Barb Dwyer
Literotica Guru
- Joined
- May 30, 2001
- Posts
- 939
Forget global warming. Pitch the Kyoto Protocol. Get over Genoa. This is important news!
Hot, humid and hazy- perfect day for ice cream. Except I come home to read this article.. .
Milk Fat Costs Boost Ice Cream Prices
By JOHN CURRAN .c The Associated Press
OCEAN CITY, N.J. (AP) - For years, you could buy an ice cream cone for 99 cents at Jilly's Ice Cream Factory on Ocean City's Boardwalk.
It was a point of pride for co-owner Jody Levchuk, who held steady on the price while his competitors' prices rose to $2.75 or more. And it helped Jilly's cultivate a following of summer visitors who loved a bargain.
But when milk fat prices recently soared, pride had to give way: A Jilly's cone is now $1.75.
``We caught a little grief from our regulars, because they were so used to the old price. We definitely lost part of our customer count and it hurt our gross, too,'' said Levchuk.
Just when you really, really want an ice cream cone, the price is rising.
The cost of milk fat, the principal ingredient in ice cream, jumped 71 percent over the past six months to $2.22 per pound at the end of June. The industry blames a new government pricing system, while Agriculture Department officials point to a seasonal slowdown in milk production.
As a result, retail prices are up 4 percent from last year, manufacturers say, triggering a 3 percent drop in consumption.
``It's terrible,'' said Janet Friedman, 71, of Margate, N.J., passing up her favorite dessert - Breyer's chocolate ice cream - at a supermarket Wednesday.
``I used to pay $3.99 for a half-gallon. Now it's $4.99. I won't pay that. I'll do without,'' she said, walking away from the ice cream freezer empty-handed.
Dreyer's Grand Ice Cream, Inc., the nation's largest manufacturer, reported a $4.9 million loss in the year's first quarter, despite a 13 percent boost in sales. William Oldenburg, vice president of operations for Oakland, Calif.-based Dreyers, blamed higher production costs stemming directly from milk fat prices.
A new milk pricing system, adopted in a 1996 farm bill, went into effect in January 2000. It was designed to bring uniformity to covenants that determine how much dairy farmers earn. In the process, the government tied the cost of milk fat to the price of butter, which has nearly doubled since then on increased demand. Wholesale butter prices have soared from $1 per pound in March 2000 to $1.90 per pound in May 2001.
USDA economist Donald Blaney attributed the rise to recent studies indicating butter is not as unhealthy as once thought, increasing competition for milk fat by makers of butter, cheese and ice cream.
But at the same time demand was surging, the new rules also created three price classes for milk fat, scaled from butter on the low end, to cheese and ice cream at the high end.
Oldenburg, the Dreyer's official, has lobbied Congress for relief from what he says are unfair and overly-complicated price regulations.
``The analogy I use is this: If I were General Motors and I was buying steel for a Cadillac versus steel for a Chevrolet, I wouldn't pay more for the steel for the Cadillac.
``Yet that's exactly what our pricing system says. You pay more for milk fat that goes into ice cream than you do for milk fat that goes into making cheese,'' Oldenburg said.
U.S. Department of Agriculture officials say there are other factors at work besides the price regulation changes. ``We don't see enough evidence to really make any connection,'' said Agriculture Department spokesman Jerry Redding.
``What you're seeing is dairy supplies are down, compared to last year, and demand is up. Across the board, dairy prices are very high. It's strictly supply and demand. Prices tend to go up in summer, because there's more demand and because cows don't give as much milk in summer because of the heat,'' Redding said.
That means more price hikes may be coming.
Some consumers seem willing to take them in stride. Others say they'll quit eating ice cream until it gets more affordable.
``I can't say it's going to bother me,'' said Dan Reigle, 51, of Philadelphia, digging in to a $3.75 blueberry sundae from Dairy Queen, just down the Boardwalk from Jilly's.
Caroline Burkhardt, 49, of Atlantic City, said she and her family love ice cream, but the recent price increases have forced them to go without.
``Sometimes, I just won't buy it unless I find a good deal. I just pass it up,'' said Burkhardt, who found a half-gallon of Edy's on special for $2.49 and bought it.
AP-NY-07-23-01 1817EDT
If we get so upset about artificially inflated price hikes in retail (refined) gasoline in relation to crude oil costs, then isn't this just as bad? Wouldn't this make ice cream approximately $10/gallon?
