[Looks like the prices for a gallon of gas and a gallon of milk might
eventually equal each other...]

http://www.chicagotribune.com/busine...l=chi-news-hed


Milk chugs toward record high

Demand for ethanol drives up dairy costs


By John Schmeltzer
Chicago Tribune staff reporter

June 14, 2007, 9:29 PM CDT

"Milk, already hovering around $4 a gallon in the Chicago area, could cost
as much as $4.25 a gallon to $4.50 a gallon by September.

In Florida, milk is likely to rise to more than $5 a gallon, Bill Brooks, a
dairy economist with Downes-O'Neill, one of the nation's largest dairy
product brokerage firms, said Thursday.

"We have a new competitor," Brooks told more than 100 people at a conference
of producers and processors in Chicago. He said dairy farmers are paying
higher prices to feed their cows as a result of ethanol production that
depends on corn and other rough grains. "And the government is subsidizing
this competitor."

Brooks was referring to the 51 cents-per-gallon subsidy that is paid to
ethanol producers by the government. The payment is designed to keep the
costs low for ethanol and encourage its increased use as a fuel alternative
to gasoline.

Corn prices have surged 73 percent in the past year on higher ethanol
demand, reaching a 10-year high of $4.5025 a bushel on Feb. 26. On Thursday,
corn rose to a three-month high on the Chicago Board of Trade, closing at
$4.095 per bushel.

Earlier this week, Dean Foods Co., the country's largest milk processor,
predicted that raw-milk prices will set a record later this year.

Despite soaring milk prices, the U.S. Department of Agriculture said
Thursday that farmers are reluctant to increase the size of their herds when
prices for feed are rising faster than the price of milk. That means
production is expected to be limited.


Prices for other foods are also rising.

The American Meat Institute, which represents the nation's beef, pork and
chicken producers, said that corn previously used to feed animals is
increasingly being diverted to ethanol production.

"Saying rising feed prices don't have a direct impact on the cost of food is
as ridiculous as saying that rising gasoline prices will not result in
people paying more to fill up their cars," said David Ray, an institute
spokesman.

Already, consumers are paying 8 percent to 10 percent more for breakfast
foods than a year ago because of the rising prices for corn, wheat, milk and
other commodities, according to the Department of Agriculture.

Retail prices for orange juice have risen 20 percent to 25 percent from a
year ago, while eggs have climbed 15 percent to 20 percent. Overall, food
prices are expected to rise 3.5 percent to 4.5 percent, about 1 percentage
point higher than in 2006, the USDA estimates.

Carl Weinberg, chief economist for High Frequency Economics, has warned that
higher food prices could spell trouble for the U.S. economy.

"The trend in food prices did not go well in the 1970s, and we fear that a
repeat of that squeeze is in progress now," he wrote in a note last week.

The USDA estimated this week global grain stockpiles could drop more than 5
percent this year as a result of increased demand and droughts.

Weinberg said the new estimate means there might only be a 53-day supply at
the end of the year compared to the 69.9-day supply just two years ago.

"These stockpiles estimates are as low as they have been since the early
1970s, and that is not good news," he said Thursday. "If food prices jump,
then inflation measures will jump."

An Iowa State University study of the impact ethanol consumption is having
on food prices appears to confirm many of Weinberg's concerns.

The study projects that consumers could wind up spending $47 more per person
annually on food if oil prices remain above $65 a barrel and grain prices
keep rising. Oil closed Thursday at $67.65 a barrel, up $1.39, on the New
York Mercantile Exchange.

On Thursday, Brian Hoops, an analyst with Midwest Market Solutions in
Yankton, S.D., told Bloomberg News that farmers may liquidate hog herds to
avoid paying higher feed costs. Hog prices are up 22 percent this year on
export demand for pork and higher corn costs. Beef prices are only a little
behind; they have risen 16 percent in the past year, reaching a record
$1.02925 a pound on March 12.

Congress is considering legislation that would require a 36 billion-gallon
renewable-fuel standard, nearly four times higher than 7.5 billion-gallon
standard required to be met by 2012. Most experts say that the standard will
be met mainly with increased production of ethanol and biodiesel fuel.

"The problem with government mandates is that they are not responsive to
market signals or problems like drought," said Ray from the meat institute.
"In terms of food prices, near term, we see the problem getting worse, not
better."

