In the Midst of 3-Year Price Slump, Dairy Farmers Must Adapt or Die



For the last three years, U.S. dairy farmers have been struggling with the longest price slump in recent memory. Already, some farmers have either lost their dairy farms or sought alternative forms of revenue.

Dairy farmers are producing milk faster than Americans can drink it, leading to the third year in a row for declining dairy prices. As farmers struggle to maintain their farms and make ends meet, many farms have gone under. Wisconsin, the United States’ largest dairy producer, has lost nearly 5% of its dairy farms statewide from 2016 to 2017.

How bad is the dairy slump? In the insurance world, agricultural “catastrophes” have a clear meaning. A catastrophe is defined as a series of closely related incidents causing in excess of $25 million. In that sense, the dairy slump is a clear catastrophe.

Some farmers have begun to strategize a comeback through alternative forms of dairy farming. While many are implementing rotational grazing to their regimen, others have begun sending their cows to the fields, hoping they can lower costs associated with maintaining them inside buildings.

Others have championed organic milk production, an eco-friendly, small-farm alternative to mass dairy production. However, even organic farms have been hit by the decrease in milk prices, making it more difficult to finance their farms.

There are over 2 million farms across the United States, and many of those raise animals. Dairy farmers have also begun including other animals in an attempt to diversify their profit; the number of farms herding goats and sheep have practically doubled since 2015.

Other dairy-supporting groups have tried to get Congress involved. For dairy-producing states like Wisconsin, the dairy industry promotes nearly $43 billion per year. The Dairy Business Association has tried to petition the government to revamp permit programs for larger farms in order to lessen the strain on local farmers.

However, change may be coming. A new study by the University of Texas Health Science Center at Houston has proven that there is no significant causation between the consumption of dairy fat and disease, including stroke. That may encourage more liquid milk consumption.

Nearly 3,000 adults over 65 were studied over the course of 22 years. Researchers measured the different plasma levels pertaining to three types of fatty acids. Those with higher levels of these fatty acids were reportedly less likely to die from stroke.

This new study means we can help reduce the risk of stroke in our elderly family members with a healthy diet that includes dairy. An estimated 70% of all American citizens aged 65 years or older will likely need long-term care during their life.

News like this could be positive for the dairy industry. As more people realize the benefits associated with drinking milk, the three-year surplus could soon start to dwindle.

For now, dairy farmers will have to continue to adapt.

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