(Throwing the political angle out there for those who aren't passionate about just ice cream!)
Hot, humid and hazy- perfect day for ice cream. Except I come home to read this article.. .
Milk Fat Costs Boost Ice Cream Prices
By JOHN CURRAN .c The Associated Press
OCEAN CITY, N.J. (AP) - For years, you could buy an ice cream cone for 99 cents at Jilly's Ice Cream Factory on Ocean City's Boardwalk.
It was a point of pride for co-owner Jody Levchuk, who held steady on the price while his competitors' prices rose to $2.75 or more. And it helped Jilly's cultivate a following of summer visitors who loved a bargain.
But when milk fat prices recently soared, pride had to give way: A Jilly's cone is now $1.75.
``We caught a little grief from our regulars, because they were so used to the old price. We definitely lost part of our customer count and it hurt our gross, too,'' said Levchuk.
Just when you really, really want an ice cream cone, the price is rising.
The cost of milk fat, the principal ingredient in ice cream, jumped 71 percent over the past six months to $2.22 per pound at the end of June. The industry blames a new government pricing system, while Agriculture Department officials point to a seasonal slowdown in milk production.
As a result, retail prices are up 4 percent from last year, manufacturers say, triggering a 3 percent drop in consumption.
``It's terrible,'' said Janet Friedman, 71, of Margate, N.J., passing up her favorite dessert - Breyer's chocolate ice cream - at a supermarket Wednesday.
``I used to pay $3.99 for a half-gallon. Now it's $4.99. I won't pay that. I'll do without,'' she said, walking away from the ice cream freezer empty-handed.
Dreyer's Grand Ice Cream, Inc., the nation's largest manufacturer, reported a $4.9 million loss in the year's first quarter, despite a 13 percent boost in sales. William Oldenburg, vice president of operations for Oakland, Calif.-based Dreyers, blamed higher production costs stemming directly from milk fat prices.
A new milk pricing system, adopted in a 1996 farm bill, went into effect in January 2000. It was designed to bring uniformity to covenants that determine how much dairy farmers earn. In the process, the government tied the cost of milk fat to the price of butter, which has nearly doubled since then on increased demand. Wholesale butter prices have soared from $1 per pound in March 2000 to $1.90 per pound in May 2001.
USDA economist Donald Blaney attributed the rise to recent studies indicating butter is not as unhealthy as once thought, increasing competition for milk fat by makers of butter, cheese and ice cream.
But at the same time demand was surging, the new rules also created three price classes for milk fat, scaled from butter on the low end, to cheese and ice cream at the high end.
Oldenburg, the Dreyer's official, has lobbied Congress for relief from what he says are unfair and overly-complicated price regulations.
``The analogy I use is this: If I were General Motors and I was buying steel for a Cadillac versus steel for a Chevrolet, I wouldn't pay more for the steel for the Cadillac.
``Yet that's exactly what our pricing system says. You pay more for milk fat that goes into ice cream than you do for milk fat that goes into making cheese,'' Oldenburg said.
U.S. Department of Agriculture officials say there are other factors at work besides the price regulation changes. ``We don't see enough evidence to really make any connection,'' said Agriculture Department spokesman Jerry Redding.
``What you're seeing is dairy supplies are down, compared to last year, and demand is up. Across the board, dairy prices are very high. It's strictly supply and demand. Prices tend to go up in summer, because there's more demand and because cows don't give as much milk in summer because of the heat,'' Redding said.
That means more price hikes may be coming.
Some consumers seem willing to take them in stride. Others say they'll quit eating ice cream until it gets more affordable.
``I can't say it's going to bother me,'' said Dan Reigle, 51, of Philadelphia, digging in to a $3.75 blueberry sundae from Dairy Queen, just down the Boardwalk from Jilly's.
Caroline Burkhardt, 49, of Atlantic City, said she and her family love ice cream, but the recent price increases have forced them to go without.
``Sometimes, I just won't buy it unless I find a good deal. I just pass it up,'' said Burkhardt, who found a half-gallon of Edy's on special for $2.49 and bought it.
AP-NY-07-23-01 1817EDT
If we get so upset about artificially inflated price hikes in retail (refined) gasoline in relation to crude oil costs, then isn't this just as bad? Wouldn't this make ice cream approximately $10/gallon?
(Throwing the political angle out there for those who aren't passionate about just ice cream!)
