Cows head to the barn for milking at Highland Farm, in Portsmouth. The farm has 80 milking cows that are milked twice a day.

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The Providence Journal / Steve Szydlowski

Consumers grousing about the high cost of food have more to grumble about as milk prices are likely to go up — again.

Milk prices hit a record a year ago, when Americans paid an average of $3.80 a gallon, and have stayed high ever since.

By January, the cost of a gallon of milk rose to $3.87 a gallon, according to the Bureau of Labor Statistics, up more than 36 percent from last year. Prices vary widely in Rhode Island and Southeastern Massachusetts. Over the holiday weekend, the cost of a gallon of milk ranged from $3.29 to $4.79 at some stores in and around Providence.

The price Americans pay for milk is expected to go up again this month because the U.S. Department of Agriculture recently reset the base price dairies and food processors pay to farmers. That will raise the cost of a gallon of milk an undetermined amount.

One of the biggest reasons for the price increases is the increasing cost of crude oil and gasoline, which affects the entire dairy food chain: the farmer who tends the cows, the trucker who transports the milk, the dairy that processes and packages it and the stores that sell it.

The prices paid for corn and grain used to feed cows, the fertilizers used in growing feed, diesel fuel for the trucks and electricity and natural gas for the farms, dairies and stores have all spiked because of rising energy prices, especially crude.

Crude oil for August delivery last week hit a record $145.85 a barrel on the New York Mercantile Exchange before dropping to $136.04 by yesterday afternoon. Crude oil is up 36.5 percent since Jan. 2.

Retail gasoline prices held steady yesterday at a record $4.108 a gallon for regular, according to AAA.

In Rhode Island last week, the average price of regular, self-serve gasoline was $4.11 a gallon, an increase of $1.17, or 40 percent, over last year’s price of $2.938 a gallon.

“We’re no different than any other business, everything we use and everything we ship is being affected by the high price of fuel,” said Louis Escobar, a Portsmouth dairy farmer and president of the Rhode Island Dairy Farms Cooperative. “The price of milk hasn’t doubled, but the price of fuel has doubled.”

Dairy and food businesses are hesitant to pass along the full cost of the oil price spike, fearing that consumers will cut back their buying as shelf prices rise.

Milk prices are based on the price of raw milk, which is divided into four classes: Class I is fluid milk, Class II contains “soft” products such as ice cream, sour cream and cottage cheese, Class III refers to milk used for making hard cheese, and Class IV is milk used to make butter and nonfat dry milk, according to the International Dairy Foods Association. Twice a month, the federal government calculates prices for each class and the minimum price received by the farmer is a blend of these prices.

The prices are volatile, industry members say, determined largely by supply and demand, but also affected in part by the Chicago Mercantile Exchange, where dairy products are traded as commodities. Based on those production and price fluctuations, the government twice monthly recalculates the minimum price the dairy food processors have to pay farmers for milk.

The U.S. Department of Agriculture last month set that base price for fluid milk at $20.78 per 100 pounds, or “hundredweight,” up 14.3 percent from the previous month. There are about 11.6 gallons of milk in a hundredweight.

The base price varies some-what from region to region.

Agri-Mark, a cooperative of 1,300 dairy farms in New Eng-land and New York, expects the blended price to settle out at $21.20 for July in the New England market, about 40 cents higher than the USDA’s recent national benchmark.

Escobar is one of the five farmers who are part of the Rhode Island Dairy Farms Cooperative — the producers of Rhody Fresh milk. The farmers ship their milk to a Connecticut processing plant, where it is packaged in cartons unique to the cooperative and sold in stores around the state.

Escobar has 85 milking cows on his 98-acre Highland Farm in Portsmouth. The cows produce about 500 gallons of milk a day.

He recently was getting about $18.50 per hundredweight of milk. That works out to about $1.59 a gallon for the farmer. If the price rises to $21.20, Escobar would get about $1.82 a gallon, according to an Agri-Mark spokesman.

Both prices are far below the $4-and-change a gallon that milk sells for in some stores.

Meanwhile, the cost to run a dairy farm continues to rise.

Escobar uses wet brewer’s grain to feed his cows, a byproduct of beer-making, to help keep down his costs.

Other farmers try different ways to save money.

Barry James, of Tomaquag Valley Farm, is both a member of the Rhode Island Dairy Farms Cooperative and a milk trucker.

The James family farm in Hopkinton is run by his son and nephews. The family has about 140 cows — 75 of them milking cows.

“The farm end, we’re really getting hit hard,” he said.

Grain for the cows is now $350 a ton, up from $100 a ton a year ago. Fertilizer needed to grow corn used as feed costs more than $700 a ton, up from $500 last year.

The James family is using chicken manure as fertilizer to help cut costs. Even that option is getting harder to use.

“That’s getting tough to get because everybody wants it,” he said.

While the younger generation tends the farm, James oversees Tomaquag Valley Milk Transportation. The trucking company puts eight tanker trucks on the road daily, delivering milk from farms in Rhode Island and Southeastern Massachusetts to dairies run by Garelick, Guida, Munroe and other companies. On average, his trucks transport 55,000 gallons of milk a day from farms to processors.

The trucks are capable of carrying up to 7,000 gallons each, but get barely five miles per gallon as they haul milk to processors in Rhode Island, Massachusetts and Connecticut.

He spends more than $40,000 a month on fuel for his trucks, up from about $30,000 a year ago.

“The fuel charges are passed on to the farmer,” James said. “But if we affect the farmer too much, it’ll affect us, because they’ll go out of business.”

The trucks are serviced every 15,000 miles, getting 11 gallons of fresh motor oil each time.

Motor oil prices, tires and antifreeze are more expensive than they were last year, he said.

“All these little things add up,” he said.

Still, James has no interest in hauling other, perhaps more profitable, products, he said.

“We’ve considering other things,” he said. “But this is what we know.”

Tomaquag’s trucks deliver some of the milk they carry to Munroe Dairy in East Providence.

A family-run operation, Munroe takes in about 22,000 gallons of milk a week, processes it and delivers it to homes in and around Rhode Island on 29 delivery trucks. The milk delivered in Munroe’s trademark half-gallon glass bottles was selling for $2.98 last week.

“Because we do home delivery, we can get a little bit of a premium,” said Rob Armstrong, Munroe’s owner. “Our margins are pretty slim.”

Munroe’s trucks make 70 to 80 deliveries a day each, burning through more than 30 gallons of diesel fuel along the way. The fleet uses about 1,600 gallons of diesel fuel weekly. The monthly diesel cost is about $30,000.

A year ago, the bill was “not quite half that,” Armstrong said.

“We’ve had to bump up the delivery charge 20 cents because of the cost of fuel,” he said.

It’s now $1.65 per delivery.

He’s also paying more for the natural gas and electricity needed to run his plant. The bill from supplier National Grid now runs about $20,000 monthly.

He’s kept the price he charges for milk steady even as costs rise.

“We’ve been holding to that price for quite awhile,” he said. “We’re reluctant about passing too much on to the customer.”

It’s not all bad news for Armstrong. Munroe now delivers to about 12,000 homes a week, up about 700 from a year ago. The growth has come even as consumer spending weakened nationally.

Armstrong attributed the increase to people who moved into new housing developments in previously rural sections of Rhode Island, such as South County.

“It’s probably because of the distance to the stores,” he said.

pgrimald@projo.com