|
Loss of production booster could boost prices instead
|
|
Consumers may not notice the difference—except in the price of milk—but Hoosier dairy farmers are learning how to operate without a milk production technology that helped make even smaller dairy farms profitable.
Several retailers are now marketing their store brand milk as coming from cows not treated with recombinant bovine somat-otropin, or rbST, a hormone that boosts milk production.
Consumers will likely pay more for milk without the hormone. How much more might depend on local competition and retailer marketing strategies. “Even though the milk is more expensive to produce, retailers may sell the rbST-free milk at a lower profit initially in order to get customers used to the product,” says Corinne Alexander, a Purdue University agricultural economist. “Longer term, whether the retailer can charge a higher price depends on their customers’ preferences and what the local competition charges for milk.”
Without the use of rbST, dairy producers expect to lose money, and, for some, it may cause them to go out of business, says Michael Schutz, Purdue Extension dairy specialist. “rbST was kind of an equalizer for farmers with smaller herds. It helped their operations be profitable.”
When the FDA approved the biotech-derived growth hormone in 1993, it was determined that rbST does not pose a human health risk based on a review of research. However, animal welfare groups have supported the rbST-free movement, objecting to injecting cattle with the hormone.
|
