Snowe wants U.S. probe of Northeast milk prices

Sen. Olympia Snowe is calling upon the federal government to investigate milk prices in the Northeast.

Snowe has asked the General Accounting Office in Washington to conduct a study on the discrepancy between retail milk prices and the prices that dairy farmers receive.

Snowe said farmers were receiving $18.81 per hundredweight of milk, about 11.6 gallons, when the Northeast Interstate Dairy Compact price support system expired 18 months ago. Dairy farmers now receive about $13 for the same amount.

While the price farmers get for their milk has fallen sharply, Snowe said retail milk prices have fluctuated only a few cents around $3 per gallon.

“The fact dairy farmers are receiving the lowest price for milk that they have seen in 25 years while consumers continue to pay $3 a gallon for the product suggests that our dairy markets are seriously flawed and unfair to both consumers and farmers,” Snowe said.

Low milk prices have created the most serious crisis in the New England dairy industry in decades. Officials have projected that as many as 10 percent of Maine’s 400 dairy farms could go out of business this spring.

Snowe is asking the General Accounting Office to investigate the change in the retail and farm price of milk since the expiration of the dairy compact in October 2001.

She is also asking investigators to break down the price of a gallon of milk by the amounts received by farmers, cooperatives, processors and retailers 18 months ago and now.