The impacts of dairy production and sale have a $2.2 billion impact on the Vermont economy according to state officials.
Wholesale prices are down significantly from last year’s record highs, and even a small change can have a big impact on the state economy.
In Weybridge, Monument Farms is home to 500 cattle that produce about 24 million pounds of milk a year or about 2.7 million gallons.
Thirty years ago, the farm operated on a much smaller scale.
«We were processing perhaps 40,000 pounds of milk in a week, and now we average about 65,000 pounds a day,» said Jon Rooney, Monument Farms president.
Like most of the 849 dairy farms still operating in Vermont, the operation grew to survive in a globalized marketplace, but unlike most, Monument Farms processes and distributes its own product and milk pumped there is largely sold in Vermont.
Rooney says they have not had to dump any milk because of falling prices as has been the case for those with St. Albans Creamery Co-op, Agri-Mark and Dairy Farmers of America.
«Certainly we are selling it for less than we would like to be selling it for, but as opposed to not selling it period, in that case we have to take pretty much whatever is offered,» said Rooney.
Vermont Deputy Agriculture Secretary Diane Bothfeld says last year producers enjoyed record prices, $25 for every hundred pounds.
This year, they’re being offered $16.
«Just those changes in prices really change the economy of our state,» said Bothfeld.
She says the dairy industry represents about 80 percent of Vermont’s agriculture industry and has a $2.2 billion impact on the state economy.
Bothfeld says dumping occurred in the past, but generally only when facilities closed over long holiday weekends.
UVM Extension Agriculture Economist Bob Parsons says this time it’s in higher volume, and the result of shipping costs exceeding potential revenue from a sale.
«So we dump the milk,» said Parsons. «It sounds wasteful, but there is a pure economics to it, when we’re hauling liquid milk that is expensive to haul.»
Parsons says while prices are down, they’re still better than 2009 and notes that feed prices remain lower than at that point in time.
He says many farms should be in decent financial shape making needed reinvestments during the two previous years of strong prices.
Parsons expects consumers to see better prices at the supermarket, but says they often lag behind wholesale prices and it may take awhile to materialize.
Source: WCAX