Farms seek answers to curb dairy crisis

Paul Post

Milk producers are desperately looking for ways out of an economic quagmire that has forced many farms out of business.

The situation is so serious that more than 300 industry members from throughout the U.S. gathered Monday in Albany for a Dairy Summit, sponsored by the Vermont-based Agri-Mark cooperative.

 

The crisis has resulted from a large oversupply of milk, which has driven farm income below the cost of production for a fourth straight year

“We haven’t made any money in a year or two,” said Neil Peck, of Welcome Stock Farm in Northumberland. “We’ve lived off equity. It’s affecting our long-term business plan. A gathering like this helps everyone understand the issues. Whether you belong to Agri-Mark like us, Dairy Farmers of America, or you sell to Stewart’s Shops, it helps you understand the problems each company is having.”

 

“It’s going to take lots of time, patience and positive attitudes to solve the problem,” Peck said.

Welcome Stock Farm, which also specializes in dairy genetics, is large and diverse enough to sustain losses temporarily, but many smaller operations simply can’t survive.

“Dairy farmers are not making a competitive living wage,” said Chris Koval, co-owner of Koval Brothers Farm in Stillwater. “It’s a race against time between now and when there’s no more equity to burn up. There’s no cash flow, no opportunity for people to advance their businesses. They’re just sitting still, waiting for their checks.”

Koval, whose farm sells to Stewart’s Shops, said the industry needs to be more creative in the way it markets milk in the face of competition from a wide variety of other beverage products.

“People aren’t drinking milk the way they used to,” he said. “There’s such a broad selection of choices, it takes a bite out of milk. We’re competing against a hundred other brands that are cheaper.”

In addition to New York and Vermont, the Summit brought together people from Maine to California, along with Wisconsin, Michigan, Florida, New Hampshire, Connecticut, Pennsylvania, plus Canada.

“It’s not just small, it’s not just big, all dairies are suffering,” said Mark McAfee, California Dairy Campaign executive director.

Primarily, oversupply has resulted from farms striving to become more efficient, producing more milk per cow, in the face of declining demand for fluid milk products.

“The problem is, people in this room have been too successful,” said attorney Todd Eskelsen, an industry analyst. “You have produced more and more with less and less.”

A variety of solutions have been proposed, ranging from voluntary cutbacks to a whole new system similar to Canada’s, where dairies must adhere to production quotas.

The goal, from those in attendance, is to reach consensus on a plan that does the most good for everyone involved, and present it to federal officials whose approval is required for meaningful policy change. For example, restoring whole milk to school lunch programs would provide a major market for dairy producers.

“Can you imagine how much that would mean?” said Arden Tewksbury, of the National Family Farm Coalition Dairy Committee. “If we don’t wake up we’re going to lose a whole generation of future milk drinkers in this country. We’d better get on the ball pretty quickly.”

The crisis not only affects farms, but the rural economies and communities they support comprised of feed suppliers, machinery dealers and veterinarians. Tewksbury said state and federal officials should hold hearings “out in the country and give really dairy farmers a chance to tell them what it’s like.”

Paul Post covers NYRA, SPAC, agriculture, Wilton and other local towns, veterans’ issues and more. Reach the author at [email protected]or follow Paul on Twitter: @paulvpost.