U.S. Secretary of Agriculture Sonny Perdue held a town hall with a group of dairy farmers and officials at the World Dairy Expo earlier this morning. He emphasized the importance of exporting milk to other countries while pushing back on calls for government intervention to help stabilize the industry.
Perdue’s comments come at a sensitive time in a sensitive place. According to the Bureau of Labor Statistics, the average price of milk has gone up from last year–where it hit the lowest point in a decade–but it’s still well below a high point in 2014. This makes it harder for farmers to make money, which drives many of them out of business.
Last year Wisconsin had the highest number of farm bankruptcies in the nation. According to the Milwaukee Journal Sentinel, nearly 700 Wisconsin dairy farms closed last year, a rate of almost two a day.
Suicide among dairy farmers is on the rise — and they are more likely to die by suicide than the general population. Some cooperatives across the country have gone so far in recent years as to mail the number to suicide hotlines along with the milk checks that go to farmers.
When speaking before the state legislature earlier this month, Wisconsin’s agriculture secretary Brad Pfaff stressed that Wisconsin farmers are facing a perfect storm.
“The financial stress they are facing is a result of a triple whammy of low prices, international trade pressures, as well as the weather situation, causing even more stress in the countryside,” Pfaff said. At the town hall today, US agriculture secretary Perdue said oversupply has always been a problem.
“The problem with dairy…They say when dairy prices are low, you need to milk more cows to make up for it. And when milk prices are high, you need to milk more cows to take advantage of it” Perdue noted. “So that’s the problem we get with oversupply.”
That’s the case according to farmers who showed up at a press conference held by the Wisconsin Farmers Union. Among those who spoke at the counter-event was fifth generation dairy farmer Jerry Volenec, who runs Hard Scrabble Farms in Grant County with about 330 cows. He says his personal life is at odds with Secretary Perdue’s refusal to regulate the milk supply.
What I heard today is that there’s no place for someone like me…. There’s a laundry list of reasons for citizens producing milk…” Volenec said. “I’m at a point in my life where I could be the one to hang it up.”
But Perdue pointed to last year’s farm bill as a way to help out farmers who are struggling. The U.S. Department of Agriculture predicts that, under the 2018 Farm Bill, the government will give out over $400 billion to farmers during a 5-year period.
“[The] 2018 Farm Bill… I think they got it right. I hope you all signed up. That’s the best thing we can do. Prices are moving forward. I think milk prices will be improved over 2020,” Perdue said. “Frankly, farmers would rather have a good crop at a fair price than a government check any day.”
But while Perdue extolled the benefits of an industry reliant on trade with foreign countries, and cited recent efforts to expand dairy into Indian and Japan, it has become harder for dairy farms to export milk. Tariffs from China–part of an ongoing trade war–have made it less profitable for farmers to send their milk there. Doing business in Canada, otherwise the U.S.’s second largest trading partner, is unfeasible because Canada’s government manages its supply of milk…
Here’s how Canada regulates its supply:
The government sets yearly production quotas, then allows farmers to negotiate minimum prices with processors. Then Canada imposes high tariffs on imports to make companies use locally produced products.
President Donald Trump has condemned Canada’s system, saying that it’s unfair to American dairy producers.
But Darin Von Ruden– the president of the Wisconsin Farmers’ Union, said today that such a government program is exactly what the US dairy industry needs.
“Putting a supply management or inventory management program into place where farmers receive a decent price for the milk they produce and be able to cut back to meet consumer demand and get paid for that so they can pay their bills, that’s what farmers want to do,” Von Ruden noted.
“We’ve been trying that export thing for about twenty five years now, so if you think you’re going to be the last one standing, who’s going to be there at the bottom of the ladder to catch you when you finally fall too.”
The World Dairy Expo will continue for the next five days at the Alliant Energy Center in Madison.