Seventeen dairy farms have shuttered in Maryland in 2019, state data show.
Sixteen of those closures occurred in the first three months of the year, and one occurred in May. There were no closures from June to mid-July, according to the state’s Center for Milk and Dairy Product Safety.
In January, there were fewer than 370 dairy farms statewide.
The rate of closures puts the state on pace for a yearly total similar to the last two years. In 2018, 41 dairies closed, and in 2017, 33 closed. Most of those closures occurred within the first four months and last four months of the year.
It’s too soon to tell whether the lack of closures in June and mid-July suggests the beginning of a firmer milk market for Maryland producers, said Dale Johnson, a farm management specialist at the University of Maryland Extension.
“I think we’ll just have to wait and see,” he said. “I’d like to see what happens this fall.”
Dairies have been helped by a slight increase in milk prices in 2019, thanks to slightly reduced dairy production. Earlier this month, the USDA’s 2019 all-milk price was forecast at $18.20 per hundredweight, a nearly $2 increase over the previous year.
Dairy farms in Maryland have been closing at a fairly consistent rate over the last three decades. In the early 1990s, there were more than 1,400 total dairies in the state.
Gov. Larry Hogan announced in February the state would offer about $1.5 million to help pay farmers premiums for the federal government’s new Dairy Margin Coverage Program. The voluntary insurance plan, revamped in the 2018 Farm Bill, pays out when the national average margin between milk income and feed costs falls below farmer-selected coverage levels. Those premiums could yield up to $17 million for Maryland producers, Hogan said.
“We’re highly, highly encouraging (farmers) to sign up,” said Colby Ferguson, Maryland Farm Bureau’s government relations director.
But many dairies in Maryland are surviving only because the farmers are generating income through another farm product or an off-farm job, Johnson said.
“The cost of production is way above the price of milk,” he said.
Source: American Farm Publications