[mmichaels1970]

Here is a link to the post that discusses the upcoming 9% rise in milk prices. I do think that ethanol is affecting milk prices.

[JamesP81]

I do think that ethanol is affecting milk prices.

Ethanol effects anything that is effected by corn prices, and that list is one hell of a lot longer than most might think.

[Mr. Lucky]

I hate to ruin a good rant, but the price of corn doesn't have as much to do with the cost of milk as you might think. Corn is a comparatively lousy dairy feed, while the by products of ethanol (gluten meal or DDG's ) make an excellent dairy feed. The expansion of the ethanol industry will increase the production of gluten meal and DDG's, thereby increasing the availability of livestock protein feed.

Increases in the cost of high protein feed (such as alfalfa hay) have a much more significant effect on the costs of dairy operations than increases in the price of corn. The anticipated increase in the price of milk this year is an increase based upon a 2006 baseline. In the year 2006, the average all milk price in the United States was $12.90 per cwt, which was a financial disaster for the industry (following upon the year 2005 which was merely a bad year for the industry with the average all milk price at about $15.14 per cwt). The expected increase will bring the wholsale price of milk back to about where it was in 2004, when the price of corn was about $.65 per bushel lower than it is today.