Economy prompts 143 Michigan dairy farmers to quit | Michigan Farm News

Economy prompts 143 Michigan dairy farmers to quit

Category: Livestock, Markets & Weather

by Farm News Media

Cheese PLant_MFN_2018
The architect’s rendering of the new St. Johns cheese plant, unveiled at the official groundbreaking ceremony in August.

Aside from a mid-August groundbreaking for a new cheese processing plant in St. Johns, there’s little positive news to share from Michigan’s dairy sector. And even that news comes with a sobering reality - it will be at least two years before the plant is expected to start taking milk.

According to updated numbers of Grade-A dairy permits from the Michigan Department of Agriculture & Rural Development’s (MDARD) Dairy Division, the state has lost 143 dairy farms in the last 12 months.

According to Michigan Farm Bureau Livestock Specialist Ernie Birchmeier, MDARD figures show only 1,315 permitted Grade-A dairy farms as of Sept. 19 this year, nearly a 10 percent decline compared to Sept. 29, 2017, figure of 1,458 licenses.

“Ironically, the 10 percent decline in dairy licenses isn’t reflected in the latest USDA National Ag Statistic Service (NASS) report for August dairy production in Michigan,” said Birchmeier, noting that dairy herds in Michigan still produced 948 million pounds of milk during August, down just 6/10s of a percent from a year ago.

“Even with the state’s dairy herd estimated down by 1.2 percent at 423,000 head for August - down 5,000 head from a year earlier, we still are producing too much milk for existing processing capacity,” Birchmeier said.

While the 72.3 pounds of daily production per cow is up approximately a half pound from August 2017, Birchmeier said a study of the numbers hint at a more troubling symptom haunting Michigan’s dairy industry.

“The 10 percent losses in Grade-A dairy permit licenses, contrasted with a relatively minor 1.2 percent reduction in cow numbers and less than a 1 percent reduction in total monthly production, means those cows from the 143 operations that opted to get out of milking cows, are simply being relocated to other operations, and/or, they are being displaced by freshening heifers entering the state’s dairy herd,” he said.

According to the USDA NASS report, milk production in the 23 major states during August was up 1.4 percent from August 2017, despite the economic challenges and prices below cost of production, totaling 17.2 billion pounds.

The daily production per cow in the 23 major states averaged 63.7 pounds for August, almost 1 pound above August 2017 production. The number of milk cows on farms in the 23 major states was 8.74 million head, 3,000 head less than August 2017, but 4,000 head more than July 2018.