/

On 2007-06-15, Gregory Morrow wrote:

"Milk, already hovering around $4 a gallon in the Chicago area, could cost
as much as $4.25 a gallon to $4.50 a gallon by September.

Good thing I don't drink/use the stuff.

nb

notbob wrote:

On 2007-06-15, Gregory Morrow wrote:

"Milk, already hovering around $4 a gallon in the Chicago area, could cost
as much as $4.25 a gallon to $4.50 a gallon by September.

Good thing I don't drink/use the stuff.


I use it for coffee and cooking and smoothies but not for straight (as
opposed to gay? hehe) drinking. I use about three quarts of 1% milk
per week...

I have to wonder where they get the "$4 a gallon in the Chicago area"
pricing, I never pay more than $2.50 or so at Walgreen's, they feature
milk as a loss leader (a coupla weeks ago for $1.99 per gallon). Just
picked up 2 half - gallons for $1.29 each at the local stupormarket
(Treasure Island) down the street...

Maybe they are pricing milk at convenience stores or something...

Yogurt's been on sale a lot lately and ice cream seems fairly
reasonable yet...

As for other food prices, chicken and beef have been fairly expensive
for a whiles, pork less so...and I just picked up eggs for $.99 per
dozen at Walgreen's too.

--
Best
Greg

On Jun 15, 6:29 am, "Gregory Morrow" wrote:
[Looks like the prices for a gallon of gas and a gallon of milk might
eventually equal each other...]

http://www.chicagotribune.com/busine...,5301338.story...

Milk chugs toward record high

Demand for ethanol drives up dairy costs

By John Schmeltzer
Chicago Tribune staff reporter

June 14, 2007, 9:29 PM CDT

"Milk, already hovering around $4 a gallon in the Chicago area, could cost
as much as $4.25 a gallon to $4.50 a gallon by September.

In Florida, milk is likely to rise to more than $5 a gallon, Bill Brooks, a
dairy economist with Downes-O'Neill, one of the nation's largest dairy
product brokerage firms, said Thursday.

"We have a new competitor," Brooks told more than 100 people at a conference
of producers and processors in Chicago. He said dairy farmers are paying
higher prices to feed their cows as a result of ethanol production that
depends on corn and other rough grains. "And the government is subsidizing
this competitor."

Brooks was referring to the 51 cents-per-gallon subsidy that is paid to
ethanol producers by the government. The payment is designed to keep the
costs low for ethanol and encourage its increased use as a fuel alternative
to gasoline.

Corn prices have surged 73 percent in the past year on higher ethanol
demand, reaching a 10-year high of $4.5025 a bushel on Feb. 26. On Thursday,
corn rose to a three-month high on the Chicago Board of Trade, closing at
$4.095 per bushel.

Earlier this week, Dean Foods Co., the country's largest milk processor,
predicted that raw-milk prices will set a record later this year.

Despite soaring milk prices, the U.S. Department of Agriculture said
Thursday that farmers are reluctant to increase the size of their herds when
prices for feed are rising faster than the price of milk. That means
production is expected to be limited.

Prices for other foods are also rising.

The American Meat Institute, which represents the nation's beef, pork and
chicken producers, said that corn previously used to feed animals is
increasingly being diverted to ethanol production.

"Saying rising feed prices don't have a direct impact on the cost of food is
as ridiculous as saying that rising gasoline prices will not result in
people paying more to fill up their cars," said David Ray, an institute
spokesman.

Already, consumers are paying 8 percent to 10 percent more for breakfast
foods than a year ago because of the rising prices for corn, wheat, milk and
other commodities, according to the Department of Agriculture.

Retail prices for orange juice have risen 20 percent to 25 percent from a
year ago, while eggs have climbed 15 percent to 20 percent. Overall, food
prices are expected to rise 3.5 percent to 4.5 percent, about 1 percentage
point higher than in 2006, the USDA estimates.

Carl Weinberg, chief economist for High Frequency Economics, has warned that
higher food prices could spell trouble for the U.S. economy.

"The trend in food prices did not go well in the 1970s, and we fear that a
repeat of that squeeze is in progress now," he wrote in a note last week.

The USDA estimated this week global grain stockpiles could drop more than 5
percent this year as a result of increased demand and droughts.

Weinberg said the new estimate means there might only be a 53-day supply at
the end of the year compared to the 69.9-day supply just two years ago.

