Creating New Markets For Dairy Farmers

      We all know the "plight" of America's dairy farmers. Over production has led to low milk prices. With the cost of fuel, feed, and other inputs as high as ever, family farms that have been milking for generations are folding. "Get big or get out!" is the rallying cry of efficiency, driven by trucking companies and processors who are under their own  financial squeeze. Whole herds of cows are being unloaded at the stock pen and only the best escape the slaughter house. Prices are dismal and a good heifer can be bought for a steal right now. BUT WAIT! What if I told you this doesn't have to be!
 

      We farmers hear all kinds of excuses. "Fluid milk demand is dropping!" "There is a worldwide milk glut!" "There is an oversupply!"
       FOLKS! I am here to tell you that is only half of the truth! Much more subversive forces are acting upon our operations. What is happening is not a surprise or some kind of random misfortune and the attacks on us are coming from our own marketing advocates. They send farmers their "cut off notices" with a suicide prevention hotline number! They pat us on the backs and say, "This is the way of the world." while they cut us off at the knees and think nothing of it.

      We are trusting the wrong people with our livelihoods.

      DFA, a wolf in sheep's clothing, poses itself as a nonprofit cooperative working on the behalf of farmers to get us the best price for our product. Instead, it acts like a cartel: buying up processors and shutting down competition. Wherever DFA goes, competition dies and milk prices are artificially depressed. As dairies all over the country have toppled, the management of DFA has walked away with millions. (Citation is on page 6 of lawsuit.)
       Our commercial dairy folded, under the weight of debt, 8 years ago.  We were working 16 hour days and basically paying to do it, while the cooperative that was buying and "marketing" our milk was linked arm and arm with Dean Foods. Ironically, Dean Foods was posting record profits while we were posting record feed debts! The alliance between DFA and Dean Foods to allegedly monopolize the market, ultimately, resulted in settlements of millions of dollars paid to Southeastern farmers. But for us, it was too late. The settlement paid to farmers was pennies on the dollar compared to what we lost and years too late to save our farms.

     Indeed, in a recent lawsuit between Northeastern farmers and DFA, farmers allege that DFA coerced and threatened farmers to accept the former class action settlement of roughly 4,000 dollars per farmer or face "the consequences". (Page 5 of lawsuit) It is doubtful that 4,000 dollars even covered the average loss for a farmer for even one month, meanwhile DFA would have saved millions in possible settlement costs.
     The bottom line is that we have entrusted our product and industry to those who profit off of our  labors and leave us wallowing in debt.

      Who is looking out for the dairy farmer? 

     While attending Kentucky's Milk Safety Conference last year, I got an insiders view into the challenges of our state's dairies, milk transport companies, and processors. The most unsettling bit is this- Kentucky is only producing about 40% of what our state milk processors use. The rest is SHIPPED in. And the shipped milk costs the SAME as local milk, courtesy of government subsidies! That means that when Dean Foods cut contracts with Kentucky farmers last year, there should have been zero issue getting these farmers contracts with different processors.
     Kentucky is not overproducing milk, and if not for government subsidies, milk would actually be in DEMAND. Why aren't our politicians on this? Why are our milk buyers selling northern milk to our local processors, at the expense of our farms? And why aren't we farmers doing something about this?

      Creating new opportunities for OURSELVES!

     Farmers! We have allowed ourselves to be led like lambs to the slaughter. Let us examine our operations and consider the options. How bad do we want to be dairy farmers? How much harder are we willing to work? We need a processor! We need a market for our milk. No one is going to save us. We are going to have to do this for ourselves and our families. 

     Down here in Barren County, Kentucky, we are trying to do just that. Right now, we are building a small cheese processing facility. We have had a lot of breaks along the way. A wonderful mentor, a facility to rent while we established ourselves, and an amazingly supportive community, have made this venture viable. Now we are looking to turn this around and be a starting place for other farmers to stay in the business. 

     Regulations and codes have become the largest barrier of entry into the dairy value-added industry. We farmers are a community and we need to be looking out for one another! Lets not wait until it is too late for our neighbors to hold on! Contact your extension agents, or if you are local, get in touch with us! Get together and find out how you can help each other build a hopeful future for the next generation.

     We can do this.

     We have worked hard, no doubt. We have packaged cheese into the night and right on through till morning to meet deadlines. We have slept in cars, eaten sandwiches for weeks on end, and faced one or two shut off notices. But this is our livelihood and we are going to fight for it! 

      We have built the facility itself with a $35,000 loan, which was facilitated with the help of the Kentucky Agricultural Development Fund. With the most basic equipment, a facility can be put together for about 20K. Lord willing, Kiva lenders will help us complete that funding. Getting in with KCARD has helped us get tips on funding, both federal and state, and on loans and grants. We can regain control of our industry and our product.

    

   We can't imagine living any other way, doing anything else. If you feel the same, we are here for you.           

Daniel and Keely Showalter

Maid-N-Meadows