Milk prices may be rising

By Alyssa Donovan

December 29, 2012 Updated Dec 31, 2012 at 10:55 AM CDT

DOWNS, Ill.-- As time winds down for Congress to keep America from nose-diving over the fiscal cliff, lawmakers are working to prevent another hit our wallets.

Dairy farms across the U.S. might have to raise milk prices at the beginning of the new year. That's because farmers across the country are dealing with the expiring farm bill.

Jim Fraley of the Illinois Farm Bureau says, "Between state taxes, between farm bill, a lot of questions have been unanswered here at the end of the year. And that's what's frustrating many farmers is that they are trying to plan ahead and are unable to do so."

"We have a noble and worthy cause. We make a food product for the American people that's locally produced and wholesome and quality," said Dairy farmer Richard Streutker. "Yet, I think the politicians have a huge disconnect with what's going on on the family farm."

Without a farm bill, milk prices will go up with inflation.

This would cause the country to revert back to the 1949 Agricultural Act known as the "permanent farm bill."

Fraley said, "It would make the government come in and purchase milk at a certain price level which according to today's prices basically would be twice as much as what current prices are today."

Streutker said, "Doesn't hurt my bottom line. Helps me out quite a bit because this year we've been pretty revenue starved on the dairy farm."

But in the long run, the Illinois Farm Bureau says the industry would suffer.

"In the long term farmers realize consumers are going to back off milk prices and dairy product purchases because of the high prices;in the long-term it's not going to be good for agriculture," said Fraley.

Farmers like Streutker are hoping congress extends the farm bill's expiration date, before milk prices turn sour.

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