"These stockpiles estimates are as low as they have been since the early
1970s, and that is not good news," he said Thursday. "If food prices jump,
then inflation measures will jump."

An Iowa State University study of the impact ethanol consumption is having
on food prices appears to confirm many of Weinberg's concerns.

The study projects that consumers could wind up spending $47 more per person
annually on food if oil prices remain above $65 a barrel and grain prices
keep rising. Oil closed Thursday at $67.65 a barrel, up $1.39, on the New
York Mercantile Exchange.

On Thursday, Brian Hoops, an analyst with Midwest Market Solutions in
Yankton, S.D., told Bloomberg News that farmers may liquidate hog herds to
avoid paying higher feed costs. Hog prices are up 22 percent this year on
export demand for pork and higher corn costs. Beef prices are only a little
behind; they have risen 16 percent in the past year, reaching a record
$1.02925 a pound on March 12.

Congress is considering legislation that would require a 36 billion-gallon
renewable-fuel standard, nearly four times higher than 7.5 billion-gallon
standard required to be met by 2012. Most experts say that the standard will
be met mainly with increased production of ethanol and biodiesel fuel.

"The problem with government mandates is that they are not responsive to
market signals or problems like drought," said Ray from the meat institute.
"In terms of food prices, near term, we see the problem getting worse, not
better."

/

Maybe the price rise is because of the price of gas going down!

Gregory Morrow wrote:

notbob wrote:

On 2007-06-15, Gregory Morrow wrote:

"Milk, already hovering around $4 a gallon in the Chicago area, could
cost as much as $4.25 a gallon to $4.50 a gallon by September.

Good thing I don't drink/use the stuff.


I use it for coffee and cooking and smoothies but not for straight (as
opposed to gay? hehe) drinking. I use about three quarts of 1% milk
per week...

I have to wonder where they get the "$4 a gallon in the Chicago area"
pricing, I never pay more than $2.50 or so at Walgreen's, they feature
milk as a loss leader (a coupla weeks ago for $1.99 per gallon). Just
picked up 2 half - gallons for $1.29 each at the local stupormarket
(Treasure Island) down the street...

Maybe they are pricing milk at convenience stores or something...

Yogurt's been on sale a lot lately and ice cream seems fairly
reasonable yet...

As for other food prices, chicken and beef have been fairly expensive
for a whiles, pork less so...and I just picked up eggs for $.99 per
dozen at Walgreen's too.

--
Best
Greg
Milk is always over $4 here. I bought a gallon of non-fat today at WalMart
today and it was $5.50.

Milk Prices Chug Toward Record High...

Group: rec.food.cooking Date: Fri, Jun 15, 2007, 8:01pm From:
(winston*winslo)
Gregory Morrow wrote:
notbob wrote:
On 2007-06-15, Gregory Morrow wrote:
"Milk, already hovering around $4 a gallon in the Chicago area, could
cost as much as $4.25 a gallon to $4.50 a gallon by September.
Good thing I don't drink/use the stuff.
I use it for coffee and cooking and smoothies but not for straight (as
opposed to gay? hehe) drinking. I use about three quarts of 1% milk per
week...
I have to wonder where they get the "$4 a gallon in the Chicago area"
pricing, I never pay more than $2.50 or so at Walgreen's, they feature
milk as a loss leader (a coupla weeks ago for $1.99 per gallon). Just
picked up 2 half - gallons for $1.29 each at the local stupormarket
(Treasure Island) down the street...
Maybe they are pricing milk at convenience stores or something...
Yogurt's been on sale a lot lately and ice cream seems fairly reasonable
yet...
As for other food prices, chicken and beef have been fairly expensive
for a whiles, pork less so...and I just picked up eggs for $.99 per
dozen at Walgreen's too.
--
Best
Greg
Milk is always over $4 here. I bought a gallon of non-fat today at
WalMart today and it was $5.50.

Seems everything is higher up north.In St.Pete I shop Walgreens($2.79 a
gallon),and the .99 cent eggs,breakfast sausage and english muffin
specials.I check their coupons every Sunday
Cheers Smitty in St.Pete

(J S) wrote:




Seems everything is higher up north.In St.Pete I shop Walgreens($2.79 a
gallon),and the .99 cent eggs,breakfast sausage and english muffin
specials.I check their coupons every Sunday
Cheers Smitty in St.Pete


I just bought all that stuff at the Walgreen's on the corner here (in
Chicago), in fact a decent chunk of my food budget is spent at Wag's
they alway's have a few good loss leaders...

