The latest American Farm Bureau Federation Marketbasket Survey of retail food prices was just released.  In this informal survey, for the third quarter of 2010, shoppers reported the average price for a half-gallon of regular whole milk was $2.04, down 2 cents from the prior quarter. The average price for one gallon of regular whole milk was $3.16, up 10 cents. Comparing per-quart prices, the retail price for whole milk sold in gallon containers was about 25 percent lower compared to half-gallon containers, a typical volume discount long employed by retailers.

The average price for a half-gallon of rbST-free milk was $3.36, down 2 cents from the last quarter, about 65 percent higher than the reported retail price for a half-gallon of regular milk ($2.04).  This price differential (really price gouging) continues the historical trend of dramatically marking up the price of rbST-free milk compared to conventionally-produced milk.  The same “old” ploy of charging a lot more for rbST-free milk that is the same from a composition standpoint as conventionally-produced milk.

In this informal survey, the average price for a half-gallon of organic milk was $3.62, down 3 cents compared to the prior quarter–about 80 percent higher than the reported retail price for a half-gallon of regular milk ($2.04).

Compared to a year ago (third quarter of 2009), the retail price for regular milk in gallon containers was up about 10 percent while regular milk in half-gallon containers increased 8 percent. The average retail price for rST-free milk increased about 1 percent in a year’s time. The average retail price for organic milk in half-gallon containers dropped about 4 percent compared to the prior year.

In April, 2008, I had written a blog Food Costs Increase and the “Smoke and Mirrors” of rbST-Free Milk Marketing Rolls On …and On…and On that discussed how many dairy producers using rbST in their herds were getting cheated by being forced to give up the technology, and, yet, the retailers were selling the milk for considerably more.  The “historical” milk price data presented in the figure below (Source:  American Farm Bureau Federation Marketbasket Survey) show this marketing scheme  (i.e., the differential between the price of rbST-free and “regular” milk) continues.  Astonishing, isn’t it?

Terry D. Etherton

A new scientific study by Vicini et al. published in the July issue of the prestigious Journal of the American Dietetic Association (JADA) reports the results of the first in-depth survey study comparing retail milk for quality, nutritional value and levels of different milk hormones, including bovine somatotropin (bST). The study that we published found that there were “no meaningful differences” in the composition of milk with the three different label claims.

Prompted by the recent trend in misleading food labeling based on dairy cow management, the study looked specifically at three label claims: conventional milk, recombinant bovine somatotropin (rbST)-free milk and organic milk.

While minor differences were observed in milk composition for the three labels, the differences were not “biologically meaningful.” The coauthors of the study concluded that label claims “were not related to any meaningful differences in the milk compositional variables measured.” The only difference among conventional, rbST-free and organic milk is price, according to the study, with milk labeled rbST-free or organic selling for anywhere from $1 to $4 more per gallon than conventional milk.

Because absence-claim labels can imply that the milk labeled rbST-free or organic is safer or better than conventional milk, the published report emphasizes the importance of consumers being mindful about how product labels impact the food they purchase, that purchase decisions should be based on science and not on perceptions created by retail marketing, which can be misleading.

This peer-reviewed paper is important because it will help health care professionals respond effectively to consumer questions and perceptions about different milk-label claims.

Specifically, the study revealed the following:

· Quality: Antibiotics were not detectable in any milk samples. This is a not surprising result since milk containing antibiotics is not permitted to enter the food system. Bacterial counts were less for conventionally labeled milk compared with organic or rbST-free milk, but the differences were small and not significant.

· Nutrient Composition: Protein concentration was greater in organic milk compared to either conventional or rbST-free milk, which both had similar protein content. Again, the difference is not significant, and protein in milk accounts for little of the recommended protein intake for humans. There were no differences in milk fat, lactose or solids among the three label types.

· Hormone Levels: There were no differences in concentration of bST in milk regardless of label type. Concentrations of IGF-1(insulin-like growth factor-1) in milk were similar in conventional and rbST-free-milk, both were slightly higher in comparison to organic milk. Concentration of the steroid hormone progesterone was greater in organic milk compared to conventionally labeled milk or milk labeled rbST-free. Conventionally labeled milk had less estradiol compared to organic and rbST-free milk with concentrations of estradiol in samples labeled organic and rbST-free being the same.

Milk samples for the study were obtained from all 48 contiguous states, though some states did not have rbST-free milk, and some did not have organic milk samples pasteurized by the more conventional, lower-temperature methods. Samples were obtained during a three-week period, and states with larger populations and greater milk production were oversampled.

Reference for the study:

Vicini J, T Etherton, P Kris-Etherton, J Ballam, S Denham, R Staub, D Goldstein, R Cady, M McGrath, & M Lucy. Survey of retail milk composition as affected by label claims regarding farm-management practices. J Am Diet Assoc. 2008;108:1198-1203.

Orion Samuelson is heard on WGN Radio, where he has served as Agribusiness Director since 1960. He and his associate, Max Armstrong, present 15 agricultural/business reports daily on WGN. They also host the hour-long Morning Show and Noon Show, both heard on Saturdays on WGN. Orion is also heard daily on more than 260 radio stations with his syndicated National Farm Report and on 110 stations with his syndicated Samuelson Sez. Orion and Max are seen weekly on rural channel RFD-TV, carried on Dish-TV and DirecTV on This Week in Agribusiness.

