The situation for dairy farmers is “about as bad as it’s been,” according to Sunderland farmer Bob Williams. And for an industry that’s struggled for years with complicated constraints on making and selling milk, that’s really bad.
The combination of low prices paid to dairy farmers, increased global competition, reduced consumption because of soy, almond and rice-derived beverages as well as upstarts like Coca-Cola’s “Fairlife” prompted a media conference call Wednesday on “real solutions” to the U.S. dairy crisis, including a Canadian-style supply management system.
“What’s happening is not acceptable,” said Patty Lovera, policy director of Food and Water Watch, one of five panelists who spoke about the need for solutions to address historic low milk prices and increasing industry concentration — forcing family dairy farmers to leave farming, go bankrupt and, in some cases, commit suicide.
What had been tremendous volatility and the lack of predictability for farmers to plan, Lovera said, has been replaced by a “very steady downward, permanent trend in prices. … The prices are reaching a crisis point for farmers in terms of what they can sustain after years and years and years of low prices. There’s really not a safety net coming from our federal farm policy, and people have been doing it on their own. And that’s coming to a head.”
She called for “common sense” policy responses that will actually address the root causes, including supply management. “It seems like we’re starting to have some baby steps to have that conversation again in the United States” instead of more loans and a dairy insurance program she said “has not worked.”
Lovera said a supply management policy is “absolutely necessary. There will be pushback on it; there’s a lot of hostility to these concepts of supply management coming from a lot of directions, but what is happening now isn’t acceptable. The destruction from letting these prices just free-fall for long in a system that is so geared toward overproduction is having really destructive consequences on individual farm families and also on whole sections of the country and their rural economies. It’s past time to start having this conversation because the status quo is not working for anybody except the largest players in these industries.”
Northeast Organic Dairy Producers Association Executive Director Ed Maltby of Deerfield told the session that even organic milk — which was seen as “a bright spot” for dairy farming — isn’t immune from the surplus milk problems of conventional farmers. Milk processing companies seized on buying farms and converting conventional ones when there was a shortage of milk in 2012 to 2014, flooding the market and dropping the price paid to farmers by 25 percent “almost overnight.”
Maltby agreed with others on the call, sponsored by the National Family Farm Coalition and Family Farm Defenders that a supply management solution should be considered.
“I think for both conventional and organic, the time is right to do it,” he said. “Unfortunately, the power over what happens in the national cooperatives and the national policy arena is in the hands of the large-scale dairies, who control vast volumes of milk. The challenge here is a more political one to give some leverage back to the ordinary family farm.”
Although he was not part of the call, Bob Gray, executive director of Northeast Dairy Cooperatives, said among the dairy farmers who are hurting most are those with farms of less than 200 cattle.
Gray said part of the problem with dairy is from the global market, including Canada’s halt in purchasing unfiltered high-protein milk from this country.
But Lovera, in the call, said, “We need to fix our dairy system here and let Canada have a dairy system that works for them.”
Local farmers weigh in
Although they weren’t on Wednesday’s conference call — they were too busy laboring on their farms — area farmers conceded that the seriousness of the problems is all too real.
“Everybody’s just hunkering down,” says Angie Facey of Bree-Z-Knoll Farm in Leyden, a member of the Our Family Farms marketing cooperative. “The state tax credit” (which legislators are working to increase) and Our Family Farms are the only things keeping our farm going.”
“I know a lot of people are concerned and talking about it,” Facey said when asked about farmers in the area who are considering selling out. But Facey, whose farm plans to reduce its 160 milking herd by about 60 over the next couple of months, says she doesn’t know anyone who’s sold out.
The entire system, including the move of herds to feed on pasture, tends to encourage overproduction, which further hurts farmers by lowering prices.
The price paid to farmers, which rose slightly in April to a little over $15 per dozen-gallon hundredweight, is “still way below” the cost of production, she said — roughly $18 to $20.
The state dairy tax credit, which Rep. Stephen Kulik, D-Mass., has been trying to double from a $4 million program, has been increased to $6 million in the proposed House budget. He said he hopes to see that at least a $6 million credit program is included in the Senate budget, due for release today.
Meanwhile, farmers have until June 1 to apply for a revised federal Margin Protection Program, an insurance policy that has been revised and may result in payouts to farmers for several months of this year, Facey said. She added, “It looks like at least it will be more than what we’re putting into it. But so many people got burned the last time, they don’t even want to listen about the new program.”
Gray, too, acknowledged, “There’s very little light at the end of the tunnel right now. It’s a complicated situation, but we just have to do everything we can do to try to bring that price up as fast as we can. (The farmers are) at the bottom, trying to cut costs, trying to hang on and do everything they can do. They’re very resilient people, but can only take so much.”
Sunderland farmer Williams, who milks 95 cows, said, “You can’t keep losing money year after year. It’s not going to work. You’re using up your equity.
“If one bad thing happens, you’re gone,” he added. “That’s the scary part. We’re looking for an upturn. I’d say that it can’t do anything else, but I don’t want to say that.”
By: RICHIE DAVIS