When shoppers reach for the butter for their holiday cooking this fall, they won’t
see any good news in the butterfat shortage that has sent prices soaring. But dairy
farmers will, said a University of Georgia economist.

"This is really having a positive effect on butterfat, and therefore milk,
prices," said Bill Thomas, a dairy
economist with the UGA College of Agricultural and
Environmental Sciences. "When I say positive, I mean for the farmers."

In 1997, farmers essentially paid their processors so they could produce milk.
"Georgia dairies have been losing about $1.86 for every 100 pounds of milk they
produce," Thomas said. Each hundredweight equals about 11 gallons of milk.

But as butterfat has become more dear, farmers are finally getting paid more for their
milk.

"As we go into the holiday baking and party season, people will buy more dairy
products that are rich in butterfat: sour cream, butter, cream, rich cheeses," Thomas
said.

Americans use more butter and butterfat-rich products during the winter holidays.
In-home baking, restaurant meals and packaged baking mixes will use lots of butter and
other rich dairy products.

"And that will keep the demand high, supporting prices to farmers," Thomas
said.

Dairy farmers’ payments for milk are based on the butterfat content. The standard is
3.5 percent butterfat per hundredweight of milk. They receive a premium for every
one-tenth percent over that.

Thomas said the premium now is
about three times what it was last year — 32.5 cents now from 10.6 cents in September
1997.

"They’re still not making much," Thomas said of Georgia dairies. "They
are making money but have not recovered from the losses they had over the past several
years."

And as the holidays approach, the weather cools off. That’s more good news for dairy
farmers. During hot weather, cows give less milk that’s less rich. With a carefully
planned diet, farmers can get more and richer milk from their cows.

Thomas said the feeds that can increase butterfat content were in short supply and were
costly through the summer.

"But as prices come down and availability goes up for that feed," he said,
"farmers can increase the butterfat content of their cows’ milk and increase their
income accordingly."

The breed of dairy cows affects butterfat supplies, too. The Dairy Herd Improvement Association has records on
about 60 percent of Georgia’s dairy herd. They test the milk from members’ herds and keep
records on the cows.

Holsteins’ milk has about 3.5 percent butterfat. Jerseys, only 4 percent of Georgia’s
herd, produce milk with about 4.3 percent — almost a quarter again as much butterfat.

"This butterfat shortage might make farmers decide to buy a few Jerseys and
increase the overall butterfat content of their milk," Thomas said. "There is a
tradeoff, though. Jerseys produce less milk volume."

But that decision could pay off in the long run.

"Americans are switching back to butter and butter products," said Connie Crawley, an Extension
Service nutrition and health specialist with the UGA College
of Family and Consumer Sciences.

Sometimes people go back to butter for the taste. And sometimes they switch because of
concerns about trans-fatty acids, which can be high in stick margarine. Crawley said
trans-fatty acids may be as likely to raise blood cholesterol levels as saturated fat.

"Really, the question people need to ask when choosing fats is ‘how often do I use
this product?’" Crawley said.

If you use margarine or butter fairly often, you may want to choose soft or liquid
margarine. These products are lower in trans-fatty acids and have no cholesterol.

If you use butter or margarine rarely or for special holiday recipes, Crawley said she
wouldn’t be too worried about using real butter. "The key here is moderation,"
she said.