Outbreak sours business for already-reeling dairy industry
Schools, restaurants, institutions and universities closed to help slow the spread of the virus, wiping out much of the food service market that makes up for a big chunk of dairy farmers’ business.
Now farmers and cooperatives from Florida to Wisconsin to Maine are dumping milk because there are no plants that will take it and the price paid to farmers has collapsed again.
Plants set up to make food service products — like large packages of mozzarella cheese — aren’t able to pivot quickly and start churning out gallons of milk. Retail milk sales were up when the virus first hit as consumers bulked up on groceries but has declined since then, officials said.
“So dairy producers were really looking at 2020 to be the year they repair their balance sheets, and now they have a worse hit to their balance sheets than they ever actually experienced in those previous years,” said Alan Bjerga, a spokesman for the National Milk Producers Federation.
Dairy farmers expect milk prices to fluctuate, but typically they go in a three-year cycle.
The last slump extended longer, with fewer people drinking milk in part because of plant-based alternatives like soy milk, turbulent export markets and too much fluid milk for the demand. Cows don’t shut off, and fluid milk is highly perishable.
In the last five years, about 5,000 dairy farms have gone out of business across the country, and the ramifications of the virus outbreak will drive more to the brink, according to Cornell University agricultural economist Andrew Novakovic.
The couple that owns Darlington Ride Farms in Darlington, Wisconsin, come from long lines of dairying families and said earlier this month that they had been disposing of 15,000 gallons of milk a day for about a week — something they’ve never had to resort to before.
“It’s absolutely devastating,” Katie DiGangi said. “It’s devastating. It’s really hard for us and it’s hard for our family, and it’s really challenging.”
Farmers who belong to cooperatives get paid something for dumped milk, but it greatly reduces their revenues, Bjerga said.
To try to make do, Agri-Mark Cooperative, which gets milk from 840 farms in all six New England states and New York, has been churning out retail products since the virus hit.
It has also donated food service products — such as big containers of sour cream — to food banks.
“The retail market’s been stronger but certainly not anywhere near enough to make up for the loss of 50% of the business,” said spokesman Doug DiMento. “So we’ve been making cheese. We’ve been putting out more cheese in the last month than we ever have.”
Dairy groups and agriculture officials from some dairy-producing states have asked the U.S. Department of Agriculture to step in to support the industry and buy the additional products for emergency distribution.
It’s frustrating during a national emergency to see empty shelves or limits on milk purchases at a time when some is being dumped, said Dale Cole, who has a 90-cow dairy farm in Sidney, Maine.
“We want to sell it to people who need it,” he said. “It’s very frustrating for the farms.”