Dropping Milk Prices, Emotional Stress

If you don’t know by now, consider this your notice, milk prices on-farm have been dropping for months and currently are at the lowest point they have been in almost 7 years.  The last time financial impacts like this hit the dairy community there was a mass exodus of producers, many of which wish they didn’t have to sell their cows but they couldn’t provide for their families anymore.  This is our current reality.  Today I read articles about record cheese inventories in the United States putting pressure on milk price to drop even lower.  I heard from fellow dairy farmers that the exodus has started again, dairy farmers are being forced to sell their herds and even land in order to pay off debt and save themselves.  This dip in prices will have long lasting effects on the dairy community, no matter the size of the farm.  It does not discriminate.  So as a reader, why should you care?  What is my purpose in sharing this with you? 

These dairy farmers work tirelessly for their families, their cows, their farms, and yes you the consumers.  They are experiencing emotional stress that you can’t even describe.  These dedicated farmers wake up every morning fully aware that they are literally paying admission to milk their cows.  They are not receiving income from their farms, but paying just to keep them.    Many farms are accumulating thousands and even millions of dollars of debt just to feed and care for their cows.   But it isn’t the financial situation that concerns me the most.  What concerns me the most is the emotional and mental health of these amazing people.

These men and women will most likely sacrifice everything they have to give to keep doing the one thing they know and love, milking cows.  I talked to a dear friend in Ohio who has a small herd.  He told me he will farm until he’s completely broke and go to a food bank for himself and his wife before he sacrifices his cows.   That’s right, he would sacrifice for his family before he would sacrifice for his cows.  He’s not alone, I know many just like him.  I know of farmers trying to make cuts to the budget, but they refuse to compromise their soil, water, and cows’ well-being.  These passionate men and women believe in a hope that is impossible to describe, because many believe if they keep pushing forward through the hard times that good times will soon follow.  Their perseverance pushes them to keeps them fighting for their calling.   Crops were planting this spring and hay is being harvested, farmers’ optimism continues, but at what price?  I can see the stress on their tired faces.  The worry is in their eyes: how will they feed and clothe their families, how will they pay even part of their monthly bills, how long will this last and can they make it that long? 

What can you do to help farmers?  Keep drinking milk, eating cheese and enjoying yogurt.  Dairy foods are some of the most local foods we have available, with the average gallon of milk traveling no more than 100 miles to the grocery store from the nearest dairy farm.  By drinking milk, you are helping your neighboring dairy farmers.  Please help these amazing farmers provide for their families and yours, by doing something as simple as making sure you and your family enjoys 3 servings of dairy each day.  And while you’re at it, please pray for these hard working heroes, they need all the love and support they can get!  Thank you!

I'm Fine

“I’m Fine” are the 2 worst, most deceiving words in the English language.  They are used so often to cover up our true feelings of sorrow, grief, sadness, pain, shame, weakness, embarrassment, struggle, anger, frustration, and just plain ol’ fashion vulnerability.  We act like “I’m fine” is a good enough protect us from being seen; to help others feel at ease rather than being honest and real with what is actually hurting us or how we feel.    No wants to admit feelings but so often we need to in order to free ourselves and grow.  Dairy farming is tough, there’s no way around that, and right now it is very tough.  Farm prices for milk are once again at an industry low.  While these prices are nothing compared to the catastrophic year of 2009, these are tough times once again.  Another factor is the ever increasing costs of farming, whether it is land, feed, insurance, labor, or even regulations.  Now ask a dairy farmer how things are going on their dairy and most will reply, “I’m fine”.  Only on certain days when farming has really got them beat down will they be honest about the sacrifices that they have to make. 

Then they will tell you how much it hurts to feel so vulnerable to the markets and have so much of their life out of their control.  How hard it is to know that you might not be able to pay all of your bills this month.  How disappointing it is to have an excellent employee leave your business because you just can’t justify giving them a raise for their hard work, right now.  How much it hurts to look at their families and know that they can’t give them everything that they need or want, and that as a family they will have to be the first to sacrifice so their employees and their families can be paid and fed first before their own.  Disheartened over the next major machinery repair, which means unplanned bills that will have to be paid, because you can’t go on without that vital piece of equipment.  Every cow, heifer, and calf was already a valuable living being, but their wellness is even more critical when prices are low because illness and death are expensive.  Essential equipment upgrades have to be put on the back burner, until prices are better. 

