Each day of the week I receive an e-mail news alert from Google when anything is published online with the word “dairy” in it. For weeks now, many of the articles have been focusing on how steeply milk prices have dropped and how more and more dairy farmers are feeling the squeeze. While all of the articles from across the country have much the same message, some do a better job than others when it comes to portraying the dairy farmer in a positive light. I found this article to do just that. And it just so happens that Joe Engel of Luck-E Holsteins was quoted in it.
Joe points out an important advantage that he’s looking to during these low milk prices – the marketability of Registered genetics. If you’re in the business of breeding and marketing cattle, look towards this area to help you through the tough milk price times. 2008 was a record year for Holsteins sales. In fact, we saw the highest average price ever! Of the 6,870 animals reported to Holstein World as being sold, the average price was $6,149. This is $1744 higher than the average in 2007 and $2262 higher than the average in 2006. While we most likely won’t see record prices in 2009, we will certainly see solid prices paid at auction. For a complete look at Holstein World’s year-end sale analysis, click here.
Dairy farms milking cows for all they’re worth
Price per gallon fell 35 percent in two months
By Carolyn Starks | Tribune reporter
February 25, 2009
Dairy farmer Linnea Kooistra is pampering her cows because with the sour economy, she needs to milk them for all they’re worth. That means indulging 500 bovines with pedicures, sand beds and fine cuisine.
“As we take care of the animals, they take care of us,” she said while a pedicurist worked on the herd on her northern Illinois spread. “It’s one of the joys of being a dairy farmer.”
There hasn’t been much joy lately as milk prices have plummeted 35 percent in the last two months. The price a farmer could get for milk has dropped to $10.78 per 100 pounds from $15.28.
For Kooistra and her husband, grueling 15-hour workdays end with the realization that they lost money.
“You try to get the most milk you can out of each cow to limit the negative effects, the losses,” said Kooistra of Woodstock. “We keep her happy so she gives us more milk. She is the goose that lays the golden egg.”
Among milk producing states, Illinois is ranked 20th with 1,000 dairy farms. Many of the 60,000 dairy farms in the United States are cutting costs, selling cows or leaving the business altogether because they can’t keep up with operating costs, experts say.
In hard times, farmers reduce their herds to pay the bills. Nationally, 315,000 dairy cows were sent to slaughter in the first five weeks of this year, the highest number during that period since 1997.
The reason for the sudden, steep drop is simply too much milk and not enough demand as consumers cut back on eating out and buying high-end cheese, said Jim Fraley, manager of the Illinois Milk Producers’ Association.
Dairy exports also are down sharply because other nations are not buying milk, said Fraley, who calls dairy farmers eternal optimists.
“Milk is a very cyclical product,” he said. “They know prices will return.”
Joe Engel, 27, who chose to stay on his family’s Hampshire dairy farm after some of his older brothers left, is counting on it. When milk prices began to drop, Engel said he knew they would lose money and that they needed to stay above water in hopes next year will be better. He’s looking to other parts of his business—prized heifers or bulls or the embryos to sell in international markets.
He said the farm’s milk check is $650 less a day compared with the average price the farm got for milk last year.
“Right now, it’s so extreme that the check you get for your milk doesn’t cover the cost for turning the power on,” he said. “For the average cow, you’re losing money owning her because milk prices are so low, not because she’s not performing.
“The reason you keep her is that hopefully the situation gets better.”
At her farm in Woodstock, Kooistra said consumers would marvel at the pampering that goes into producing a gallon of milk. Hers is sold to Dean Foods Co., one of the country’s largest dairy processors.
Because cows stand on cement, pedicures help keep their feet healthy so they can stand longer and eat more, which produces more milk. The sand beds are the ultimate mattresses for keeping their appetites ravenous, she said.
A nutritionist analyzes their food for nutrient content and makes adjustments if needed to boost production.
“During times like this, we’re going on faith,” Kooistra said. “We’ve weathered storms before, we’ll get through this.”
* I came across this article online this morning. To check out the Chicago Tribune where it is found, click here.