Dairy Farmers and Farm Advocates Demand Regulatory Change

by Maggie Tauranac

4/27/18

Since the beginning of 2018, in a bleak shift in procedure, dairy cooperatives have been enclosing suicide hotline information with the checks they mail. For example, after a series of farmer suicides in a short period of time, Agri-Mark, a dairy cooperative from New England, mailed checks with a chart displaying the ominous milk forecast for the upcoming year along with a list of suicide hotlines. They felt the need to address the problem head on, but farmers were shocked and often devastated by the blunt response to a critical and sensitive topic. The subtext was clear: things are bad, and about to get worse.

This week, the National Family Farm Coalition (NFFC) and 52 allied organizations sent a letter to Secretary of Agriculture Sonny Perdue and the leadership of the Senate and House Agriculture Committees to demand action to support dairy farmers currently in crisis. According to the letter, milk prices are presently at $15 per hundred pounds of milk, 30 percent below the cost of production.

Bruce Drinkman, a dairy farmer turned farmer advocate in Wisconsin, described conversations with other dairy farmers of his generation who say they feel they have “nothing to show for a lifetime of work.” And still, prices are projected to dip even lower.

The oversupply of milk and dairy products is largely due to the structural inadequacies of the Federal Milk Marketing Order, a system in which producers compete within a marketing area and set minimum prices. This pricing structure ends up benefiting large producers while threatening small local businesses. Regional farmers can’t keep up. Ohio, for instance, saw the closing of 59 dairy farms in a mere five months because of unsustainably high costs of production paired with dismal milk prices, which have been on the decline for four years consecutively. As Mr. Drinkman put it, “Until our government decides they’re going to do something, it’s just going to continue to be the bloodbath that it is.”

"Until our government decides they're going to do something, it's just going to continue to be the bloodbath that it is."

The letter to Congress and the United States Department of Agriculture demands several courses of action to address the lack of a financial safety net for dairy farmers, including setting a price floor of $20 per hundred gallons (still a compromise, but a livable one) and the suspension of federal loans and funding for Concentrated Animal Feeding Operations (CAFOs).

Carolyn Dimitri, an applied economist who teaches food systems and policy at New York University and a former employee at the USDA Economic Research Service, sees the problem for dairy farmers being rooted in the inherent vulnerability that comes with being unable to set their own price. “A longstanding problem in the dairy sector is the market power [that] processors and cooperatives wield over dairy farmers,” she says. “A second problem is the bifurcation of farm size, with larger CAFOs and smaller dairies in competition.”

"The consumer is the farmer's best ally. We just need to make that connection between the farmer and the consumer."

She agrees that raising the minimum price, as the letter recommends, is a good short-term solution for protecting small dairies, but expresses concern that it could result in two associated problems. First, in the medium term, higher prices will eventually encourage greater production. Then in the longer term, smaller farmers would be less likely to compete with the low-cost milk produced by CAFOs. She adds, however, that “NFFC’s call for changing policy support on CAFOs directly tackles the long-term problems by asking the government to effectively raise their production costs.”

And Mr. Drinkman appears to agree on the topic of overproduction. “The American dairy farmer — farmers period, but specifically dairy — is going to have to learn that more production isn’t necessarily in its favor.”

The letter sent by NFFC and their allies provides a structure for Congress and the USDA to begin reparations for a system which continues to fail our smaller-scale farmers and favor large-scale agricultural practices.

Ultimately, consumer demands for better farming practices that favor small farms give Mr. Drinkman hope. “The consumer is the farmer’s best ally. We just need to make that connection between the farmer and the consumer.”

Take a minute to read the letter to Secretary Perdue.

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