I always keep a coupla packs of those Brown 'n Serve snausages on
hand, they are good to throw into ramen or soups, etc...

And I've got three cartons of the 99 cent eggs, will come in handy for
4th of July potato salad...

They beat SquallMart all to hell, that's for sure...

--
Best
Greg

winston winslo wrote:


Gregory Morrow wrote:
notbob wrote:

On 2007-06-15, Gregory Morrow wrote:

"Milk, already hovering around $4 a gallon in the Chicago area, could
cost as much as $4.25 a gallon to $4.50 a gallon by September.

Good thing I don't drink/use the stuff.

I use it for coffee and cooking and smoothies but not for straight (as
opposed to gay? hehe) drinking. I use about three quarts of 1% milk
per week...

I have to wonder where they get the "$4 a gallon in the Chicago area"
pricing, I never pay more than $2.50 or so at Walgreen's, they feature
milk as a loss leader (a coupla weeks ago for $1.99 per gallon). Just
picked up 2 half - gallons for $1.29 each at the local stupormarket
(Treasure Island) down the street...

Maybe they are pricing milk at convenience stores or something...

Yogurt's been on sale a lot lately and ice cream seems fairly
reasonable yet...

As for other food prices, chicken and beef have been fairly expensive
for a whiles, pork less so...and I just picked up eggs for $.99 per
dozen at Walgreen's too.

--
Best
Greg

Milk is always over $4 here. I bought a gallon of non-fat today at WalMart
today and it was $5.50


!!!!

Wow, $5.50...

Well, there's another SquallMart myth shot all to hell: that they're
always cheaper...

If you shop around you more often than not can beat SquallMart's
prices on most everything...they have a few loss leaders to attract
the swarming masses but if you noze about you'll see that their prices
are often the same or higher as other places.

'Course in many locales SquallMart is the ONLY game in town. Where my
mom lives (a rural town of 3,000 in downstate Illannoy) a Super
SquallMart is opening this fall. Their grocery department will wipe
out the other two stupormarts in the county...leaving SM the ONLY full
- line grocer in the whole county. Of course it's a sparsely -
populated rural area, what can ya do...


--
Best
Greg

"Gregory Morrow" wrote in message
oups.com...

They beat SquallMart all to hell, that's for sure...

--
Best
Greg


LOL, that's the best name I've ever heard for that place!!! And that's
exactly what it is too!!


Ms P

Milk Prices Chug Toward Record High...

Group: rec.food.cooking Date: Fri, Jun 15, 2007, 9:34pm (EDT-3) From:
(Gregory*Morrow)
(J S) wrote:
Seems everything is higher up north.In St.Pete I shop Walgreens($2.79 a
gallon),and the .99 cent eggs,breakfast sausage and english muffin
specials.I check their coupons every Sunday Cheers Smitty in St.Pete
I just bought all that stuff at the Walgreen's on the corner here (in
Chicago), in fact a decent chunk of my food budget is spent at Wag's
they alway's have a few good loss leaders...
I always keep a coupla packs of those Brown 'n Serve snausages on hand,
they are good to throw into ramen or soups, etc...
And I've got three cartons of the 99 cent eggs, will come in handy for
4th of July potato salad...
They beat SquallMart all to hell, that's for sure...
--
Best
Greg t

Walgreens sure does beat Wmart.I remember when they had thier own
instant coffee label..it was just as good as Maxwell house etc.When it
was discontinud the sold all the 8 ounce jars they had for 88
cents.People were buying cartsfull because there were no limits(me
included).Im a Ramen lover too.great for a quick hunger fix ,with some
veggies thrown in.They do things like that every once in a while,I read
the circulars before I go anywhere else.
Cheers.Smitty

On Jun 15, 8:02 pm, (J S) wrote:
Milk Prices Chug Toward Record High...

