According to a University of Connecticut study, consumers who buy milk at chain supermarket stores in the New England area pay nearly $1 more than if they would have bought the same gallon of milk somewhere else.
What’s frustrating, says Ronald Cotterill, economist at the University of Connecticut Food Marketing Policy Center, is that some stores continue to charge high prices for milk, while the nation’s dairy farmers struggle to make a living.
In the study, Cotterill and his team examined 1680 milk prices from 191 stores from 35 firms in four states. They gathered price information from chain supermarkets, convenience stores, whole club stores and limited assortment stores. The survey showed that the average price for a gallon of milk in supermarket chain stores was $3.01 per gallon. Milk prices at club stores averaged 95 cents per gallon less than chain supermarkets and limited assortment store prices averaged $1.09 less per gallon than the chain supermarkets.
The extra dollar that chain supermarkets charge for milk is most definitely not going to producers. “Processors and retailers are getting the dollar, so there’s a very handsome profit margin. There’s no doubt about that,” Cotterill told those attending the Crisis in Dairy Farming Forum held at the University of Connecticut on Tuesday.
However, not everyone agrees with Cotterill’s findings. Grace Nome, president of the Connecticut Food Association, said she was disappointed with the report. It doesn’t take into account all of the costs of doing business at the retail level — labor, transporation cost and others. Food retailers are highly competitive businesses, she said.
Despite her concerns with the report not taking all of the cost factors at the retail level into consideration there is one point within the study with which Nome said she agrees. If something isn’t done soon about low farm prices, there will not be any dairy farms left in New England.
You can view the full report, by clicking on this web address: http://www.sp.uconn.edu/~cotteril/FMktC1.html
Associated Press, The Nashua Telegraph (NH)