The number of dairy farms in Wisconsin continues to decline. Meanwhile the trade tariffs are crippling dairy prices. Lastly, the U.S. Senate has passed several measures to support dairy farmers including funding to support dairy product innovation and market expansion. This article will explore some of the latest headlines about the dairy industry and the battle to save dairy farms.
Dairy Farms Decline
Jim Dickrell of Dairy Herd recently wrote a story titled, “More than 4% of Wisconsin Dairy Farms Call It Quits in 2018—So Far”. This is an alarming number considering this percentage only accounts for closures in the first seven months of the year. This number is up 35% from last year at this same time. Even the total head of dairy cows in Wisconsin is down year over year.
Dairy Prices Decline
The most significant reason for the decline in the number of dairy farms is the decline of dairy commodity prices and the price volatility. Larry Lee of Brownfield Ag News wrote a piece about analysis of trade tariffs on dairy commodity prices. The title of the article is, “Vitaliano: Tariffs have cost dairy farmers $1.8 billion so far”.
Lee notes that while full impact of tariffs on dairy prices is not perfectly clear the damage is significant. Lee cites work done by Peter Vitaliano, National Milk Producer’s Vice President of Economic Policy and Market Research.
Vitaliano is quoted saying
“We had basically a reduction by my calculations of about $1.65 loss per hundredweight during the last six months.”
Moreover the impact to dairy farmer income is staggering according to Vitaliano.
“The total estimated loss of U.S. dairy farmer income during those six months is 1.8 billion dollars.”
Meanwhile the full impact is even worse as Vitaliano shares that his numbers about the tariff impact lag by a month or two, thus the blow isn’t perfectly clear yet.
Stopping the Decline
Short of ending the ongoing trade tariff disputes there are other measures that may help dairy farmers. The first was announced several weeks ago, the USDA trade aid package. Of course the devil is in the details on such a package and how much the USDA will allocate toward dairy farms is still to be determined and announced. Read about 2 Things You Must Know About Trade Aid.
A second positive development to help dairy farmers was touted by U.S. Senator Debbie Stabenow (D-Mich.), Ranking Member of the U.S. Senate Committee on Agriculture. The bipartisan Senate version of the Farm Bill passed with overwhelming support.
The 2018 Senate Farm Bill creates a new-and-improved safety net called Dairy Risk Coverage to help dairy farmers weather financial uncertainty and builds on the improvements Stabenow authored in the Bipartisan Budget Act that has provided nearly $10 million in support to dairy farmers this year so far. The Farm Bill also refunds farmers who received coverage under the former safety net – the Margin Protection Program – which did not live up to expectations. The bill also includes a new donation initiative that helps Michigan dairy farmers provide milk to local food banks.
A third and recent development was covered by Nicole Heslip of Brownfield Ag News, again a positive development out of the U.S. Senate. The Senate passed a funding package that included $7 million for the Dairy Business Innovation Act. This legislation is designed
to help cheese makers and other dairy businesses innovate products and expand markets.
Along the way the Senate voted down an amendment that
would have stopped the FDA from using funds to regulate non-dairy milk alternatives.
The National Milk Producers Federation believes this sends a strong message to food marketers who have been ignoring FDA’s food labeling standards by inappropriately using dairy terms on products that do not contain any dairy.
Dairy farms have been closing at an alarming rate. However, there are some positive developments that may indicate that policy makers understand the urgency facing many dairy farm families. Hopefully, the necessary actions take affect in time to save many dairy farms.
Update: Ag Nook’s continuing coverage of Dairy farm closures is covered this piece titled, “America’s Dairyland Disappearing“.