FOOD & AGRICULTURE

The sharp drop in milk prices is taking a toll on dairy producers, but Agriculture Department economists say farmers have been slow to reduce output. “Milk prices are dramatically lower than a year earlier and are expected to erode the expansion in milk output as 1991 progresses,� the department’s Economic Research Service said. Milk output per cow in the first quarter of 1991 was up 2% from a year earlier, but high feed costs relative to milk prices are expected to trim this production rate in the second half of the year. Returns to farmers above feed-concentrate costs are expected to drop more than 20% to the lowest level since the late 1970s.