Milk prices could go up - WALB.com, Albany News, Weather, Sports

Milk prices could go up

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COLQUITT COUNTY, GA (WALB) -

With the end of the year just a few days away, the country is looking to Congress to avoid the fiscal cliff.

But something called the dairy cliff is what is worrying farmers. Beginning next year, you could be paying as much as nine dollars for a gallon of milk if Congress doesn't pass a new Farm Bill.

Ricky Sparkman says if Congress does not pass a farm bill soon, the price you pay for milk could go up.

He runs Sparkman Cream Valley, a family owned and operated dairy farm that has been open since 1967.

"No farm bill right now would be devastating to the industry particularly the dairy industry," says Ricky Sparkman, Sparkman Cream Valley Owner/President.

The government subsidizes the dairy industry and guarantees milk producers a certain price to help keep them in business.

"That was designed for a mechanism to pay the farmers a better price, and ensure that the consumers weren't being over charged for the price," says Sparkman.

But that subsidy will expire January 1st. Instead of leaving farmers with no aid, a law from the 1940s will kick in, which means prices will jump to reflect the cost of milk production when the law was made, somewhere around $9 a gallon.

"Consumers are very sensitive to price right now and we have to try to listen to the consumers," says Sparkman.

Higher prices mean fewer people will be willing to fork up the extra money to buy that gallon of milk.

"The trickle down affect would come back to us, where we would have a tremendous surplus of milk and then it would drive the prices down to levels that we couldn't stay in business," says Sparkman. 

Sparkman is optimistic a deal will be made before the end of the year.

"I have enough confidence in our system that I think these guys will sit down and come together with a reasonable conclusion," says Sparkman.

But with the end of the year just days away, all Sparkman can do is wait and hope Congress pulls through.

The Agricultural Act calculates prices set in 1949. If enacted, milk could jump from $4 a gallon to more like $9 a gallon.

If you want to try some of Sparkman Cream Valley's dairy products, they're available at Tommy Mac's in Albany.