Milk glut has dairy farmers killing hundreds of thousands of cows in hope prices will rise -- chicagotribune.com

[Guest guest]

Send

 

 

 

 

http://www.chicagotribune.com/business/sns-ap-us-farm-scene-killing-cows,0,6920863.story

 

Milk glut has dairy farmers killing hundreds of thousands of cows in

hope prices will rise

 

MICHAEL J. CRUMB

 

Associated Press Writer

 

2:16 AM CDT, October 27, 2009

 

DES MOINES, Iowa (AP) - After burning through $1 million in savings

and seeing no end to their losses, dairy farmers Jake and Lori

Slegers figured they didn't have much choice - they had to kill the

cows.

 

So one day last summer their sons tagged all 1,571 cows, loaded them

onto trailers at their farm south of Fresno, Calif., and watched them

rumble away to a slaughterhouse.

 

Lori Slegers said her husband came into the house and broke down.

 

"He said it was the hardest thing he ever had to do," she said.

"Luckily, my boys could do it."

 

Growing demand in developing nations drove up milk prices when times

were good, and dairy farmers expanded their herds. But the global

recession hurt exports and left farmers with too much milk on their

hands. Milk processors cut the price they were willing to pay

farmers, in many cases below what it cost to produce milk.

 

In the past year, hundreds of farmers have come to the same

conclusion as the Slegers: The only way to raise prices is to reduce

the supply, and that means killing cows. In some cases, whole herds

have been turned into hamburger. In others, farmers have kept their

best producers and sent the rest to slaughter.

 

The Slegers turned to an industry-run program called Cooperatives

Working Together, or CWT, which pays farmers going out of business to

kill - rather than sell - their cows and help remaining dairy

operations by reducing the milk supply. Until this year, the

6-year-old program had paid for about 275,000 dairy cows to be

slaughtered. This year alone, it has paid for more than 225,000 to be

killed.

 

In addition, individual farmers are sending cows to slaughter at a

pace of about 55,000 per week, said Robert Cropp, a professor

emeritus at the University of Wisconsin. At that rate, about 3

million cows could be killed in a year.

 

Lifelong dairy farmers Keith Sammon, 55, and his brother, Mark, 53,

decided to sell their herd to CWT last summer after considering the

low milk prices, the cost of modernizing their operation and some

personal health issues.

 

Keith Sammon recalled the somber mood as he loaded the 80 cows onto

livestock trailers one Sunday morning at their farm in Faribault,

Minn.

 

"As we milked the cows ... it was pretty quiet, but then my son came

out with my granddaughter, who was 10 months old and she was just

beginning to walk around. Just having her around made it easier,"

Keith Sammon said. "We would load the cows for a while and then go

back and play with her for a while. It kind of took your mind off of

it."

 

The slaughter has helped some. Dairy farms pay CWT 10 cents for every

hundred pounds of milk they produce. As the cows have been killed,

the price processors pay for milk has gone up an average of 66 cents

per hundred pounds of milk, said Scott Brown, an assistant research

professor for dairy livestock at the University of Missouri-Columbia.

 

Consumers haven't seen prices go up because processors still pay

dairy farmers much less than the retail price, Cropp said. In fact,

grocery store prices may still drop some because the milk supply

remains much greater than the demand, he said.

 

That's because even as thousands of cows are killed and many farmers

call it quits, others are increasing their herds. In Wisconsin, the

nation's second-largest dairy producer after California, the number

of cows increased to about 1.25 million in August, up about 5,000

from the year before, according to state figures.

 

Most of the growth was the result of state tax credits and grants

approved a couple of years ago to help the industry modernize and

expand. When those credits were approved, the industry was booming.

 

Also, Wisconsin farmers haven't been hit as hard as those in western

states such as California, where farmers must buy more of their feed.

High feed, utility and other costs have compounded the losses created

by the drop in milk prices.

 

CWT spokesman Christopher Galen said most of the cows slaughtered in

the program have come from western farms.

 

For the Slegers, the future is cloudy. They are still farming corn,

sorghum and winter oats this year but are looking at moving away and

starting over. They're not sure what they would do.

 

"We still don't know if it was the smartest move we ever made," Lori

Slegers said. "One day, when the dairy business turns around, will we

kick ourselves? We promised we wouldn't do that."

 

 

Windows 7: I wanted more reliable, now it's more reliable. Wow!