A NYTimes article says there's a worldwide shortage of milk (they start with New Zealand, which is a big exporter). Rising standards of living mean more demand for milk, rising prices of feed grains because of ethanol mean tighter supply. And of course milk supply is relatively inflexible--you can get a little bump by feeding a bit more and not culling your herd as tightly (at least you could in the old days), but basically you need to raise more calves to heifers, to cows.
Although the sort of dairy farming I grew up with is now gone, it's nice to hear some good news for the industry.
[Update--Marginal Revolution has an interesting discussion in comments. Although no farmers that I saw.]