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Milk Prices Skyrocketing; Analysts Say They Could Hit Record High Soon

By Jonna Lorenz   |   Wednesday, 19 Feb 2014 02:05 PM

The price of milk is increasing, with some analysts speculating that it will reach a record high by March.

The reasons for why the price is skyrocketing, according to NBC News, include increased cheese prices, greater international demand, and smaller herds of cattle because of higher feed costs. And the swell in milk prices shows no sign of slowing down; experts say milk could cost as much as 60 cents more by next month.

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Cheese reached a record high of $2.36 a block in January, up from $1.80.

The farm price for milk has risen to about $23 per 100 pounds, up from $17 to $18 per hundred pounds a year ago, according to Reuters.

Demand in China, which began last year, is a driving force for the higher milk costs. The demand lapped up milk supplies in the United States, the European Union, Australia, and New Zealand, according to Reuters.

Dairy exports increased 18 percent last year, with specialty cheese makers in Wisconsin seeing a 23 percent boost in exports during the first nine months of the year, according to the Minneapolis Star Tribune.

A severe drought in milk-producing states also has had an effect on costs, according to the Wall Street Journal.

Dean Foods, the country’s largest milk distributor, also is monitoring how an $8 billion cut to Supplemental Nutrition Assistance Program benefits might affect the market. Many homes that receive the benefits include children, who are big milk consumers.

Prices started rising in mid-2013 and are expected to level off by the summer, according to Reuters.

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The price of milk is increasing, with some analysts speculating that it will reach a record high by March.

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