Five less dairy farms

Last week 5 dairy farmers sold their cows in my area as they were having a hard time paying the bills with current milk prices. The biggest dairy in my area (sw WI) is for sale. The farms that quit ranged from a 40 cow jersey rotational grazer to 90 some cow operations. I know two of the farmers very well. I know of some others who are thinking of quitting. As someone that milked cows for 20 years it is sad to see others that worked so hard be forced to quit. Tom

I feel the same Tom, I don?t like watching this transition from what we all think of as a family farm. To a farm that is owned by a family, but is basically a large corporate operation, perhaps managed and owned by a family and majority of the work done by employees. Vertical integration of processing and retail will keep adding fuel to this change.Two farmers that I know sold out last week.

Same up here. Farms going out all over the place. Low prices, high costs and taxes, farmers getting older. I don't know where it's going to end up.

Sad all the way around. If it were not for cheese and ice cream the demand would be far less than what it is. In my area it will be interesting to see the impact on the Amish and Mennonites. They were buying ground that was poor in quality for growing row crops hence they raised livestock with most running a dairy. The talk is that even they see very bleak times ahead. I think that in the future at least around here you will see marginal land go unfarmed as the economic return will not be there for even the most efficient or well heeled.

It is the Walmart way, bigger forced littler out.

I don't like it, but nothing you can do.

I hate "progress " At 69 years old there has been so much change it sickens me. There is a piece of what was a farm in town. When I was a really little kid they went out of farming maybe 1954. Eventually by the mid 60s it was "developed" Small stores, then a small multi screen theater, and now a bank. Big famouse and once busy landmarks are abandoned, falling down, or in total disrepair, or just gone. Ticky tacky cardboard houses etc.

Ok Ok, I am going to ask the question that's been on my mind for some time, that I was concerned would create a firestorm of controversy. Why are milk prices so low? Personally my wife and I average a gallon + each, a week. School lunch programs always had milk. School me you dairy farmers. Other than considering price supports by USDA please leave the politics out of our discussion. gobble

(quoted from post at 09:13:28 08/19/19) Ok Ok, I am going to ask the question that's been on my mind for some time, that I was concerned would create a firestorm of controversy. Why are milk prices so low? Personally my wife and I average a gallon + each, a week. School lunch programs always had milk. School me you dairy farmers. Other than considering price supports by USDA please leave the politics out of our discussion. gobble

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Tom, I am not a dairy farmer, but I think that a lot of it is as regularly stated here on YT. Milk production exceeds demand, prices drop, farmers sell out. Milk production then drops below demand, prices go up, farmers buy and milk more cows. Milk production exceeds demand, prices drop. And on and on. Everyone wants to farm.

Tomturkey. Showcrop is pretty much there. I beleive the talking heads say the country can support about 9 million cows and we are milking more than that so we are floating on a sea of milk. I would not be surprised to see the 9 million go lower as I just am not able to see milk demand going up with all the market demand factors blowing the wrong way..............lactose intolerance whether real or imagined, soy, almond foo-foo alternatives, PETA crap, folks from other countries that dont drink milk, blah blah. This 'down" cycle may well last a while due to stagnant to decreasing demand.

There are many reasons.

Walmart will be blamed, they are putting together their own dairy supplier, it?s complicated but they quit buying from the market and are buying through one large milk operation. It?s easy to hate on a big company, but they have their reasons for going this route too. The trouble is that they stopped buying a whole lot of milk from established places, and started buying milk from newly built dairies for the new operator. This means way too many dairy operions around.....

Folk found out if they get bigger and keep expanding they can produce milk a little cheaper and play with lots of money and look big. It works for a while, and milk gets cheaper, and so everyone is happy until it falls apart. Anyhow, it?s more profitable to have 9000 cows under you on 3-4 dairy locations and have very cheap labor do the milking. This gets us into the illegal immigrant politics.

Lot of kids want to follow their folks and farm; including dairy. What was a 40 cow dairy for dad, got expanded to a 120 cow dairy for dad, Jr, and the grand kid. They are looking at putting up a 400 cow dairy so the grand kid has something to work at..... this is, basically, the same as the Walmart deal, only 1000 little deals, instead of one big one....

Several places decided the only way to make it is brand identification, and they make their own milk, cheese, etc. control the milk from cow to kitchen table and make money from every step, small scale. The problem is the 40 cow dairy doesn?t do well at this; they need to be big enough to get shelf space as a store or cover the cost of all the govt regulations, and so soon they become the 10,000 cow setups that supply Mille to a several state region, calling themselves the mom and pop dairy with down home values. It?s business, they need to get market share to sell their product and cover costs, they end up all being exactly like the Walmart deal.....

