Advertisement Few people can comprehend what dealing with the extended period of low milk checks has been like for dairy producers.
When the Class III price is less than $11 per hundredweight, it’s costing a family dairy operation $6 to produce that hundredweight of milk.
The best way I’ve heard it explained to the layman was by Bob Lefebvre, executive director of the Minnesota Milk Producers Association, who was quoted in the Minneapolis Star Tribune as saying, “Try to think of it as you’re going to work and you’re paying your employer.”
I love my job, but if I had to start paying my publisher to come in here and be editor of the newspaper, I’d be broke pretty quick. If any ordinary worker starts bleeding money, they can just walk away from the job. Not so with the dairy farmer.
"You don’t just ask the cow to quit milking today," Lefebvre said.
According to the Los Angeles Times, which did an exposé on the plight of dairy farmers on May 29, two California dairy farmers killed themselves in the last six months out of despair over finances.
"We are getting more phone calls and concerns about suicides than ever," said Michael Rosmann, of AgriWellness Inc., a Harlan, Iowa, nonprofit operating mental-health hotlines for farmers in seven Midwestern states.
Sick of the low milk prices, farmers have started to protest, including dumping their milk. In California, milk dumping has become an organized event.
UW-Extension Agent Tim Rehbein said that dairy operators are doing whatever they can to hold on during this “low cycle.” Some have been better prepared than others.
“I’ve talked to lenders and for the most part they are supporting their dairy partner customers with operating loans,” Rehbein said. “The couple few lenders I talked to were very positive about working with dairy producers.”
Then Rehbein said, “But the milk price better start coming back in the next month or two.”
Dan Schreiner, a product specialist with Accelerated Genetics in Westby, said the high price of commodities and the low price of milk have put the squeeze on farmers.
“I think the next three months will be really telling,” Schreiner said. “Something has to give, either commodities will drop or milk will go up. Looking at the late summer futures market, it doesn’t look good for a summer rebound of the milk price.”
Schreiner, who recently took a trip to California and witnessed the problems there, said producers still are largely optimistic.
In states where dairy producing isn’t considered a staple industry, milk prices are being cited as the main reason why dairy farms are closing. In Connecticut, the number of dairy farms has decreased by roughly 37 percent since 2000. There are now just 155 dairies left in that state.
Roger Hoskin, a dairy analyst at the U.S. Department of Agricul-ture’s Economic Research Service said oversupply and dropping export demand are the main reasons for low milk prices.
“Until recently, the U.S. dairy industry was fairly isolated. It isn’t anymore,” Hoskin said in the Farm and Ranch Guide. “Call it globalization, when the export market is strong, they will do well; when the export market is weak, domestic use is not enough.”
How bad is the situation internationally? On Friday, the Dairy Farmers of Great Britain Cooperative, with 1,800 members, went bankrupt. The Australian reports that dairy farmers in that nation will, on average, report significant losses this year.
What’s the only way out of the slump? Create a greater demand for milk.
The Minnesota Milk Producers Association has launched campaigns to sell more dairy, including one with Domino’s Pizza selling "American Legends" pizzas that include 40 percent more cheese.
Fixing the dairy industry woes, unfortunately, isn’t as simple as ordering a pizza.
E-mail Matt Johnson at matt.johnson @lee.net.
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