MORRISVILLE _ New York dairy farmers are in deep trouble, victims of a price squeeze that is threatening to put many out of business.
According to the U.S. Department of Agriculture, ``Dairy farmers in the Empire State received an average of $11.50 per hundredweight of milk sold during June, down 40 cents from May and $7.40 less than June a year ago.''
From one perspective, the problem is simple: While it can cost about $27 to produce 100 pounds (about 12 gallons) of milk when labor costs are figured in, farmers are being paid less than half of that.
The more milk they produce, the more they lose, yet if they don't keep producing, they'll go out of business.
``It's incredibly stressful,'' said farmer Sam Dubben, 65, of Middlefield. ``If I hadn't grown up here and done this all my life, we'd be thinking of moving on.
``You can't make any money, so you get by on your equity until your equity is gone,'' he said. ``We're being paid what we got 30 years ago, but back then you could get a big tractor for $20,000.
``Now you're looking at $100,000, and the price of feed, the price of electricity, everything is much higher,'' said Dubben, who is also an Otsego County representative.
According to farmer Don Johnson, 64, of Columbus, ``I've been in this business 50 years, since I was a teenager, and this is the worst I've ever seen. This is going to put a lot of farmers out, especially the smaller ones.''
David Rama, who operates the Cattle Exchange, a livestock auction business in Delhi, finds the situation so alarming, he organized an emergency dairy meeting held Friday at SUNY Morrisville.
``It's like watching the buffalo disappear from the plains,'' he told an audience of 150 or so in the school's gymnasium, ``but back then they only had single-shot rifles.''
Because of ``improvements in technology,'' he said, farmers are being gunned down even faster.
``This is our (Hurricane) Katrina, and if we don't get together as a team, we've had it,'' he said.
Rama introduced the morning's speakers: John Bunting of Delhi, a dairy farmer and agricultural writer, and Kurt Williams, general manager of Lanco-Pennland, a dairy cooperative based in Lancaster, Pa.
The two men noted that even as depressed prices are being blamed on a glut of milk in the market, the United States continues to import milk products such MPC (milk protein concentrate), used to make cheaper cheese.
``All the big plants do it,'' said Bunting, because the admixing allows them to use 30 percent less milk.
Using traditional methods, processors can make about 9.6 pounds of cheese from 100 pounds of milk. By blending in lower-cost MPCs from abroad, they can make 13.72 pounds, he said.
``You can't keep up with a ratio like that, no matter how many cows you kill,'' he said.
South New Berlin farmer Ken Dibbell told the audience that American farmers, acting on the assumption that supply has outstripped demand, ``have sent 800,000 dairy cows to slaughter this year, and it hasn't raised the milk price a nickel.
``I think our civil rights are being violated,'' he continued. ``The American farmer is being discriminated against.''
State representatives attend
Among those listening were state assemblymen Peter Lopez, R-Schoharie, and Bill Magee, D-Nelson.
Both men said they were there to learn, to see if there was something they could do to improve the lot of farmers.
``I'm here because I chair the Assembly Agriculture Committee, but I think any realistic solution is going to have to come at the federal level,'' Magee said.
Among suggestions made at the conference was that Tom Vilsack, U.S. Secretary of Agriculture, raise the floor price of Class II milk (used for ice cream, yogurt and other products) and Class III milk (cheese) to $17.
A proposal made by Sen. Kirsten Gillibrand, D-N.Y., to raise payments under the federal Milk Income Loss Contract program also was supported. Those payments help farmers make up some of the difference when milk prices fall below a certain level.
Several farmers and others present railed against processors, the large companies that buy milk, for profiting while producers go down the drain. Bradd Vickers, president of the Chenango County Farm Bureau, noted that dairy processors are acting as businesses typically do.
``They want to buy low and sell high, make money,'' he said, and while the farmers' plight is easy to see, fixing it might not be easy.
``The pricing is so complicated that most people and a lot of farmers don't understand it,'' he said.
Farmer Cliff Brunner of Hartwick said the pricing is complicated because those making the big money don't want anyone to understand it.
'That's the last thing they want,'' said Brunner, who did not attend the meeting but said he kept tabs on it.
Organic conversion helped local farmer
Not too long ago, he said, he took bold steps to avoid disaster and converted his farm to an organic dairy.
``If we hadn't done that, we'd be one of those farms for sale now,'' Brunner said.
Although the organic market is somewhat depressed from the recession, Brunner is still being paid ``between $28 and $29'' a hundredweight.
``It costs more to be organic, but not that much more,'' he said.
Brunner said the real problem in the dairy industry is that a few large corporations are able to control the market.
``Whenever they feel like it, they lower the price and make a tremendous profit,'' he said.
Right now, farmers are hurting, but eventually, it will be consumers feeling the pain, Brunner predicted.
``When they get rid of the family farm and take over production, they'll be in a position to charge anything they want,'' he said.
Vickers, Rama and others at the conference expressed similar thoughts.
``This nation has had a cheap-food policy, but when the small farmers go out because of it, consumers are going to be in trouble,'' Vickers said.
As MSNBC noted May 25, milk processors and supermarkets see the dairy crisis differently from farmers, believing they deserve their profits.
``Last fall and summer, they swallowed losses because of high wholesale milk prices and government-mandated ceilings on what they can charge. They're now recouping some of what they lost and anticipating a rise in prices this winter, said Mike Nosewicz, vice president of dairy operations at Cincinnati-based Kroger Co.,'' MSNBC reported.
Kroger operates its own dairy processing division and sells milk through about 2,400 stores.
