Wednesday, September 24, 2008

Dairy Farmers in Trouble

Dairy farms do not make up a large percentage of the GDP of my small state of Vermont, but they are an essential part of its culture. And dairy farmers are hurting:

Milk prices are projected to fall in the next couple of months just as grain and fuel costs rise. Experts say it might be difficult to make much money on the farm this winter.


Diane Bothfeld of the Vermont Agriculture Agency says farmers' balance sheets don't look very promising.

(Bothfeld) "We really are getting to the point where the price to be paid out in October and November will probably dip below a farmer's just plain operating cost, no return on investment, no profitability. ... We're going to see a tough times in the last few months of 2008 for dairy farmers.''

(Sneyd) Right now, just to paid for feed and fuel, it costs a dairy farmer almost $17 for every 100 pounds of milk he or she produces. That's what economists project the farmers will be paid for that same 100 pounds of milk this winter.

Farmers will still have to pay their utility and labor costs, so they may have to take a loss, at least for part of the year.

The situation is worse for organic farmers. Their feed prices are two to three times higher than what it costs a conventional farmer.

UVM Extension already knows of a couple of organic farmers who've quit the business. And a handful have moved back to conventional farming because they can't keep up with the costs.

I'm sure farmers everywhere are under the same pressures. Just an unfortunate sign of the times.

No comments: