In reply to: Jeash, 3rdst and everyone at “Big Milk” posted by The Holtz Room
Got a fun new dairy client, want to learn their business.
part of the business. The rest of a dairy operates like a normal business. There’s a joke that only five people in the US understand how milk is priced, and four of them are dead.
The attached link is to a discussion of the dairy markets by American Farm Bureau. They recently decided to weigh in on some pricing reforms, and to educate their membership (who are generally crop farmers), they put together some background sheets which are pretty good. That didn’t stop them from recommending some absolute BS reforms, but they at least had the facts mostly correct in their background info.
of milk has collapsed over the last two weeks. But in the end, the farms and Co-ops don’t have much control over the retail price of milk. That’s solely dependent on the bottler and the retailer. Often times, grocery stores will sell gallons of milk below the cost of production to get people into their stores, which then leads to people thinking milk should be every cheaper than it is.
Prairie Farms however is a co-op that bottles and sells directly to retailers. They would have some control over this, and are likely trying to make up losses in the co-op from other product lines by squeezing some margin out of their fluid milk.