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Summary from WHYY: The Pennsylvania Department of Agriculture recently ruled that dairies that do not inject their cattle with synthetic growth hormone can no longer label their milk as hormone-free. The decision, which has been put on hold until the beginning of February, raises serious questions for consumers, dairy farmers, and retailers. We talk to TERRY ETHERTON of Penn State University.

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A common “sound bite” in the arsenal of individuals who oppose rbST use in the dairy industry in the United States is that it is banned in most countries around the world, especially Canada and all the European nations to protect the milk supply. This is inaccurate and misleading. Here are the facts:

The Facts:

No country has a regulatory ban on rbST. Registration of rbST for commercial sale simply has not been completed in many countries.

No country has banned the importation of milk or milk products from the U.S. produced from cows supplemented with rbST (statement by U.S. Dairy Export Council).

There are 20 countries that have a current registration of rbST for commercial sale. Chile is the most recent country to grant registration which was achieved in 2006.

There are 56 counties which have confirmed that rbST use is safe and does not threaten the human food chain, including Canada, and most of the European Union. Confirmation of human safety is the first step in a registration process.

All countries have regulatory agencies similar to the FDA in the United States that must approve pharmaceuticals for commercial sale within those countries.

While there are countries in which rbST has not received registration for commercial sale, the registration process is still open; however in some countries the process has been suspended or blocked, sometimes through a legislative ban, for political or economic reasons.

Economic impact is not usually a reason that can be cited in most countries for denying the grant of a pharmacological registration. Only efficacy, human safety, and animal safety are the key determinants.

Typically, the ploy “questions that need further investigation regarding animal safety” is used to delay or suspend the registration process when there are economic or political considerations.

The economic consideration for countries like Canada and many European nations is their current domestic milk marketing system is based on a quota system which discourages increases in milk production in order to protect the marketplace for producers (see Sidebar section below).

Sidebar:

Numerous United States and international medical, scientific, and regulatory agencies have issued statements supporting and confirming the safety of rbST and that there is no threat to human health by rbST use (the list of agencies is presented below).

Quota Overview:

The primary purpose of a quota marketing system is to keep milk prices artificially high through supply limitation. Quota systems limit competition and therefore reduce the number of producers that exit an industry.

A producer has to own quota for every pound of milk produced in order to market all of their milk under the profitable market prices. Milk not covered by quota can only be marketed at severely discounted prices, making profit impossible for non-quota milk.

Quota is prohibitively expensive to obtain in order to discourage production increases thus discouraging the adoption of technology, farm expansion, and practices that improve production efficiency.

Furthermore quota is a capital asset and can be borrowed against in many countries.

A quota system is difficult to abandon once adopted because vested people and financial institutions with liens against quota value would lose net worth. Consequently, they fight to preserve the status quo. This makes it apparent why the availability of a production-enhancement technology with the impact of rbST would be disruptive to domestic marketplace status quo in countries with a quota system.

Scientific/Medical/Health/Governmental Organizations that have confirmed the Human Safety of milk and meat products from cows supplemented with rbST (list is not inclusive)

• American Cancer Society
• American Council on Science & Health
• American Dietetic Association (ADA)
• American Medical Association (AMA)
• Canadian Animal Health Institute
• Canadian Dietetic Association
• Canadian Institute of Biotechnology
• Canadian Medical Association
• Canadian Network of Toxicology Centres
• Canadian Pediatric Society
• Children’s Nutrition Research Center, Baylor College of Medicine
• Council on Agricultural Science & Technology
• European Union’s Committee for Veterinary Medicinal Products (CVMP)
• Federal Drug Administration (FDA)
• Food & Agriculture Organization of the United Nations (FAO)
• Food & Nutrition Science Alliance
• Food Marketing Institute
• Grocery Manufacturers of America (GMA)
• Health Canada (Royal College of Physicians & Surgeons)
• Institute of Food Technologists (IFT)
• International Dairy Foods Association (IDFA)
• Joint FAO & WHO (World Health Organization) Expert Committee on Food Additives (JECFA)
• National-American Wholesale Grocers’ Association
• National Dairy Council
• National Institutes of Health (NIH)
• The American Academy of Family Physicians Foundation
• Toronto Biotechnology Initiative
• University of California – Berkeley
• University of California – Davis
• U.S. Congress Office of Technology Assessment (OTA)
• U.S. Dairy Export Council
• U.S. Surgeon General’s Office

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This interview took place on November 28, 2007. Rural Route is a one-hour radio show aimed at bridging rural and urban America. Each weekday the program looks at the key issues affecting our nation and explores what they mean for those involved in agriculture and those that derive the benefits of products produced by America’s farmers and ranchers. Rural Route is hosted by Trent Loos, a sixth generation U.S. rancher based in Central Nebraska. Other regular on-air personalities include Kyle Bauer (five days a week), Duane Toews (on Fridays) and Hank Vogler (on Mondays). This way for more information about Trent Loos and Rural Route Radio.

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Dr. Bauman is Liberty Hyde Bailey Professor at Cornell University. This presentation was given recently at the New York Farm Show in Syracuse, NY.