Group: rec.food.cooking Date: Fri, Jun 15, 2007, 8:01pm From:
(winston winslo)Gregory Morrow wrote:
notbob wrote:

On 2007-06-15, Gregory Morrow wrote:
"Milk, already hovering around $4 a gallon in the Chicago area, could
cost as much as $4.25 a gallon to $4.50 a gallon by September.
Good thing I don't drink/use the stuff.
I use it for coffee and cooking and smoothies but not for straight (as
opposed to gay? hehe) drinking. I use about three quarts of 1% milk per
week...
I have to wonder where they get the "$4 a gallon in the Chicago area"
pricing, I never pay more than $2.50 or so at Walgreen's, they feature
milk as a loss leader (a coupla weeks ago for $1.99 per gallon). Just
picked up 2 half - gallons for $1.29 each at the local stupormarket
(Treasure Island) down the street...
Maybe they are pricing milk at convenience stores or something...
Yogurt's been on sale a lot lately and ice cream seems fairly reasonable
yet...
As for other food prices, chicken and beef have been fairly expensive
for a whiles, pork less so...and I just picked up eggs for $.99 per
dozen at Walgreen's too.
--
Best
Greg
Milk is always over $4 here. I bought a gallon of non-fat today at
WalMart today and it was $5.50.

Seems everything is higher up north.In St.Pete I shop Walgreens($2.79 a
gallon),and the .99 cent eggs,breakfast sausage and english muffin
specials.I check their coupons every Sunday

Walgreen's does use milk as a loss leader. They do it in at least
several markets.
There are few other places where you can buy gallons of whole milk for
=$2.79 every day. I'm in St. Louis.

Cheers Smitty in St.Pete

--Bryan

Gregory Morrow wrote:

(snip)
'Course in many locales SquallMart is the ONLY game in town. Where my
mom lives (a rural town of 3,000 in downstate Illannoy) a Super
SquallMart is opening this fall. Their grocery department will wipe
out the other two stupormarts in the county...leaving SM the ONLY full
- line grocer in the whole county. Of course it's a sparsely -
populated rural area, what can ya do...


--
Best
Greg
We have three food stores here. Publix, Winn Dixie, and Walmart. On a
overall shopping list Walmart is always cheaper. I stopped a long time ago
going from store to store to try and come up with a cheaper over all bill.

"winston winslo" wrote in message
...
Gregory Morrow wrote:

(snip)
'Course in many locales SquallMart is the ONLY game in town. Where my
mom lives (a rural town of 3,000 in downstate Illannoy) a Super
SquallMart is opening this fall. Their grocery department will wipe
out the other two stupormarts in the county...leaving SM the ONLY full
- line grocer in the whole county. Of course it's a sparsely -
populated rural area, what can ya do...


--
Best
Greg
We have three food stores here. Publix, Winn Dixie, and Walmart. On a
overall shopping list Walmart is always cheaper. I stopped a long time ago
going from store to store to try and come up with a cheaper over all bill.

I have a choice of Walmart and Dillon's for full grocery stores and the
Target here has a limited grocery section. I find that using a combination
of Target and Dillon's I can always beat Walmart.

There are a few things I go to Walmart for because they're radically
cheaper. But the list is dwindling.


Ms P

BOBOBOnoBO wrote:

Walgreen's does use milk as a loss leader. They do it in at least
several markets.
There are few other places where you can buy gallons of whole milk for
=$2.79 every day. I'm in St. Louis.


$1.99/gallon this week, check yer circular (it's also online at
walgreens.com )

--
Best
Greg

Ms P wrote:

"winston winslo" wrote in message

...





Gregory Morrow wrote:

(snip)
'Course in many locales SquallMart is the ONLY game in town. Where my
mom lives (a rural town of 3,000 in downstate Illannoy) a Super
SquallMart is opening this fall. Their grocery department will wipe
out the other two stupormarts in the county...leaving SM the ONLY full
- line grocer in the whole county. Of course it's a sparsely -
populated rural area, what can ya do...

--
Best
Greg
We have three food stores here. Publix, Winn Dixie, and Walmart. On a
overall shopping list Walmart is always cheaper. I stopped a long time ago
going from store to store to try and come up with a cheaper over all bill.

I have a choice of Walmart and Dillon's for full grocery stores and the
Target here has a limited grocery section. I find that using a combination
of Target and Dillon's I can always beat Walmart.

There are a few things I go to Walmart for because they're radically
cheaper. But the list is dwindling.


Kinda like dollar stores, you have to know what things cost to snag
bargains...some items are actually higher than Walgreen's or regular
grocers or wherever.

--
Best
Greg