Milk prices slashed in half for Minnesota farmers

"Farm Economy"

02/07/2009

February 7, 2009

New London, Minn. (AP) — Milk prices paid to farmers have fallen by half since last fall. And that means some Minnesota farmers will struggle to break even this year.

Last fall, milk prices peaked at $20 a hundredweight.

There are several reasons for the quick price drop, including overproduction and under-consumption - both domestically and internationally.

European subsidies were also increased, which decreased the demand for American milk products.

Steve Combs and his wife Amy own a 100-head Holstein dairy herd west of New London.

Steve Combs says he expects to be working at a loss for much of the year.