Wisconsin losing two dairy farms a day
As milk prices drop, Wisconsin losing two farms a day and state’s $88 billion industry hangs in the balance
Drop in milk prices, response to tariffs threatens state’s $88 billion industry
There was a time when the soft glow of barn lights dotted Wisconsin’s rural landscape like stars in a constellation, connecting families who labored into the night milking cows, feeding calves and finishing chores.
Hundreds of those barns are dark now, the cows gone, the hum of milking machines silenced.
“All of our neighbors are done,” said Sue Spaulding, a dairy farmer near Shell Lake, in Washburn County.
She and her husband, Chuck, soldier on, milking about 60 cows on their 300-acre farm that Chuck bought when he was only 17.
Seven years ago, the Spauldings borrowed heavily to modernize their barn and position things for the future. “It looked good on paper,” Sue said. But in late 2014, farm milk prices plummeted. The downturn, fueled by overproduction and failing export markets, has lasted more than four years and has wiped out dairy farms from Maine to California.
The price farmers receive for their milk has fallen nearly 40 percent.
“This downward cycle has been brutal,” said Kevin Schoessow, a University of Wisconsin extension agent in Washburn County.
Wisconsin lost almost 700 dairy farms in 2018, an unprecedented rate of nearly two a day. Most were small operations unable to survive farm milk prices that, adjusted for inflation, were among the lowest in a half-century.
Remaining dairy farmers have burned through their farm equity and credit to remain in business. Often, at least one family member works an offfarm job to put groceries on the table or pay for health insurance. Some work double shifts, farming during the day then heading to a local factory for the night. It’s exhausting, but it keeps families in agriculture and preserves a cherished way of life.
Much of Wisconsin’s $88 billion farm economy hangs in the balance.
This spring farmers face crucial decisions. Some are running out of feed for their cattle. Do they seek operating loans to plant crops for livestock rations? Or do they quit and cut their losses that can add up to thousands of dollars a month?
“Banks are wary of taking on more risk,” said Michael Slattery, an economic adviser for Wisconsin Farmers Union, a trade group.
Nearly every dollar the Spauldings have earned from their milk the last few years has gone toward their debts and farm insurance, leaving them with little income except for Chuck’s Social Security check and selling some livestock and hay.
“It’s been such a struggle just to keep things going,” Sue said. “We have managed, but now it is getting hard to pay even our basic everyday bills. I don’t know how much longer we can do this.”
“It’s been such a struggle just to keep things going. I don’t know how much longer we can do this.”
Sue Spaulding,
Wisconsin dairy farmer
In the mid-1800s, one-sixth of the wheat grown in the U.S. came from Wisconsin. White settlers from the East Coast didn’t need much investment and found the crop easy to manage.
But varying yields, rising competition from neighboring states and an in-
sect infestation forced wheat farmers to consider alternatives. Dairy farming emerged as a better fit for the state’s terrain and climate.
By the turn of the 20th century, 90 percent of Wisconsin farms had dairy cows, and by World War I the state led the nation in butter and cheese production. It held the milk production title until 1993.
Sales of milk as a beverage have fallen steadily since the 1970s, with fewer parents encouraging their children to drink milk than ever before. Soy milk and almond milk – which dairy farmers point out aren’t real milk – and scores of sports drinks have flooded the market.
And although consumption of cheese, yogurt and butter have all increased, they’ve not always kept pace with runaway production. Today, U.S. commercial and government cheese stockpiles are at about 1 billion pounds — the highest level in a century.
At the same time, foreign markets for American dairy products have shrunk in response to tariffs that President Donald Trump placed on foreign steel and aluminum. Cheese shipments to China have fallen almost 65 percent, according to industry figures, and exports to Mexico are down more than 10 percent.
Mexico and Canada have targeted rural America as a way to punish Trump, and the economic harm could be felt for years to come, said Laurie Fischer, CEO of the American Dairy Coalition.
“This should have changed in November when Trump declared success with his newly rechristened U.S.-Canada-Mexico Trade Agreement replacing NAFTA,” Fischer said.
“In retrospect, it was a disingenuous statement: The administration has not lifted steel and aluminum tariffs on Mexican and Canadian products, and in response, those countries are refusing to (ratify) the pact or lift retaliatory tariffs, impacting dairy products and other items.”
Wisconsin farmers are getting about $10 million in payments from Trump’s farm bailout program announced late last year. It was designed to help producers of milk, pork, soybeans, corn and other commodities who have seen prices tumble in trade battles.
A 55-cow dairy farm would receive a one-time payment of $725 from the bailout but stood to lose between $36,000 and $48,000 in income last year from low milk prices, according to the Wisconsin Farmers Union. A 290cow dairy would get $4,905 but would lose several hundred thousand dollars.
Further, dairy farmers have only been getting about 25 percent of the average retail price for cheese, the lowest portion since 2012, according to Fischer.
More Wisconsin farmers are calling the Farm Aid crisis line
The stress farmers have endured in trying to keep everything together has been overwhelming, especially on farms passed down for generations. Nobody wants to be the one to close the gates.
Joe Schroeder answers the crisis line for Farm Aid, a group launched during the farm crisis of the mid-1980s and known for its annual concerts organized by Willie Nelson, John Mellencamp, Neil Young and Dave Matthews.
Schroeder has talked with farmers in the darkest periods of their lives. He’s kept some from committing suicide; he’s convinced others to get guns out of their house to avoid rash decisions.
These days, from his base in Cambridge, Massachusetts, he’s getting more calls from Wisconsin dairy farmers whose lives have gone off the rails.
The Wisconsin Farm Center, part of the state Department of Agriculture, Trade and Consumer Protection, has been getting about 200 calls a month on its toll-free crisis line.
The Farm Center offers farmers a wide range of free services including mediation with creditors. It also offers vouchers that farmers and their families can use to get counseling.
The agency looks to keep farms in business or find an exit strategy.
“We will come right to your kitchen table, or if you want to meet at a McDonald’s we will do that, too. It’s whatever you feel comfortable with,” Farm Center Director Kathy Schmitt said. “Some creditors will accept reduced amounts. And even if we can’t come to an agreement, being able to talk it through with them is good for the relationship.”