MADISON, Wis. (SPECTRUM NEWS) — About 10 percent of dairy farms in Wisconsin closed in 2019. 818 total farms sold their cows in the calendar year.
This continues a roughly five-year trend of dairies folding under low milk prices in the state. Over the past five years 2,789 dairies have closed in Wisconsin.
“I want people to understand those are dairy farm families that sold their farms, and probably the majority of them it wasn't necessarily what they wanted to do, it was because of tough economic times,” said Shelly Mayer with the Professional Dairy Producers of Wisconsin.
Mayer said the closures don't just hurt the families forced to give up on the dairies, but also local communities and economies. They leave behind consumer capability, contributions to the tax base, and potentially land.
However, 2019 wasn't all bad for dairies. Prices went up about six dollars per hundredweight, a gain worth just under 30 percent. Most of that increase was in the second half of the year.
“2019 was not the worst year that we had in that whole stretch of bad years,” said Mark Stephenson, director of Dairy Policy Analysis at the University of Wisconsin- Madison.
Stephenson said a tightening supply market of milk contributed to prices going up in 2019. He also said the holidays will naturally give milk prices a boost because it is the time of year with the most demand.
So Stephenson calls the milk prices in November of 2019 — the most recent month they are available — a peak for the next few months. However, he says come springtime prices could start to come back up, particularly if the milk market supply stays tight.
Overall Stephenson projects 2020 to be a better year on average for milk prices than 2019.
“It's still an improving year for this next year,” Stephenson said
However, Stephenson also points out it's going to take more than a few good months to help farms that have weathered five years of low prices.
Mayer agrees. From her own farming experience and from talking to dairies around the state, she says many farms have spent more operating the dairy the last few years than they would make from selling the milk.
“It takes a long time to build yourself back up, and that's what I think is hard for people to understand is the level of resiliency and tolerance and our businesses have been very pressure tested,” Mayer said
Tested like Trifecta Farms and Katy Schultz. Schultz runs the farm with her siblings, they are the third generation in their family to run the dairy near Fox Lake, Wisconsin.
“It makes you humble that you're still in business and it makes us that are still here want to fight harder,” Schultz said.
Schultz said the past few months of better prices have helped them make improvements they haven't been able to in previous years.
However, she said more than a really good price, she could use a consistent one.
“For us and our family, just some kind of stability would be more beneficial than a higher price, a stable price,” Schultz said.
As far as trade agreements, Stephenson said recent trade news has been more of a moral victory than anything. He said the passage of the U.S., Canada Mexico Agreement is good, but won't change much as far as exports because dairy is heading to those countries anyway.
Stephenson also said that a first phase to ending tariffs with China is good, but it's not clear when or how it will happen. He said if China starts buying whey products from the U.S. It could have a positive impact on dairy prices.