President Donald Trump’s agriculture secretary said Tuesday he believes dairy farms can stay in business, but they may have to get bigger to do so.
“I think the 2018 farm bill will stem the flow of that” loss of dairy farms in recent years, Agriculture Secretary Sonny Perdue told reporters.
“Now what we see, obviously, is economies of scale having happened in America — big get bigger and small go out. … It’s very difficult on economies of scale with the capital needs and all the environmental regulations and everything else today to survive milking 40, 50, 60 or even 100 cows, and that’s what we’ve seen.”
Perdue made his comments after holding a town hall meeting with farmers and dairy industry officials at the kickoff of the annual World Dairy Expo at Madison’s Alliant Energy Center.
“What I heard today from the secretary of agriculture was there’s no place for me,” said Volenec, who spoke at a news conference organized by the state Democratic Party.
Nearly 3,000 U.S. dairy farms folded in 2018, about a 6.5% decline, according to U.S. Department of Agriculture figures.
Wisconsin lost nearly 700 — almost two a day — as even dairy farmers used to enduring hard times called it quits in the fourth year of a downturn in milk prices.
Though prices have improved some in recent months, Wisconsin has still been losing more than two dairy farms a day this year, wreaking havoc on the rural economy. Many families exhausted their savings and credit to remain in business, and they eventually had to shut down their milking operation to cut their losses.
“What we’ve seen is the number of dairy farmers go out, but the dairy cows haven’t reduced that much. The dairy cows haven’t gone to slaughter. They’ve gone to someone else’s herd for the most part,” Perdue said. “That just increases the supply of milk, which makes the supply-demand balance even exacerbated in that way.”
Asked if he believed small dairy farms will have to get big to survive, Perdue said: “That remains to be seen.”
“Everyone will have to make their own decisions economically whether they can survive,” he said. “I don’t think in America for any small business we have a guaranteed income or guaranteed profitability of survival. That depends on each and every farmer and dairy farmer.
“Farmers are pretty good at managing and managing through tough times. I think those that have survived through the ’14 farm bill should do well in the ’18 farm bill.”
Darin Von Ruden, an organic dairy farmer from Westby and president of the Wisconsin Farmers Union, said at the Democratic news conference that elected officials need to do more for small farmers.
“I mean, do we want one company owning all our food in this country?” he asked.
He called for a milk supply management system to help ensure farmers get better prices for their product.
Perdue rejected that idea.
“I think that’s been tried before and I don’t think in America that’s the way we need to go,” Perdue told reporters. “While some have suggested that, I don’t think that’s what I know about America and American productivity regarding supply management. We tried farm programs in the past to do that, set-aside programs and dairy buyouts and other kinds of things. The industry has to control its balance of supply and demand.”
Source: JSonline
