Facts of life: Farm declines are an ongoing trend

CHENANGO COUNTY – The disappearance of the family dairy farm, like small business, is a fact of life in America’s economy, said a federal agriculture official in a July correspondence with a local farmer.

Responding to a letter questioning milk pricing policies sent by former South New Berlin farmer Ken Dibbell, a representative from the U.S. Department of Agriculture said stabilizing milk prices won’t keep small dairy operations in business.

“Consolidation and larger-sized operations are a constant in our economy – not only in agriculture but in business in general – as producers expand to capture economies of scale,” wrote economic analyst Joy Harwood in a July 20 response sent on behalf of USDA Secretary Mike Johanns. “Producer exits from dairying have been occurring for at least 60 years and would not likely be stopped, or slowed significantly, even with somewhat higher milk prices.”

“That’s outrageous,” said Dibbell in a telephone interview Monday. “We’re killing the country – first the rural communities and then the counties, where rural milk dollars go a long way – we’re killing rural economies like Chenango County’s and people like Joy Harwood think that’s OK. What’s happening here is a real problem.”

According to the New York State Department of Agriculture and Markets, for every job created on a dairy farm, 1.24 jobs are created locally and for every dollar of output from a dairy farm, $.83 is spent in the community.

Record low milk prices in 2006, bad weather, high fuel and feed costs, and increased debt, however, have pushed many local farms to the brink of folding, several area farm organizations contend. According to figures from the USDA, 460 dairy farms closed in New York state last year alone.

Dibbell claims greed has knocked dairy families off a level playing field in the industry, arguing they should be paid for their milk based on what it cost to produce – which means figuring in feed, energy and equipment costs.

The money paid to farmers is currently set by the federal government, and at times during 2006 and 2007 has only been around half of what the cost of production was, according USDA figures. Milk prices are currently situated at around $22 per every hundred pounds, while the cost of production has been hovering at $24 per hundredweight.