“We’ve seen a lot of ups and downs and a lot of changes,” said Holterman, owner of Rosy-Lane Holsteins LLC.
Record high prices paid to dairy producers combined with record low feed prices made it a very good year for a very important industry in Wisconsin.
“This is an exciting year, the best year in our history,” Holterman said. “The last time prices were this good was 2008 and right behind that came 2009. I don’t see next year being quite as bad as 2009, but it could get pretty low by spring.”
Holterman, like many dairy farmers, utilize the profits from a year like this to improve technology of their operations and improve efficiency. That improved efficiency helps them make it through the down years.
Dairy prices this year were driven by strong foreign exports, including new markets in Asia. The dairy industry has also seen a steady growth in consumption of cheese, yogurt and butter over the last 20 years.
While there has been steady growth in consumption of some dairy products, milk has seen a steady decline in recent years.
To counter that decline the dairy industry is investing $500,000 to develop new products and innovative new packaging. They are working to develop packaging that does not require the milk to be refrigerated until opened. The goal is to market milk to changing demands from consumers.
“The consumer is not buying that gallon jug of fluid milk anymore like they used to. Changing life styles have a lot to do with that. Just take a look at a fast food place where people are getting breakfast. It used to be that breakfast was at home and a jug of milk was on that table,” said James Robson, CEO of the Wisconsin Milk Marketing Board.
While dairy farmers saw significant profits in 2014, history shows it has a way of balancing out when weighed against down years. Through it all, the success of the dairy industry is tightly tied to the economy of Wisconsin.
“The economic impact of dairy in Wisconsin, of just dairy not total agriculture, is $43 billion. About 400,000 jobs in Wisconsin are tied to dairy, so no matter what business or profession you might be in, if you’re in Wisconsin you are related to the dairy industry,” Robson said.