Scottie Mayfield, who heads Mayfield Dairy at Athens, Tn., said high fuel prices and increased plastic costs are having an effect on milk prices.
He said Mayfield went up a nickle a gallon at the first of October.
Mr. Mayfield said, "We typically wait some time period before putting a cost increase into effect. In this situation, we probably should have gone up 15 cents."
He said the famed dairy gets 25 percent of its plastic from New Orleans and the rest from Texas. He said at one point just after recent hurricanes it appeared the dairy might run out of plastic.
"We did not bottle orange juice for a day because we wanted to save what plastic we had for milk. But now we are back to getting our plastic supply," he said.
Mr. Mayfield said higher fuel costs that affect milk deliveries are also taking a toll.
Wearing his familiar bow tie, he was the luncheon speaker for the Chattanooga Rotary Club on Thursday at the Convention Center.
He told of his grandfather, T.B. Mayfield Jr., founding the dairy in 1912 with 45 Jersey cows. He built a pasteurizing plant in 1919 and local farmers began bringing their milk to the Mayfields.
Mr. Mayfield said his grandmother, Goldie, for years made Mayfield cottage cheese in her kitchen.
He said the Mayfields got into the ice cream business in 1923. Now they sell ice cream all over the Eastern U.S., though milk sales are not that widespread.
Mr. Mayfield said when Mayfield came into Chattanooga in the mid-1950s there were 22 milk companies and three or four ice cream companies. He said now there are only two milk companies and seven ice cream companies.
He said Mayfield has a committee and also uses votes from visitors to its visitors centers to pick the five new flavors each year. One of the new ones will be Xtreme Moose Tracks.
He said many people do not know that Mayfield was sold in 1990 to Dean Foods. He said it allows much autonomy to the Athens firm.
Mayfield built a new $22 million facility at Braselton, Ga., after it was acquired by Dean.
Mayfield no longer has its own cows at Athens.