Some worried about higher dairy prices - KCTV5

Some fear higher dairy prices as U.S. nears 'dairy cliff'

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MISSION, KS (KCTV) -

Future trips to the grocery store could get more expensive if Congress doesn't figure out what to do about an old farm bill.

For nearly 38 years Leroy Shatto has worked in the dairy industry churning out milk and cheese products sold within 100 miles of his Osborn, MO, farm. He has dozens of employees responsible for milking about 340 cows twice a day and then bottling the milk for sale.

Shatto likes his work, but he said the financial ebb and flow is starting to take its toll.

"I kept hoping it would get better. The dairy business is the most volatile business there is. Prices go up and down like a roller coaster," he said.

And there's another recent spike. Congress allowed a farm bill to expire in September and has failed to pass a fiscal package which addresses agricultural issues, running the risk of setting into motion a measure that forces the government to buy milk products at an inflated price.

Costs would be passed on to the consumer who could be charged as much as $7 for a gallon of milk.

"Milk consumption's down and, if they do that, exports would really drop," Shatto said.

This comes at a critical time for the dairy farmers. Shatto is paying $60,000 more a month in feed costs than he did last year because of the drought. He has also seen farmers close up shop because of the surging costs.

"Some of the city people don't understand what we go through out here. All they worry about is the price," Shatto said. "Some of them don't even know it comes from a cow, I don't think."

Despite the gridlock in Washington, Shatto remains optimistic that Congress won't let milk prices go over what is now being called a "dairy cliff."

"I don't see them letting that happen," he said.

Congress is working to come up with a deal for the fiscal cliff and it's likely that any deal to avoid the dairy cliff could be attacked to that package - it could also pass as a separate measure.

Like the fiscal cliff, the dairy cliff deadline is Monday.

Click here to read more about the Shatto Milk Company.  

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