It’s ok to be honest about these feelings and challenges.  I think consumer should hear the struggles of the American family farmer.  A very wise friend pointed out that so often we let egos get in the way of what we’re really trying to feel and say, especially in agriculture.  I think he is right, let the egos go.  Be honest.  When you get asked how things are going on your farm, let be real with each other and consumers.  It’s not all roses and butterflies, in fact some days it gets down right ugly.  If given the chance, though I’m certain all of us would keep on farming regardless, that’s what we’re made of: perseverance, passion and drive.  Lets be honest with each other and consumers, it’s not all pastures and prairies; it's floods, droughts, storms, and most days rainbows.

Milk Price Venting...

I haven't blogged for awhile and I was struggling for topics to talk about, since the farm has been pretty silent, other than finishing our taxes. Then, I checked the futures prices for milk on the CME website. I am frustrated. Latest market news about better than expected stocks of dry milk, butter, and cheese in addition to a slowly improving world economy has eroded our once optimistic 2010 milk prices. As dairy farmers we are constantly at the mercy of market conditions, world economies, consumer demand, and the weather. At the end of 2009, I know I was looking forward to the more optimistic 2010 futures prices. Industry leaders were forecasting $15/100 pounds of milk for 2010, but now 2010 looks more like 2009. Today the posted markets will give us about $12.90/100 pounds of milk instead of $15. Last year we averaged $12.65, and lost money 8 months out of 12 in 2009. Needless to say, it's going to be a tough spring trying to make ends meet with these prices.

As dairy farmers we have only a handful of options. We can either lower expenses or increase milk pounds to increase income. At Orange Patch Dairy, we will mostly likely do a little of both. Thanks to 2009, we have many practices at work already. We closely monitor our feeds to make sure that we are feeding our cows EXACTLY what they need, and that we don't feed excess nutrients which will pass into the manure. We try to keep our cows in top physical condition, as we know that sick cows cost money. As we work to keep our cows healthy we also reap the advantage of increased milk production. We know that healthy cows are happy cows, and productive cows.

The only other thing I can do is ask all people, young or old, big or small....to make sure that they balance their diets with 3 servings EACH day of dairy products for healthy living and healthy futures.

Ready to leave 2009 behind!

I think I speak for a number of dairy farmers that I know....we are all ready to leave 2009 behind! It's been a rough 12 months in the dairy industry. We started 2009 knowing that we would be facing low/unprofitable milk prices, but none of us could predict that those low prices would persist for as long as they did.

This year tested even the hardiest farmer, not only with prices, but also with weather. The weather was cool, the growing season was poor, the winter 2008-2009 was long, and the harvest of 2009 was even longer and muddier. The stress tested every one's spirits and wills. The resilient survived, but those who didn't make it weren't bad farmers....just in bad circumstances. And lessons were learned. At Orange Patch Dairy, we learned a few good lessons that I thought I would share as well as our goals for 2010:

Lessons Learned from 2009

1. Always save for a rainy day-this was our saving grace this year. When times were good, we put away as much money as we could. That money helped pay bills that we didn't have enough cash flow to pay for.
2. Take a Vacation. Taking a break from the stress of the farm has no value. Time off to be with family and friends is invaluable...we know this is true.
3. Top notch care for our cows always comes first, no matter the cost! We worked the entire year making sure that we sacrificed nothing for the cows, but instead spent less on ourselves. Our cows' care always comes first on our dairy farm, they are loved greatly.
4. Keep doing what you do best. We know we take good care of our cows-we worked all of 2009 to continue doing that, and making the best care even better.
5. Breathe-find JOY in the small things. If we couldn't have financial success in 2009, we had small successes: a new born heifer calf, a healthy cow, a beautiful sunset, all of God's great blessings.

Goals for 2010

1. Improve our cow facilities: We have comfortable barns now, but we know we can make improvements to make them better. Now that we will hopefully be producing milk for a profit we hope to return those profits to new renovations this year. I also hope to post those renovations on this blog.
2. Continue to find JOY. How could we not take this goal from 2009 with us?!?!
3. Continue to improve cow and calf health. There is always room for improvement here. I look forward to a day when we have facilities that will provide environments for our animals that prevent disease so we don't have to treat disease. Our barns are good but there's always room for more fans, better heating, more feed space, etc.
4. Milk more cows. I don't want to milk more cows for more money but because I love all of my cows so much, I can't bear to part with them or their kids. We hope to milk about 110 cows the full year through. That's enough cows for me though, any others will need to be sent to good homes on other dairy farms.

