture Tom Vilsack said.

"Consumers are going to be a bit shocked when instead of seeing $3.60 a gallon for milk, they see $7 a gallon for milk. And that's going to ripple throughout all of the commodities if this thing goes on for an extended period of time," Vilsack said.

Sky-high milk prices wouldn't necessarily be good for dairy farmers either, according to Chris Galen, a spokesman for the National Milk Producers Federation, which represents over 30,000 dairy farmers.

While it might provide a short term boost to profits, there's a fear that consumers would either cut back on dairy or opt for imported dairy products. It could also force food makers to search for alternatives to dairy, like soy.

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#2 rippleman

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Posted 23 December 2012 - 00:31

subsidies are for industries that need thinning... let the market sort it out.

#3 Xilo

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Posted 23 December 2012 - 00:31

I drink a lot of milk for protein shakes and cereal. Definitely will stop/find alternatives if it goes to $7. That's damn ridiculous.

#4 OP Hum

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Posted 23 December 2012 - 00:37

Don't see the difference -- whether taxpayers pay subsidies to milk farmers, or pay $7 at the store.

Might also cut down on overweight people and medical problems, and that extra expense to taxpayers.

And many people could always buy a cow ... ;)

#5 Xilo

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Posted 23 December 2012 - 00:44

Don't see the difference -- whether taxpayers pay subsidies to milk farmers, or pay $7 at the store.

Might also cut down on overweight people and medical problems, and that extra expense to taxpayers.

Taxes aren't going to go down if the government doesn't pay subsidies, so everyone loses.

People don't (normally) become overweight from drinking milk. :/

#6 OP Hum

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Posted 23 December 2012 - 01:06

^ It isn't just milk -- it's all the things made from milk too. Cheese, ice cream, baked goods, and the things people eat with milk.

#7 xpablo

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Posted 23 December 2012 - 01:23

One just has to go shopping to within 50 miles of the states that borders Canada, as East Indians from Canada come to the US to buy gallons and gallons of milk, look at Costco in Bellingham,Wa they sell more milk than any other place in North America, if milk were to go up to $7 a gallon that would all come to a screeching halt.



#8 vetneufuse

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Posted 23 December 2012 - 01:26

no, it won't, next story to create panic and anger please...

#9 Growled

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Posted 23 December 2012 - 01:51

I figure the government will sort it out before it's all said and done. If they don't I imagine more than a few of those bozos will be looking for a job next election time.

#10 Alladaskill17

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Posted 23 December 2012 - 01:55

I drink a lot of milk for protein shakes and cereal. Definitely will stop/find alternatives if it goes to $7. That's damn ridiculous.

I use water rather than milk for the shakes, not quite as tastey, but pretty close (and less calories - barely depending on milk type, but still). Cereal on the other hand... :cry:

#11 shozilla

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Posted 23 December 2012 - 01:56

^ It isn't just milk -- it's all the things made from milk too. Cheese, ice cream, baked goods, and the things people eat with milk.


Doesn't matter. If you eat and sit a lot, you will be overweight but if you workout couple of times a week, you will be fine.

#12 remixedcat

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Posted 23 December 2012 - 03:59

I got plenty of milk

#13 *RedBull*

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Posted 23 December 2012 - 05:25

^ It isn't just milk -- it's all the things made from milk too. Cheese, ice cream, baked goods, and the things people eat with milk.

No problem, people need to have a better diet anyway.

I got plenty of milk

That I'd like to see. :shifty:

#14 JaredFrost

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Posted 23 December 2012 - 05:39

^ It isn't just milk -- it's all the things made from milk too. Cheese, ice cream, baked goods, and the things people eat with milk.


And it isn't the milk part of those things that is the problem, it's the sugar and carb part, excluding cheese, which is fine if you don't eat lots of the other stuff too.

Doesn't matter. If you eat and sit a lot, you will be overweight but if you workout couple of times a week, you will be fine.


Exactly.

#15 +Chris123NT

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Posted 23 December 2012 - 05:44

7 dollars is ludicrous. I'm starting to be happy about the fact that I'm lactose intolerant :p



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