Posted on: Sunday, July 18, 2004
Big Isle dairy farms await price hike
| • | Price controls make milk costly |
By Sean Hao
Advertiser Staff Writer
Big Island farmers, who operate under different milk price-control rules than the rest of the state, have not had an increase in what they get for a gallon of milk in 13 years, and they're not happy.
They get a fixed $2.03 per gallon of drinking milk. Meanwhile, the average retail price for a gallon of whole milk on the Big Island rose from $5.14 in January 2003 to $5.97 last month, according to the state Department of Agriculture.
"I don't know why (prices) are going up on the Big Island because (the processors) are not paying us any more for it," said Ed Boteilho, president for Clover Leaf Dairy in 'Upolu.
He said it's the retailers and the wholesalers who are making money.
Unlike the rest of Hawai'i, the Big Island does not import milk. It produces enough to cover all the demand and then some. Big Island farm prices are set separately from O'ahu because production costs are lower with more grazing land available.
The recent rise in retail prices comes from a price increase by the main processor, Meadow Gold Dairies, and pricing practices of some statewide retailers.
Meadow Gold spokeswoman Jackie Smythe said Meadow Gold's prices to Big Island retailers rose 4 cents in April to cover higher shipping and packaging costs. Some retailers raise and lower retail milk prices on a statewide basis, Smythe added. So the recent rise in O'ahu prices carried over to the Big Island.
Big Island dairy farmers are waiting for state approval of a 25.8-cent-per-gallon increase in what they can charge for milk.
The Board of Agriculture approved the increase in April, but it must be cleared by the Department of Agriculture, the attorney general, the Small Business Revenue Board and the governor. That isn't expected to happen until November.
Bahman Sadeghi, part owner of Foremost and owner of Island Dairy, favors the raise. So does Glenn Muranaka, Meadow Gold president and general manager.
Reach Sean Hao at shao@honoluluadvertiser.com or 525-8093.
