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Scroll down to see All. Storm Hits Dairying
Wednesday, 18 February 2009 American dairy farmers have found themselves caught in what is termed a "perfect storm" of dire circumstances. Since the first of the year, milk prices have dropped to near $10 cwt in many dairying areas. This is half the price dairymen were receiving last summer when Australia and New Zealand were in a severe drought. American dairymen expanded to fill these countries’ export markets and to help supply the growing Chinese demand for dairy products. Since then Australia and New Zealand have recovered, the American dollar has risen and the Chinese are scared to death of any dairy product since the melamine scandal. Dairy cows that were worth $3000 last summer are selling for $800 today and male Holstein calves are only worth $5.00 a head. Add to this a severe drought in California that has sent alfalfa hay prices through the roof and you have the makings of the aforementioned storm. Dairy cow slaughter is up 30% over last year whereas beef cow slaughter is down 14%. Last week DFA held a meeting in Memphis, Tennessee, to tell the 350 dairymen assembled there that their best hope was to convert to New Zealand-style grassland dairying. Who would have thought such a day would ever come? End Comments by Vaughan Jones I did, and have helped convert hundreds of North American Japanese and dairy farmers in other countries to grazing since 1980. When they change, their costs and milk production go down, but their profits go up, both of which are good, because there is then less subsidised milk to dump onto our markets, and if farmers are profiting they have less necessity to lobby for subsidies. |