New organic dairy farmers face market challenges

After taking over the family business, Lidback wanted to make sure the farm was viable for the future. “How are we going to build our farm and our business and hopefully prepare it for the next generation?” she said.

The Lidbacks thought getting into the organic milk market was the way forward, and not only because of the profits. They can make twice as much as conventional dairy farmers. After speaking with consultants from the organic milk industry, the family thought the transition wouldn’t be too difficult. They already follow most of the requirements. “Then we got the call in the fall of 2016 that we wouldn’t be needed,” Lidback said.

“The organic milk market, nationally and internationally, is flooded,” said Stephanie Walsh, an organic certifier with the Northeast Organic Farming Association of Vermont. She says the organic milk market is so flooded farmers are seeing decreases in the amount they are getting paid. “Milk buyers are doing a little supply control.”

There are four organic milk buyers in the state, Stonyfield, DanoneWave, Organic Valley, and Upstate Niagra. These companies sign organic dairy farms to contracts, so the farmer is guaranteed to make a profit after investing in the transition. “The process of getting their dairy animals, their cows, into organic production is a 12-month long process,” Walsh said. “It’s very difficult for a producer who is wishing to transition to organic, for any reason, to do so without a contract because it’s a very expensive process.”

Lidback says one of the reasons it’s so expensive to go organic is the price of feed. She says around six months ago a ton of conventional feed was around $300, whereas a ton of certified organic grain was $600 or more. And it’s not just feed, there are higher costs to keep the cows healthy as antibiotics can’t be used. Organic dairy cows are required to get 30-percent of their feed from pasture, which mean no pesticides are allowed to be used anywhere on the farm. Adding to the expense — they are paid conventional milk prices during the 12-month transition process, even though they are farming organically.

“A lot of farmers have to take out loans to get them through this 12-month period,” Walsh said.

So what’s next for Lidback? She says she will continue to sell her milk as conventional, even though she’s gone mostly organic. “It’s lean times for sure,” she said.

When the organic market opens up again, Lidback says she will be ready. And once the family lands a contract, they’ll take the final steps to get the organic certification. “Supply and demand goes up and down over the years. Even though no milk buyers now, we’re hoping that goes back up again,” she said.

 

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