Posted: 09.02.2010

The milk that Wisconsin dairy farmers produced and sold in August is worh about a dollar more per hundredweight then it was in July.  Does that dollar really mean much of a spike for consumers?  Not really.

The Wisconsin Ag Statistical Service says that the August milk price will rise that dollar to $16.20 - which equates to about $1.39 per gallon at the farm gate for milk that you and I consume.  Just a year ago - the same Wisconsin dairy farm was trying to pay bills and keep going for $3.80 a hundredweight less! 

How close is that $1.39 per gallon to what you're paying at the grocery store?  Just for fun - now that you know the average Wisconsin farmer's getting $16.20 for their milk - take the price you pay at the grocery store and multiply it by 11.  That will give you a rough idea of what a Wisconsin dairy farmer would get paid IF there was a clear relationship between retail prices and farm gate prices.

Let's say the average retail grocery store price is around $3.50 per gallon for milk.  If you do the simple math there - that would mean the average Wisconsin dairy farm could expect their farm gate price to be $38.50 per hundredweight.

Obviously, there are a lot of expenses that have to be absorbed in that price.  Refrigeration - transportation - inspection, etc.  Still - I thought it  might be something that you, as an aware consumer - take with you to the grocery story the next time you're in the dairy showcase.

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