Along the way, everyone wants to get more efficient to pay the bills, so we learn how to produce more milk per cow, per acre of silage, per gallon of water.... the 40 or 120 or 400 or 3000 head dairy part is producing way more milk per cow then they used to.

So the real short answer: more people want to be dairy farmers than there are people wanting to drink milk. The small places got way more efficient, the big places got way more cheaper cost of production. One makes a lot more milk, the other make ps a lot cheaper milk, together we get flooded with cheap milk.

Paul

I see many words, by many people, but absent government interference, milk will be the same as anything else, price is a result of supply & demand. Really simple.

I thought it was only organic farming operations that went broke? Fact is supply what consumers demand and are willing to pay for or fall by the wayside has always been
true and always will be.Ranting and raving about organics or anything else consumers want to pay for will not pay the bills.

My county has three fairly-large dairy farms. I personally know the managers of two of them. Both claim they are making no money, but yet these two will be increasing their numbers by about ten thousand cows within two years. Doesn?t make sense in my book, but I don?t do their books.

Basic Farmernomics 101 if something isn't selling and there is a huge surplus,to solve the problem produce more next year.

Someone mentioned that the demand for milk has dropped, and I suspect maybe it has. And for a variety of health reasons apparently (even though it has a lot of benefits). I drink milk now and then as a drink, I have it on my cereal, etc. My wife doesn't drink it. One of my kids develops severe nasal plugging and stuffiness if he drinks milk so he hasn't done that for years. Here's an interesting link below, and not terribly biased one way or the other ...
Untitled URL Link

Around ten years ago Central Minnesota dairy farms went through the same type of consolidation. At that time high corn prices and high farm land rent made it more profitable to switch to cash grain or cash rent for more money and far less work.

Milk production is still expanding, not contracting, even with the loss of many small producers. Investment seems to be is growing in larger, more efficient dairies that can produce better quality milk at lower cost. One single location 3000 cow dairy farm can easily replace fifty 60 cow small independent dairy farms.

Unlike grain farming or beef production, hobby farming and part-time farming do not seem to mix well with dairy production. There just isn't much demand for milk from small farms anymore. Cost of production and uncertain quality could be some of the reasons.

In the Omaha, NE area Walmart sells Kemps brand milk for $3.17/gallon right next to Great Value brand milk for $1.57/gallon. Aldi sells whole milk, 2 percent milk and skim milk all for the same $1.53/gallon price. Very few people leave those store with only milk in their shopping carts.

You don't have it quite wright. Price goes down and gross income goes down. Only way
to bring up gross income to cover debt load is to make more milk---Add more cows.
Farmers are their own worst enemies. ------Loren

When I moved to this area (central Kansas a little north of Wichita) 20+ years ago there were at least 6 or 7 dairies in the county. By industry standards all were small, a few hundred cows or less. Now there are only two remaining and one of those is looking to get out as soon as possible. Like it is with many industries, production is shifting towards the large-scale operations that can invest in technology to do things at a lower cost. I toured a "milk factory" in California about ten years ago that milked thousands of cows on an automated 72-head carousel system. For the number of cows milked per hour there were very few people were involved in the process - a couple to herd the cows into the milking barn, one to clean the udders, one to attach the milkers, and a couple more to get the cows back into the right pens. The milkers dropped off automatically when the udder ran dry and a strategically-placed water jet caused the cows to step off the carousel by themselves. Milking was going on around the clock seven days a week. It is obvious that such a system will produce milk at a lower cost per gallon than the little guy doing 100 head. Yes, the technology is expensive but when amortized over thousands of cows it pays back. It is all about the economy of scale.

Id been happy with dollar a gallon milk. But those thin plastic jugs cost a lot.
When i milked i started with mid am,dam crooks. Then i went to kraft general foods bentonville,arkansas.made more money but never was enough for the work put in and the initial investment

https://www.youtube.com/watch?v=VUoXtddNPAM&list=RDVUoXtddNPAM&index=1

We have one of the mega dairy farms in our township, believe they milk around 3000 head, have to say, We all hate the place, they destroy the roads with the constant oversized feed, poop, and milk haulers, and there is not a damned thing anyone can do about it. How is it the Manure Haulers who have Huge equipment, and are not farmers, they are commercial haulers, yet they are unlicensed, ignore speed and weight limits, destroy roads, and pay nothing. Residents are upset, and who wouldn't be, the dust and the ruts are insane. Something has to change with these haulers, 12 year olds running rigs that are insane in size and they are going 50 plus all the time.

Are the big milk producers "milking the government" like the big farmers? Just asking!