how long can dairy farmers hold on?
By Sara Butterfass Staff Writer It is a well-known fact among dairy farmers that things are not going well. For months they have been struggling to stay out of the red, while milk prices have continued to drop, feed prices remain high, and banks are less willing to make loans or refinance debt. The biggest question facing most dairy farmer right now is “How long can I hold out?” By mid-2007, dairy farmers were receiving more than $20 per hundred pounds of milk (cwt). Prices dropped some in 2008, but the year-end average in the US was $18.29, according to the University of Wisconsin Dairy Marketing and Risk Management (UWDMRM) web site. What caused these record-high prices? Ed Welch, president and CEO of AMPI, explained that it began in 2007. New Zealand and Australia, the United States’ top export competitors were suffering from a drought and the US dollar was weak. This made US products more affordable abroad. During this period, the US was exporting 11 percent of its dairy products.
