Milk prices could go up as "Dairy Cliff" looms - WKOW 27: Madison, WI Breaking News, Weather and Sports

Milk prices could go up as "Dairy Cliff" looms


MADISON (WKOW) -- With the farm bill's fate still unknown, the retail price of milk could spike in 2013.

The so-called "fiscal cliff" has largely been the focus in Washington but anxiety is growing about how Congress' inaction could affect farmers and dairy consumers. According to Agriculture and Applied Economics Professor Brian Gould from UW-Madison, retail milk prices could increase by about 50 percent over an extended period of time. The New York Times reports prices could double. "We've never been in this situation before so we really don't know what outcome is probable," Gould said.

Price changes will hurt almost all Americans at the grocery store and businesses that rely heavily on dairy ingredients."Dairy is a very big part of our business here at the Daisy Cafe & Cupcakery," Co-owner Daryl Sisson said. The business sells at least 5,000 cupcakes each month and several other dairy-based items on their cafe menu. "It leaves us with a lot of anxiety until the time comes where we hear a solution," he said.

It's left some grocery shoppers worried as well. "We'll have to buy milk. My son needs it -- he's growing," Chris Ayres said. He thinks an increase will put a decent dent in his family's wallet.

Gould says if Congress doesn't create an extension of the current farm bill or tack new proposals to the fiscal cliff deal, dairy purchasing will go back to a system based on 1949 legislation. The USDA will have to purchase milk based on an out-of-date system.



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