For the first quarter of 2009, shoppers reported the average price for a half-gallon of regular whole milk was $2.16, down 22 cents from the prior quarter. The average price for one gallon of regular whole milk was $3.15, down 67 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 $3.19, down 26 cents from the last quarter and nearly 50 percent higher than the reported retail price for a half-gallon of regular milk ($2.16).

The average price for a half-gallon of organic milk was $3.71, up 1 cent compared to the third quarter and approximately 70 percent higher than the reported retail price for a half-gallon of regular milk ($2.16).

Compared to a year ago (first quarter of 2008), the retail price for regular milk in gallon containers decreased by 17 percent while regular milk in half-gallon containers decreased 10 percent. The average retail price for rBST-free milk dropped about 3 percent in a year’s time. The average retail price for organic milk in half-gallon containers went up and down slightly throughout the year, rising about 2 percent in the first quarter of 2009 compared to a year ago.

“Continued weak demand overseas for U.S. dairy products combined with increased on-farm production are behind the softening retail prices for shredded cheese and whole milk,” said Jim Sartwelle, an AFBF economist.

As retail grocery prices have increased gradually over time, the share of the average food dollar that America’s farm and ranch families receive has dropped.

“Starting in the mid-1970s, farmers received about one-third of consumer retail food expenditures for food eaten at home and away from home, on average. That figure has decreased steadily over time and is now just 19 percent, according to Agriculture Department statistics,” Sartwelle said.