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<classification authority="sudocs">GA 1.13:GAO-01-561</classification>
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 <subject>Dairy industry</subject>
 <subject>Dairy products</subject>
 <subject>Marketing</subject>
 <subject>Prices and pricing</subject>
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<titleInfo>
 <title>Dairy Industry: Information on Milk Prices and Changing Market Structure</title>
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<abstract>Each year about 7 billion gallons of fluid drinking milk are
produced in the United States yielding approximately $22 billion 
in annual retail sales. Farmers, cooperatives, wholesale milk	 
processors, and retailers participate in the process of moving	 
milk from the dairy farm to the consumer. Each of these entities 
performs a distinct function in the production, processing,	 
distribution, and sale of milk and each receives a portion of the
retail price of a gallon of milk for the functions they perform. 
Recently, fluid milk prices at the farm-level have fallen	 
sharply, prompting Congress to authorize almost a billion dollars
in the past three years of emergency assistance to dairy farmers 
to help mitigate the effects of low farm-level milk prices. At	 
the same time, fluid milk prices at the retail level have not	 
experienced a similar decline. Consequently, the growing price	 
spread between farm and retail milk prices has raised concerns.  
This report examines (1) factors that influence the price of milk
as it moves from the farm to the consumer, (2) the proportionate 
breakdown of the retail price of a gallon of milk received by	 
farmers, cooperatives, wholesale milk processors, and retailers, 
(3) how changes in farm and retail milk prices affect the	 
farm-to-retail milk price spread, (4) how price changes at any	 
level of the marketing chain relate to changes in price at other 
levels, and (5) the retail prices of the four types of fluid	 
milk--whole, 2-percent (or reduced fat), 1-percent (or low-fat), 
and skim (or fat-free)--in selected markets.</abstract>
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<identifier type="preferred citation">GAO-01-561</identifier>
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 <searchTitle>GAO-01-561; Dairy Industry: Information on Milk Prices and Changing Market Structure;
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<subject>
 <topic>Dairy industry</topic>
 <topic>Dairy products</topic>
 <topic>Marketing</topic>
 <topic>Prices and pricing</topic>
</subject>
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