Dairy farmers are worried about losing their businesses and land if milk futures continue in a downward spiral throughout 2015. In some places in the United States a gallon of milk can now reportedly be purchased for less than $3 per gallon. Milk sales boomed and hit a record high in 2014, but now some agricultural experts are predicting a milk bust in 2015. Dairy farmers are pouring milk down the drain as milk prices plummet. Global overproduction of milk is largely being blamed for the anticipated milk bust. If farmers go under due to the steep drop in prices, what does that mean for the security of the American food supply?
Because there is an excess of milk on the global market, the prices for eggs, butter, and milk continue to drop. Dairy market predictions are not looking good for 2014, according to dairy farmers and association group leaders. Milk prices are predicted to drop even further through the spring, approximately $13.50 per hundredweight in March.The national dairy marketing co-op, Dairy Farmers of America, a has begun to charge its 15,000 members 50 cents per hundredweight in an effort to account for additional transportation fees and low prices.
Do you have enough long term storage milk on hand?
The last three years have reportedly amounted to a roller coaster ride for dairy farmers. Many of the men and women who produce the milk, eggs, and butter which fill grocery store shelves readily recall 2009 with “dread.” During that year dairy prices dropped significantly and some farmers were forced to sell off parts of their herd.
If prices continue to dwindle, Wisconsin dairy farmer Rick Steger says his income will decrease by a third – at least. “I’m very worried because it’s such an extreme drop,” said Steger. “Our expenses aren’t going to drop.”
Wisconsin-based Family First Dairy Cooperative Director Norbett Hardtke said that dairy farmers respond to global demand when working their cows. When demand is high dairy farmers milk more from each cow and expend their herds when prices jump to record highs – resulting in an oversaturated market, according to Hardtke.
China has reportedly decreased milk imports from American farmers after spending many years creating a powdered milk stockpile. The change in purchasing habits came after Russian trade with the United States came to a grinding halt.
— Ohio Dairy Farmers (@OHDairyFarmers) January 16, 2015
Grocery store shoppers are delighting in the low milk prices, but dairy farmers are reportedly being forced to tighten their belts. “I guess I’m sorry if I’m hurting the farmer or the middleman, but I’m certainly delighted to pay under $3 per gallon,” Madison, Wisconsin shopper Michel Kleinhenz said. The cost of maintaining a herd increases during winter months when hay bales and bags of feed must because grazing the livestock is not an option.
While milk prices may be low now, the cost-per-gallon could ultimately increase substantially to make up for losses sustained when the milk market stabilizes. The savings accrued now could not only leave wallets lighter when purchasing milk, cheese, and other dairy products in the future, but could leave the country with fewer farmers attempting to feed the masses in coming years.
During the milk boom, many dairy farmers reportedly purchased now only more cows, but expensive new equipment in order to meet the demand. Every state in the republic reportedly has some type of dairy production. When farms do not make money, local economies can struggle from the loss of cash not only from those who work the land, but for workers in auxiliary businesses and through a decrease in funding for local essential agencies funded via tax levies.
“It’s something that no farmer likes to do [pouring milk down the drain] it doesn’t feel good to just dup it out, New York-based Northeast Dairy Producers Association Board Director Jon Greenwood said.
Farming is on the decline in America, a fact which has some agriculture industry experts very concerned. The rich traditions fostered on a family farm are disappearing at a rather alarming rate. The aging population of both farmers and ranchers, coupled with a decline in interest in the food-giving industry could spell disaster on a global scale. Farming could become one of the most profitable careers over the course of the next 20 years; but only if more young people opt to enter the agriculture industry. A recent farming report revealed that the average age of the American farmer is 58. The physically demanding agriculture industry must attract a new generation of leaders in order to thrive, according to analyst Jesse Colombo.
The industry expert also maintained in the report about the crop and ranching industry, that farmland prices are extremely low at the moment. Colombo firmly believes that more college students should be studying agriculture instead of business if they want to become highly successful in the near future. If Jesse Colombo’s predictions are accurate, farming regions could indeed become the “New Manhattans” as far as profit is concerned.
Every American farmer now feeds approximately 150 people not only in the United States, but around the globe. There are far fewer agriculture workers involved in crop and livestock production today than during the 1960s, and they are responsible for putting food on far more tables.
Although many modern family farms are incorporated businesses, they are largely still run by real people and not mammoth corporations. Today, many farmers and ranchers use the latest technology to grow and harvest the food which ultimately winds up on our store shelves or at local farmers’ markets. Many American farmers have college degrees and like many of us, attend continuing education workshops to perfect our skills.
There is much debate about “Big Ag” or industrialized farming and ranching habits as opposed to a more traditional manner of farming. Regardless of how a farmer or rancher decides to run a business, one fact remains the same – without them, our lives would be drastically more difficult.
Those of us who live in rural areas surely have the space to grow our own food, but perhaps not the skills or the time. Supplementing store-bought food with a backyard, urban, or full-size garden is becoming more commonplace and a very responsible practice. But, until we can all grow everything we need to survive, we need to prepared for a day when grocery store shelves could become empty within just a few hours. If a disaster occurred, would you have enough long term storage food on hand to supplement what you were already growing to feed your family>