A few weeks ago there was a lot of media coverage about dairy farmers in Wisconsin having to dump their milk amidst the novel coronavirus pandemic because processing plants were full to the brim and couldn’t accept it.
While David Kaseno, national director of operations for the National Farmers Dairy Department, has not heard of any farmers in Minnesota who have been forced to dump their milk, the potential concern was certainly on the minds of many.
However, the dumping of milk started well before the effects of the pandemic were felt and experienced in rural America. The only difference was that it just received more media coverage during the outbreak, Kaseno said.
“A lot of the media is looking at the coronavirus as the sole source of what’s happening to dairy, but it’s not. Dairy has had some serious dysfunction before this and the virus only exacerbated the process,” he said.
Kaseno said the dairy industry has faced a very dysfunctional dairy marketing system for five or six years as milk production has exceeded processing capacity and consumption. That also makes it harder for small and mid-sized farmers to compete with large corporation dairies, he said.
In addition, based on different sources, Kaseno has formed the opinion that while almost all of the dairy industry has different people represent them with the Department of Agriculture, the media, the legislation and other people who are demanding emergency legislation are primarily representing large producers.
He also believes banks and lending institutions are far more likely to lend to large dairy corporations than to a fifth generation farm that has a solid track record of doing a good job and hasn’t caused a problem, he said.
“They’re saying they’re having some serious issues and I don’t doubt that. Everybody is suffering as a result of what has happened. The coronavirus may well go away, but the problems in the dairy industry aren’t unless they are addressed,” he said.
Kaseno said that part of the issue is that the federal milk marketing orders are outdated.
“First of all, federal milk marketing orders have been around for 80 years and it has done a remarkable job of doing the things that it was supposed to do during the early part of and throughout most of the life of the federal milk marketing orders, but we feel strongly that it should be modified or updated so it can deal with today’s problems and not the problems they had back in the 1930s,” he said.
In the 1930s, the struggle was to bring the milk from the country into the city to be bottled so that city residents had access to fresh milk.
While there are many different ideas floating around as to what should be done, National Farmers has suggested a structured dairy pricing program that involves two-tier pricing.
Kaseno said that data from the United States Department of Agriculture shows that production costs are higher for family-sized farms than for very large dairy farms. Because of the cost difference, National Farmers has suggested that all dairy operations receive a $4 price adjusted for up to 1 million pounds of production per month. Any production beyond the 1 million pound mark will be paid a smaller price.
There are several advantages to the structured management plan as it allows the farmer to decide how many cows to keep. It also enables new farmers to join the dairy industry with a small herd and still have a fighting chance.
As more and more farms continue to disappear across the United States each year, Kaseno said time is of essence for farmers across the country to take action. In 2019, 9% of the dairy farms in the United States were lost.
“We went from 37,468 to 34,187. More than half of these losses were in four states that have a long tradition of family dairies. We feel that the traditional family dairies in Minnesota, Wisconsin and in the upper Midwest have built communities that have been a very special place and they have used farming methods that were environmentally sound, protected our land and waters and I think they should be rewarded rather than disbanded,” he said.
Kaseno believes one thing the pandemic has highlighted is the need for produce and other food products to be produced, processed and sold locally.
“We should be doing that as opposed to hauling raw product all over the country and then dispersing to a consumer base all over the country from large consolidated plants were they milk, livestock, meat, almost any commodity that is produced,” he said.
National Farmers, a non-profit organization, was founded in 1955 to provide farmers nationwide a way to communicate their agricultural and rural concerns to local and congressional leaders.
Today, the agricultural marketing organization, which specializes in conventional and organic dairy, grains and livestock production, has grown into a source for member producers to utilize its group marketing and risk management services, which can help maximize their profits.