WASHINGTON — QUESTION:
Are farmers getting paid less even as retail milk prices go up?
ANSWER:
Yes. Overall, the dairy industry struggles during the pandemic have led to a general rise in retail milk prices, while farmers are getting paid less.
SOURCES:
The U.S. Department of Agriculture
The U.S. Bureau of Labor Statistics
A dairy industry expert at the University of Maryland
PROCESS:
The dairy industry has been hit hard by the coronavirus pandemic, causing a shift in demand and production.
With schools closed, restaurants shuttered, and so many people being home, it changes the type of milk and other products consumers want.
It’s also led to Facebook posts like this – shared thousands of times – which says the price we pay for a gallon of milk has gone up 7.5% while farmers are paid 23% less.
So, the Verify team combed through data from the above sources to determine if farmers are getting paid less even as retail milk prices go up.
First, we have to clarify that dairy farmers do more than just sell milk. Yogurt, cheese, butter, and liquid sales affect the prices at which farmers get paid.
Additionally, when we talked to Dale Johnson, a farm management specialist at the University of Maryland, he highlighted a big issue the industry has been facing for a while now.
“The farmers have been losing at least 10 cents a gallon, or more on milk, and that's been going on for five years and we've actually had a lot of farmers going out of business,” Johnson said.
That statement was part of a larger previous conversation with WUSA9, discussing the overall struggles in the industry because of the coronavirus pandemic.
According to the U.S. Bureau of Labor Statistics, the average retail price for a gallon of milk in April jumped 9.6% from April 2019. That’s $3.27 compared to last year’s $2.98.
Now let’s look at the numbers for farmers. Data from the U.S. Department of Agriculture says the price paid to farmers in May 2020 was down 21.1% compared to May 2019.
That’s a significant difference from just the previous month, where farmers were seeing April payments at 5.6% higher than April 2019.
Ultimately, we can verify – yes. Overall, the dairy industry struggles during the pandemic have led to a general rise in retail milk prices, while farmers are getting paid less.