Spilled milk: Without concerted support, local dairy farms may soon be a thing of the past

It thrived and persevered even when many thought market forces would push it out. Eventually, though, it became apparent the store’s days were numbered, for reasons its owners had no control over.

We wonder if that same writing is on the wall for the small, family-run dairy farm. The background dynamic might be different — video rentals fell victim to evolving technology and consumer habits, while the stress on dairy farms is one of market forces — but as was the case with Video Headquarters, the iconic family dairy farms once so plentiful here are either disappearing or finding themselves scrambling to adapt to niche markets.

Last week, we detailed the auction of more than 1,100 dairy cows that were the property of Stoneholm Farm in Putney, Vt. That farm is being sold, piecemeal, after generations of operation in West Keene by the Barrett family. The property is being sold and may still be used for dairy farming, but if it is, it might well be as part of the organic dairy sub-industry that’s keeping many small farms afloat. Or it might cater to some niche dairy market, like Hinsdale’s Echo Farm, which has carved out a name as a pudding manufacturer.

The reality is that smaller farms — yes, including those with “only” 1,100 cows — are falling victim to the industry’s economics.

The prime concept of economics is supply and demand: If demand exceeds the supply, prices rise; if the supply exceeds demand, prices drop. But within the dairy industry, this basic dynamic becomes more complicated. To begin with, while there’s plenty of demand for milk and other dairy products, that demand is predicated largely on the price remaining low. If milk is expensive, shoppers simply choose juice or soda or other beverages. That could drop the price so low that farms cannot succeed. So the government historically has stepped in to ensure farmers receive a price that allows them to survive and keep producing. But in the past decade or so, those protections have become more precarious, where they exist at all.

Add to that the changing economies of scale — it’s less expensive to produce milk if you have more cows, especially if you also treat them poorly to maximize production. So huge dairy farms have become the major players in the industry, to the point not only of having a built-in economic advantage, but also to where they have such influence as to direct regulation in their favor. Five dairy operations now control 44 percent of the industry.

Between 1992 and 2012, the country lost more than 250,000 midsize and small commercial farms, according to the U.S. Department of Agriculture. During that same period, The Washington Post reported, more than 35,000 very large farms started up, and the large farms already in existence consolidated their acreage.

Many think of New Hampshire and Vermont as agricultural holdovers. Asked to picture the twin states, it’s easy to conjure images of wooden-rail fences, big red barns, feed silos and black-and-white Holsteins. But Vermont ranks only 17th in dairy production and New Hampshire 37th among U.S. states. It may be our heritage, but whether it’s our future is certainly in doubt.

The good news is that the demand for milk and other dairy products isn’t going away, as has the need for VHS or DVD rentals. The question is what adaptations are needed to keep local farms in business.

The aforementioned organic movement offers some respite, for now. By adhering to its stringent processes, organic farmers can charge more for their product. But there’s a law of diminishing returns there; the more organic milk becomes available, the less prestigious it becomes, lowering the price. And in any case, the major players have taken notice of how lucrative organic products can be, which will eventually undermine the smaller farms.

The local food movement holds promise; more people, in this region and elsewhere, are consciously choosing to consume products grown or produced nearby. That may help keep some farmers afloat. To really have an effect, it will require far more shoppers to pay close attention to where their dairy products come from, and they may pay a premium for those products.

So, support local dairy farms when and if you’re able. And when you drive past those rolling fields, barns, silos and cows, enjoy them. While you can.

 

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