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Legislators Avoid Dairy Cliff

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MEDFORD, Ore. — Earlier this week, legislators stopped us from falling off the dairy cliff, which would have caused milk prices to double.

Legislators extended the dairy portion of the Farm Bill, so the nation won’t return to the 1948 formula for calculating milk prices. Dairy specialists say the old formula applied to 2013 would have doubled the price of milk as we know it. Oregon dairy specialists say dairy pricing is extremely complicated; meaning, a lot of factors impact the price, so it changes quickly and often.

“This month we are enjoying a good price for dairy, but next month that could change,” said Terry Allphin of Food 4 Less.

For now, Food 4 Less can offer a temporary drop in dairy product prices.

“We started noticing a decrease like in November or December a little bit and now this month has been really significant,” Allphin said. “So, it’s been pretty good for the consumer.”

Good for consumers like Gabrielle Chase, who is always searching for a sale.

“I always look at the prices they always have two different prices and I just pick the cheaper one all the time,” said Chase.

The prices shoppers see in the Rogue Valley may not have anything to do with the Farm Bill extension or give any indication of how milk producers are doing. Specialists explain it could just be that the store over-ordered for the holiday rush of shoppers and didn’t sell as much as they thought they would. If there would be a price jump in dairy products, specialists said consumers would most likely see it first in the liquid form, hitting people like Michele Rose the hardest.

“I have a son that’s 20-years-old and he drinks a gallon a day, so every week so we come to food for less and stock up every week we buy seven gallons of milk,” said Rose.

Then, consumers would see the increase in butter and cheese come later, because most grocery stores pay for those products months in advance.

“We had a butter that we had over the holidays for 2.99 – that’s our regular price – and now we’re going to run that on sale here shortly for a 1.99, so that gives you a pretty good idea, probably about 30 cents a pound on an average,” explained Terry Allphin.

The specialist with Oregon Dairy Farmers Association that NewsWatch12 spoke with was certain about the future of dairy and the potential of falling off that dairy cliff after the extension expires. He simply said that will never happen.