Rising Milk Prices Milking Pocketbooks

WOODBURY, Minn. (WCCO) -- Milk does a body good but it may not be doing the same for your pocketbook.

According to the U.S. Department of Agriculture, milk prices have gone up an average 38 percent in the past year.

The price hike has to do with what's going on in the dairy fields where grocers buy their milk. It's extremely hot on those fields to the point where many are even experiencing drought.

When it's hot, cows don't eat as much. When they don't eat as much, they don't milk as well.

If there's no nutritious grass, dairy farmers have to turn to feed. Adding insult to injury: right now, the cost of hay and corn is also high.

This puts those who view milk as a staple, like Woodbury mother Angie Polacek, in a bind.

"I have two older boys at home and, I mean, they drink milk instead of water," said Polacek.  "Three gallons ... that won't last very long, I mean I'll have to buy it again this week."

Perhaps only mothers who have boys can relate to going through eight gallons of milk a week. 

Several of the customers shopping at the Kowalski's in Woodbury said milk is a staple to their meals. This may explain why despite price hikes, customers are still buying.

Mike Oase, the VP of Operations at Kowalski's, said sales have stayed flat.

"The anti-biotic free and hormone free milk, that's increased 48 cents from a year ago," Oase said.

He said you will only see a 30-cent increase on the price tag of that milk because the grocer has absorbed some of the burden.

"You have to try to find a balance of maintaining a margin that helps pay for the overhead in your business, of course, at the same time, trying to have reasonable retails for customers," Oase said.

It's not just milk, you'll notice inflated prices on ice cream and butter too.

Customers say they are finding ways to cope with the high prices of milk products and milk from shopping around to forgoing the non-staple foods all together.

Oase also said his suppliers are saying international demand is way up. China also depends on America's cows for milk. When demand goes up, supply goes down, forcing prices to go up.

Sugar prices are up almost 20 percent and the cost of high-fructose corn syrup just went up more than 22 percent.