Milk prices could increase early next year

Milk prices may be on the rise in 2013 as New Brunswick farmers are now paying more to feed their cows.

Grain prices climbed 50 per cent over the summer following widespread drought in Canada and the United States.

"It's going to be a struggle," said Reg Perry, who owns a dairy farm near Havelock.

He is facing a long, expensive winter trying to keep his cows fed.

"Their crops are way down and, therefore, there is speculation that it could be scarce, so that's forced prices up," he said.

If Perry has to pay more to feed his cows this winter, consumers will have to pay more to drink their milk.

Steve Michaud, the general manager of the Dairy Farmers of New Brunswick, said increased production costs will inevitably be passed on to the consumer.

"Those increases in costs will affect all kinds of dairy products from fluid milk to cheeses and ice cream and so on," said Michaud.

But it is still unclear by how much, he said.

Milk producers and dairy farmers start price negotiations in November.

Currently, Perry is paid about 76 cents a litre, which is not nearly enough to cover the higher cost of feed.

"I am hoping that, you know, we get enough of a price increase to cover our costs or a portion of our costs," said Perry.

If that happens, consumers will be paying more for a carton of milk after Feb. 1.