Last modified: Monday, March 24, 2008 1:00 AM EDT Milk for sale at Bliss Dairy in Attleboro. MARK STOCKWELL Got cheaper milk? BY TED NESI / SUN CHRONICLE STAFF There is finally a little good news for local consumers struggling with high gas prices and rising inflation. The cost of at least one household staple - milk - has gone down. After hitting a record high of $3.92 last September, the average price for a gallon of whole milk in the Boston area has fallen to $3.85, according to the Department of Agriculture. And 1 percent milk in the Attleboro area has fallen as low as $2.95. But considering that whole milk prices shot up almost 30 percent over the past two years, and the price of milk generally rose 17 percent in the last year alone, the slight decline of the last six months might not offer much consolation. As recently as July 2006, a gallon of whole milk was selling for an average of $2.98 in the Boston area. But prices spiked last summer, jumping from $3.40 in May to $3.90 in July. After decreasing a bit in December, to $3.80, prices crept up 5 cents during the winter. Experts say two factors are mostly to blame for the cost increases. First, there is the growing demand for biofuels like ethanol, which has driven up the cost of the corn that is also used to feed dairy cows. Even more important is the increasing demand for dairy products and other proteins in emerging market countries like China and India. The falling dollar has made it cheaper for them to buy dry milk powder and other products on the Chicago Mercantile Exchange. Although the Agriculture Department is not predicting a price decline this year, officials there are forecasting that an increase in the nation's cow population and a boost in milk output could keep prices steady in 2008. That's also good news for local businesses that depend on a steady supply of milk. "It drastically affected us last year in the cost of making ice cream," said David Bliss, president of Bliss Bros. Dairy in Attleboro. "The milk that goes into it went out of sight." Prices are now falling, Bliss said, because farmers cranked up production when milk started fetching higher prices. "Basically, there's a pretty good supply nationally," he said. Bliss has his fingers crossed now that prices are moderating. "This year it hopes to be more stable," he said. "I don't think we're going to see the kinds of problems we had last summer and last fall." "But," he added, "who knows?" TED NESI can be reached at tnesi@thesunchronicle.com or 508-236-0434.