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Low milk prices take toll on dairy farms

Low milk prices are pushing Wisconsin dairy farms out of business, and that can have long-term effects on the industry as a whole as well as the consumer.

Wisconsin is known as the dairy state, so it may come as a surprise that the state has gone from having more than 40,000 dairy farms in the late 1980s to having less than 8,400 dairy farms today. That’s according to the president of the Wisconsin Farmers Union, Darin Von Ruden, who said as milk prices continue to go down, small farmers struggle.

In rural Wisconsin, you can’t go too far without spotting a cow. But the animals aren’t the cash cows they once were for dairy farmers.

“It seems just about every facet of agriculture today is suffering because of low prices — even organic,” Von Ruden said.

Von Ruden is a third-generation farmer in Westby. His son, Brett, is fourth generation.

“You know your neighbors, you know your land and how to take care of it and that’s how you stay in business,” Von Ruden said.

Even the Von Rudens, whose dairy farm of about 50 cows switched over to organic milk production 10 years ago, worry about the future of the industry.

“(I’m) not very optimistic,” Von Ruden said. “It’s really looking like prices we’re going to be receiving are going to be really at all-time lows, when you factor in inflation costs.”

He said in 2014, milk prices for producers topped out at $26 per hundredweight. He expects that, next year, prices will be in the $14 range, which is a few dollars less than what it costs to produce the milk.

And, Von Ruden said, savings are not necessarily being passed to the shopper.

“For what the producer is being paid, the consumer should be paying less for product they’re receiving,” he said. “There’s a lot of money going to the middleman.”

The main issue is that there is too much supply of milk in the market. Von Ruden believes that, rather than trying to sell the overflow where there may not be a market, the answer lies in controlling how much farmers produce while guaranteeing them a fair wage.

“Why continue to produce more and more milk when you’re getting less and less?” he said.

Von Ruden also worries about losing farm diversity.

He said as more small farms go under and only big farms remain, it becomes more likely that a single disease could wipe out an entire crop or herd of animals.

He’s also concerned that the new tax bill will hurt dairy farmers.

If this trend continues, the face of rural Wisconsin may look different.

“We’re losing a dairy farm a day,” Von Ruden said.

It’s not just milk. Farmers are dealing with low prices in many other agriculture industries, including corn, soybeans and organic products.


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