Recession pushing dairy farmers over edge.(NY)

[amerikat]

SARATOGA SPRINGS — The economic downturn that’s hurt many businesses is rocking the dairy industry to its very core.

The gap between income and cost of production has never been wider, forcing some families to contemplate selling off their herds, an extremely stressful decision that goes way beyond just losing a job.

Wood said it costs about $16 to $18 to produce a hundredweight (11.6 gallons) of milk. The price farmers are getting in return has plummeted to almost $10. In effect, farms are paying someone to take their milk away.

“I’ve never had a gap like this,” he said. “This $10 price is unheard of. We had a bad year in 2006, but nothing like this. Still, we struggled through. This time there’s no way. We’re going to operate on reserves or loans for the next few months.”

The problem is compounded by the fact that most banks and lending institutions don’t have credit to give. The federal MILC program provides a limited subsidy based on a farm’s size. Larger farms such as Wood’s get the least amount of help.

A couple of years ago farmers were getting $20-per-hundredweight for milk and never could have imagined that prices would drop nearly in half. Farmers are now getting paid what they were 30 years ago. In the meantime, fertilizer that once cost $150 now goes for almost $900 per ton. A tractor that cost $14,000 in 1975 would probably cost at least $79,000 today.

Full story at link. http://troyrecord.com/articles/2009/03/16/news/doc49bdd80c262d3458393714.txt

I live in Washington County and know a few dairy farmers. Why can't they take some cows out of production
to get the price up? Dairy farming is very hard work. I hate to see them operate at a loss.

amerikat

cross posted from GD

[cabluedem]

1. Most working people have been operating on a losing scale for years...

as far as wages, so I doubt you will get much sympathy from all the folks that are now unemployed as well.

[MercutioATC]

2. The elimination of government price supports and rising fertilizer prices killed small dairy farms

here years ago (NE Ohio).

Only big commercial farms remain...the family dairy farm (really, any family farm) is dead.

[amerikat]

3. Perhaps we need to bring back price supports.

To many small farms are on the edge of oblivion here.

[DainBramaged]

4. I just paid 4.29 for a gallon, SOMEONE is making a lot of money

[amerikat]

5. The price has been falling here over the last few months.

I think it was less than $3/gallon..

[newfie11]

6. I feel sorry for the dairy farmers. They work their butts off

Cows need to be milked twice a day, 365 days a year, someone needs to check when they are calving,breeding, feed calves, treat sick calves, grow hay, silage, corn, etc. Then there is fixing fence, tractors, equipment, etc!

I know a few dairy farmers and no way in hell would I want that job.

[tama]

7. Mechanics of demand and supply

don't work so fine in a contracting economy, eh?