US dairy farms in crisis as milk prices turn sour

[UpInArms]

Source: Reuters

CHICAGO, Feb 5 (Reuters) - Illinois farmer Linnea Kooistra expects to keep her 250-cow dairy farm afloat despite a rising tide of red ink caused by a collapse in milk prices, but other U.S. dairy farmers may be forced out of business.

Many of the more than 60,000 dairy farms in the United States have been cutting costs, selling off their cows, or leaving the dairy business altogether as milk prices plummet 35 percent in just the past two months while dairy farm operating costs remain uncomfortably high.

Some farms are losing $200 per head every month.

"We've dealt with 18 percent interest. We've dealt with farm recession. We've dealt with droughts and floods and this is by far the worst economic situation we have ever dealt with in our years of farming," said Kooistra, who has run Kooistra Farms in Woodstock, Illinois, with her husband since 1980.

"Right now, the price of milk will barely cover our feed costs and to pay our veterinarian. I'm not even counting all the other expenses that go along with keeping a farm running, the utilities, the fuel costs," she said.

<snip>

Despite the plunge in wholesale milk prices, the cost at the supermarket has declined only slightly as retailers have been slow to adjust their prices. Based on a USDA survey of retailers in 30 U.S. cities, the average price of a gallon of whole milk was $3.67 in December, down 25 cents from its summer peak.

Read more: http://www.reuters.com/article/bondsNews/idUSN0537024920090210?sp=true

---

does this remind anyone else of something?

[LiberalEsto]

1. The price of milk is insane

Because of lactose intolerance, I can only drink milk treated with enzymes, such as Lactaid or Dairy Ease. A gallon of Lactaid at my local supermarket now costs $5.99.

The current price of cheese, butter and other dairy products is higher than its ever been in my lifetime.

Who is getting all this money, if the farmers aren't? This is something that should be investigated and remedied.

[tom_paine]

21. Archer Daniels Midland and other Bushie Execs pocketing stolen trillions.

Where do you think the money's been going? Same place it has since Bushler I bragged it long ago "into higher, tighter, and righter hands"

[ixion]

2. "retailers have been slow to adjust their prices"

because, you know, why not bilk the consumer out of as much money as possible, even if it's a commodity. :grr:

Everything is going up, except the amount of money I'm able to make in the marketplace.

[TheCowsCameHome]

3. Milk is 2.49 in convenience stores here, big chains still over $4

The big stores can't gouge the consumer deep enough.

[asjr]

9. You've got that right. Every time I go

to a store, be it Walmart or Kroger, they have yet again gone up on prices of coffee. Instead of my usual 3 cups each morning I am cutting back to one. Even the price of potato chips has risen.

[Psephos]

26. I've been paying between 1.99 and 2.49 per gallon for the past month in Michigan n/t

[HereSince1628]

4. This is going to lead to udder chaos in the ag sector.

It will, it really will...

[Mari333]

5. if my mammary serves me correctly

this did happen during the great depression when the prices went out of consumer reach. The cows cant just be turned off.

[madmom]

6. I was going to buy potatoes yesterday but they were $4-$5 a pound at Krogers. WTF?

[Theobald]

8. $4 to $5 a pound?

That is friggin' outrageous. I bought NY Strip the other day for $3.99 a pound and was thinking that the $1.29 a pound I paid for potatoes was kind of high. For four dollars a pound I'm switching to rice.

[Theobald]

11. You'll be glad to know that

you can pick up a 10 lb bag of Russett Potatoes this week for $2.49 or 25 cents per pound.
http://central.inserts2online.com/customer_Frame.jsp?divID=021&drpStoreID=00936

[nc4bo]

13. I was going to buy potatoes at Food Lion over the weekend but $4.99 + tax per bag

was just too damn much money. Bag of onions was $2.99 +tax.

ALL varieties of apples are also $4.99 +tax per bag.

We went apple and potatoless.

[2Design]

7. everything in the job cuts to the other news is very similar to after Bush I

just the housing bubble is making it worse since prices are out of wack with salaries - should only be 2x salary, 3 at the most but right now it is 10x

[tandot]

10. "...collapse in milk prices..." ??? WTF? I pay around $5 for a gallon of organic milk

if I can get it on sale.

[TheCowsCameHome]

12. Organs are very expensive, too. Try piano or accordion milk .

I'm sorry. I couldn't let it pass...............

I do sympathize with you.

[GoddessOfGuinness]

14. The cost of milk hasn't gone down here at all.

The lowest price I can get on a gallon of 2% is $3.50, and I have to buy 2 gallons to get that price. It's been stuck there for at least a year.

Who the hell is getting the money?

[mbperrin]

15. What $3.67? I paid $5.27 last night at Albeertson's!

Love to get that $3.67!

[Xipe Totec]

16. Somebody is skimming

The question is where is the money going, if it's not reaching the milk producers.

Who's milking the profits?

[Lorien]

18. Are there dairy speculators?

it doesn't ring a bell, but these days, who knows? The greedy have been gambling on everything and we're the ones paying for it.

[safeinOhio]

17. All the dairy men and women need to do

is dump their milk for a week or two and the price will double real fast.
The problem has always been, the price goes up and farmers milk more and more cows. The price drops and they sell off. If they could ever get together on production, they'd have a pretty steady price.

[Coventina]

19. Look for deals on low-grade ground beef shortly. n/t

[safeinOhio]

22. Go long on McDonalds, their cost is gonna drop.

Wholesale price for cheese and milk drop, along with the price of ground beef.

[Winterblues]

20. There was a post here a few days ago about a wholesaler that delivered school milk

They said they were beginning to lose money as well. That the price of the school milk had dropped by 20-25% but their other expenses had not, so it isn't just dairy farmers that are effected.

[elocs]

23. I just bought a half gallon of milk at my local 7-11ish store and it was 89 cents,

down from $1.04 just last week. I sure do appreciate the low price for food that I pay here compared with people in other areas. I can eat well, but simply on $25 a week (there's just me) and that does include fruit, veggies, and that necessity of life--chocolate.

[Tempest]

24. Lower milk prices are exposing corruption in Palin's administration in Alaska

http://www.andrewhalcro.com/the_valley_dairy_money_losing_milkonomics

If it wasn't enough that the State's Agriculture Board and the Director of Agriculture bent state rules to lend taxpayer money to their friends, neighbors and relatives without any personal guarantee; today's news shows how doubtful it is that the state will ever get paid back the $630,000 lent to the Valley Dairy just two months ago.


The State Agriculture Board and the Director of Agriculture are Palin friends appointed by her.

[Tashca]

25. I've been living a delusion....

I honestly was thinking the Ag. industry might scrape by this time without a lot of pain.

I've noticed just in the last two weeks how things are changing in the industry...fear is predominant. People are suddenly talking about the early 80's and the farm crisis.....their attitudes are getting fearful. They are drastically cutting back on spending.

I don't work with dairy farmers, but know this is an ominous sign. The dairy farmers will start selling off their herds and that meat will hit the market driving down prices. That also means less feed being bought. This will impact the whole agricultural sector eventually. It's like watching a slow moving train wreck....Farmers understand tough financial times means less dairy and meat consumption....whick in turn means less grain needs.

I've been through this before in the 80's and am not looking forward to it at all. I wish I hadn't just read about the late 20's and early 30's.....

[d_r]

27. in chattanooga

Mayfield is pushing $6 a gallon; it is $4 something for no-name milk.