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Dairy Dilemma

Farmers discuss the need for milk price reforms and why the farm bill could play a critical role

By Julian Emerson

Communications Specialist, Wisconsin Farmers Union

LINCOLN COUNTY – For all of his 53 years, Hans Breitenmoser has called a dairy farm tucked amid the scenic, rolling hills of Lincoln County, a half hour north of Wausau, home.

Breitenmoser’s parents arrived in Lincoln County in 1968, having moved there from Switzerland. They started their dairy business with 25 cows, a typical herd size in those days, back when dairy farms dotted the Wisconsin landscape like dandelions in springtime.

Hans Breitenmoser operates a dairy farm in Lincoln County on the same site his parents settled and began farming when they moved there from Switzerland in 1968. Breitenmoser has grown his operation and adapted new technologies to increase efficiencies to remain in business even as Wisconsin has lost about 40,000 dairy farms since 1980. But without changes to federal milk pricing policy, he doesn’t know whether he will be able to pass the farm onto his children. (Photo by Julian Emerson)

These days the farm Breitenmoser took over from his parents continues as a dairy operation, but on an entirely different scale than the one his parents started with. He currently has 450 cows on 750 acres, and he rents an additional 600 acres.

That growth during the past five decades, similar to what has occurred on dairy farms across Wisconsin and the U.S., has been necessary as dairy farmers have been forced to seek increased efficiencies to remain in business amid volatile and generally low milk prices and increasing operating costs. In addition to growing his herd and farm size, Breitenmoser is making other changes, such as collars that monitor his cows’ activity and health.

“Those changes are necessary because all the while, we have been dealing with thinner and thinner profit margins,” Breitenmoser said during a recent afternoon at his farm. “Costs continue to rise, and you have certain overhead expenses, so you have to look for efficiencies so you can remain in business.

Even with those changes and technological advancements, dairy farmers in Wisconsin – known as “America’s Dairyland” for the plethora of those farms the state was once home to – have been decimated. During the past 40 years Wisconsin has lost more than 40,000 dairy farms, and is losing more than one per day currently. According to the U.S. Department of Agriculture, the number of dairy farms remaining in the state in January 2022 numbered just 6,553, and more have disappeared this year.

Like many farmers, Breitenmoser hopes to one day pass on his farm to his children. But as Wisconsin dairy farmers continue to struggle with fluctuating, uncertain milk prices and higher input costs, he wonders whether that will be possible.

“It has to be financially sustainable for that to happen,” Breitenmoser said.. “Right now, without changes to dairy policy, I don’t know if that’s going to be the case.”

‘Doing Something Different’

Breitenmoser and other Wisconsin dairy farmers say the changes needed to keep more of them in business could happen through the federal Farm Bill scheduled to be adopted by Congress next year. The Farm Bill was last approved in 2018.

The U.S. Department of Agriculture and members of Congress have begun Farm Bill discussions, but those talks are preliminary and what might be included – or whether the measure will be approved next year – remains uncertain and could depend in part on the makeup of Congress following the Nov. 8 midterm election.

Breitenmoser was part of a delegation of Wisconsin Farmers Union (WFU) members and others from across the country who met with USDA officials and Congressional representatives during a visit to Washington, D.C. in September, during which they discussed provisions they would like to see included in the Farm Bill. Another group of dairy farmers, representing the collaborative Dairy Together movement spearheaded by WFU, traveled to Capitol Hill in July to share proposed solutions to the dairy crisis.

Among issues Breitenmoser and others are advocating for is growth management in the dairy industry. Currently, during times when milk prices are higher, farmers’ often respond by producing more milk, which in turn gluts the market and drives prices down. When prices are low, they are also driven to produce more milk, to compensate for lost income. That cycle creates an unstable milk price. Between unpredictable prices and tight profit margins, many farmers are struggling to pay their bills.

In addition, other Farm Bill issues WFU members advocated for are investing in meat processing infrastructure, strengthening regional and local food systems, enacting conservation issues, better enforcement of existing antitrust regulations, and enabling farmers to take advantage of carbon credits while reducing their carbon footprint.

Growth management, and specifically the Dairy Revitalization Plan, has gained growing support the past couple of years and has been a focus of WFU and some other farmer groups. However, others balk at the idea, saying it interferes with the free market system they back.

During WFU members’ visits with members of Congress, growth management received mixed reviews. Some lawmakers said the concept could be an important way to provide more stable, higher milk prices. According to a 2021 study by University of Wisconsin-Madison economists Mark Stephenson and Chuck Nicholson, dairy farmers would be receiving about $1.50 more per hundredweight if growth management had been adopted in 2014.

