Consumers Benefit-Producers don't

 In the past few months, Idaho dairy producers have experienced a disaster. Idaho Dairy Commission executive Bob Naerbout has pointed out that milk prices are significantly below production costs and dairymen are being forced to sell off significant numbers of their cattle for beef if not shut down completely. The picture isn’t much happier for beef ranchers since retailers have experienced significant reductions in the numbers of consumers who are buying the better cuts.

 Sadly in life, misfortune on one side often means benefit to another sector…in this case the consumer. American Farm Bureau Economist Jim Sartwelle explains that this is the third consecutive quarter with falling prices to the consumer. “For the third consecutive quarter we saw a decrease in the price of our 16 staple grocery items. It dropped about 2% from the 1^st quarter of 2009 checking in right at $46.29.

As we’ve looked across our market basket, meat, milk and egg items were the ones that decreased the most, both year to year and for the first and second quarter. The percentage of the retail food dollar that farmers get 25 years ago was about a third now it’s less than 20% so as we see these price moves go down at the retail level, we know that the receipts back to farmers are going down.”