All of these goals and aspirations we look to on a daily basis, helping us make good decisions working towards our goals. Orange Patch Dairy looks at 2009 as a learning experience, and at 2010 as an opportunity to do better. As they say in 4-H " To Make the Best Better"

3rd Cutting of Hay Done!

Ah the joys of Minnesota weather! When we cut 1st cutting of alfalfa in May-it was 97 degrees and 50 mph winds. Our June, 2nd cutting took us 7 days between rain showers/thunderstorms and 80 degree humidity. This 3rd cutting of alfalfa that we finished last night was harvested in 60 degree weather-cool and day, much like October should be. It's been a roller coaster of weather this summer. We are currently 7 inches behind on our annual rain fall-which the crops are really starting to show. It's been cool and dry so the corn isn't "burning up" too quickly but if we don't get rain this week it will be the end of some of our corn-it's just been too dry for too long.

Nevertheless, we finished our 3rd cutting of alfalfa-all 130 acres which yielded only 85% of what it should have. It took us about 2 days to start and finish-thanks to the help of a good friend who came over to help drive tractor and lots of family. One of the joys of working on a farm is that family is usually able to help during big projects like this. Working with family is fun and trying all at the same time. Now we begin praying for rain-lots of it, with a little bit of God's help.

We got our milk check for June's milk today. As dairy farmers we are paid twice per month. Our creamery pays us every month of the 17th (for the month previous-June) and the 25th (advance check for July). Our take home price for milk was $10.68/one hundred pounds of milk. This milk price would equate to about 93 cents per gallon of milk. This price is not enough to pay all of our bills, but it does pay some. We also receive a monthly MILC (Milk Income Loss Contract) payment from the government. This check also doesn't help to meet our monthly bills, but it does help. We would prefer to not collect money from the government, but help is appreciated at a time like this. We try to capitalize on some premiums/bonuses from the creamery. We get paid extra money if we can increase our butterfat and protein levels. We also get increased premiums for high quality milk (lower somatic cell count or less infections/white blood cells). Therefore, we are doing are best to get any premiums we can---healthy cows are profitable cows!

Today was a good day for a nap-even if it was finally summer outside again. We went to church, out to eat, and home for sleep. It was awesome! It's been a couple of long nights working to get hay done.

When and If....

When and If we make money someday dairy farming...please don't be mad at us.
When and If we make a living on a farm we love...please don't begrudge us.
When and If we produce a safe and wholesome product for a profit...please don't grumble at us.
When and If all of our hard work, tears, sweat and blood finally pays off...please don't curse us.

Right now we are experiencing our WORST year ever as dairy farmers. While we have only been farming for a little over 4 years, this has been hands down the worst year. We are paying more for expenses (feed, fuel, fertilizer, vet, etc.) than we ever had, as well as coping with the lowest milk prices in years. For ourselves, we were smart and saved up a small "insurance fund" for the rough spots. But the rough spots are lasting longer than any of us ever expected. We look forward to $15 milk, when we are getting paid $10 for every 100 pounds of milk. It's not that $15 will make us money, but that $15 will at least pay the bills. We would prefer $17-18 instead-but that seems like a distant dream now. We are not begging for government intervention or massive milk supply contraction. We are working hard to make our farm more efficient. We control our costs-spending money only on things that will make us money or needs to be spent. We would like consumers to purchase and use more dairy products-as the are an important part of balanced diet.

We know that the market will turn around sometime...it's just the time that we have to survive through. We have hope that things will get better. We mourn the lost of our friends and fellow dairymen that have not weathered this storm as well as we have. It's a shame to lose so many to a bad economy, but it is the way the system works. So many that worked so hard and with so much passion to make a living, only to watch it all be taken away from them. So sad. So sad.

So when we do make it back to $17-18 milk, please don't complain about the prices in the stores. Please don't complain, because we receive only a small amount of the retail price. Please know instead that a farm family is finally making a living instead of paying for the opportunity to work. They are instead, finally getting paid to go to work, every other American. We put so much passion in what we do. If we were truly in this industry to make money....well we would have quit by now, especially this year. We would have said "screw this! It's too hard of work for such little pay"....but the truth is that we love what we do, we love the cows that we work with, we love feeding the people of the world with a nutritious product, we love giving back to our communities, we love giving back to our environments....even if we have to do it with little or no pay. Dairying is what we love. Please don't complain, because that gallon of milk you just bought was made with love, passion, devotion....from the entire dairy industry. Just a matter of When and If....