Others said they’re willing to consider growth management but noted the concept’s chance of being included in the next Farm Bill could depend on next month’s election results. Still others expressed concerns that itcould lead to higher costs for dairy products in grocery stores. Stephenson and Nicholson’s research indicates the increase in consumer prices would be minimal, with an increase of 15 cents for a gallon of milk or 11 cents for a pound of American cheese. The Dairy Together coalition notes that grocers are known to fluctuate prices frequently by far more than that during shifting promotions.

U.S. Rep. Mike Gallagher, a Republican of Green Bay, right, discusses possible changes to the federal farm bill scheduled to be approved by Congress next year with Wisconsin Farmers Union Government Relations Director Rick Adamski. (Photo by Julian Emerson)

“Given how dairy farmers continue to struggle in Wisconsin and elsewhere, we need to at least consider doing something different,” said U.S. Rep. Mike Gallagher, R-Green Bay, who in September 2020 partnered with Democratic U.S. Rep. Ron Kind of La Crosse to co-sponsor the Dairy Pricing and Policy Commission Act designed to recommend solutions to address Wisconsin dairy farming concerns.

As coordinator of WFU’s Dairy Together effort, Bobbi Wilson has heard firsthand from farmers the importance of improving the current milk pricing system. She sees adoption of a national growth management plan as the top priority in the upcoming Farm Bill if dairy farming is to remain viable.

“Without that, we will continue to see a lot of wild price swings and more periods of low prices, and more dairy farmers continuing to go out of business,” Wilson said. “We need to enact it now if we want to preserve dairy farming in the US.”

Dairy farmers’ struggles are receiving lots of attention, even on a national level, but Wilson worries legislators are not picking up on the urgency of the movement to save family dairy farms. She notes that Congressional members tell her they want to see unity in the dairy industry behind the idea before moving forward, while dairy insiders say they want Congress to take the lead.

“Right now I see a lot of uncertainty about who should go first,” Wilson said. “Each side is punting it back and forth. We need leaders who are willing to stand up and say this will be a positive thing for dairy farmers.”

Future Change Needed

During discussions with attendees of the Washington, D.C. fly-in and the subsequent World Dairy Expo in Madison, WFU President Darin Von Ruden had numerous discussions about the need to reform the dairy pricing system nationwide.

“We’re hearing from more and more people that the milk pricing structure is not working for far too many of us,” said Von Ruden, who owns an organic dairy farm near Westby. “Our dairy farmers continue to struggle. We need to come up with something better if we want them to be able to stay in business.”

Other dairy farmers expressed similar sentiments. Current federal milk pricing policy and other factors continue to force farms to grow ever larger to find greater efficiencies, a model in which they incur greater debts they hope to be able to pay off as they lack a stable income because of uncertain milk prices.

Tina and Duane Hinchley have found success dairy farming in rural Cambridge in Dane County. They currently milk 230 cows and give frequent tours of their operation as a way to boost interest in farming.

The couple plans to pass on their farm to their daughter Anna. But they wonder whether a farming future for Anna is possible given the economic pressures forcing so many dairy farmers out of business.

“It is a real concern,” Tina said on a recent evening as she monitored her dairy herd. “We’ve got to make some changes, show some more respect for farmers, or there are going to be fewer and fewer of us left.”

Hans Breitenmoser discusses changes he has made to his dairy farm north of Merrill with Wisconsin Department of Agriculture, Trade and Consumer Protection Secretary Randy Romanski on Oct. 12. Breitenmoser received a certificate from Romanski in recognition of National Farmer’s Day.

Breitenmoser is thankful that he is among Wisconsin farmers still making a go of it milking cows. On Oct. 12 he hosted Wisconsin Department of Agriculture, Trade and Consumer Protection Secretary Randy Romanski at his farm. During their visit Breitenmoser shared the history of his farm with Romanski and described how he has adapted his business to improve efficiencies, reduce adverse environmental impacts, and improve the health of his cows.

As rain poured down outside, Breitenmoser, standing near the cows in his barn, smiled broadly as Romanski handed him a certificate celebrating National Farmer’s Day. Breitenmoser said he hopes farm policy changes will enable him, and his children someday, to continue the way of life he cherishes.

“I don’t want to sit here and say that we’re doomed,” he said. “But if we don’t change anything, we’re not going to change this trend line of more farmers struggling and going out of business. And our best way of making those changes is through the Farm Bill.”

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