Milk Cliff Possible if Farm Bill Doesn't Pass

Posted at: 12/23/2012 10:46 PM
By: Brittany Lewis

(ABC 6 News) -- Just eight days remain until the so-called Fiscal Cliff.  And while lawmakers are working to come up with a plan before the end of the year, the farm bill has been overlooked, and that could affect milk prices.     

Whether it’s a blue, pink, or red top, skim or 2%, milk prices could be doubling up to $6 or more per gallon.  

Much of the increase weighs on the ability of Congress to pass a new farm bill by the end of the year.

If they don’t, the milk rates, which are the minimum amount companies pay farmers for their milk, would return to what they were in the 1930s. Add in inflation and paying for milk could cost a pretty penny. Something Dairy Farmer Greg Asper doesn’t mind.

"If our price went up, then we could pay for our feed. It costs a lot of money to milk cows. With electricity and everything. That's all going up and we have a hard time paying our bills,” said Asper.

For Karen Davidson, the two or three gallons she crosses off her grocery list each week, could add up.

"But do you do I mean, you have to drink milk, you need calcium, you need good bones so I guess you don't have any choice, but to go with the flow,” said Davidson.

The farm bill expired at the end of September and is stalled in the house. Disagreements remain over cuts to food stamps. If a new bill is not passed, The Agricultural Act of 1949 would go into effect. That act contains basic provisions for setting milk prices. Some are confident a bill will pass.

"It's too political. Babies need milk. So your cliff will never happen with milk,” said Burt Iversen.

Leaving this milk cliff in the hands of lawmakers.

Experts say while the increase might be positive for Dairy Farmers at first, in the long run it could cause prices to collapse.