Welcome to NODPA's April 2009 E-Letter
Third Time is a – well definitely not a charm for organic dairies!
Some say that everything happens in threes – you don’t need the vet for months then suddenly you need him for not just one problem but three. And so it goes with organic dairy as Horizon Organic joined Organic Valley and HP Hood in lowering their pay price to organic farm families. When Organic Valley led with their price cut and increase in trucking charges at the beginning of February, HP Hood quickly followed matching their price cut starting in March. Horizon held off until the cows could smell the spring grass and have imposed a price cut starting in May. These cuts will directly impact organic farm family’s net income – their wages. An average organic dairy farm with 60 cows will lose anything from $5,500 to $10,000 (depending on who they sell their milk to) from their annual income.
While the economic situation is creating hardship for everyone, organic dairy farmers are particularly vulnerable to the changes in the price they get paid for their milk. Since 2001, the average price paid to farmers for their organic milk has increased by only 29% while operational costs have increased by at least 50%. This does not represent an adequate return for the skilled labor and capital investment of organic dairy producers nor does it leave any money to maintain their property, or build a “rainy day fund.”
Despite what the milk companies are saying, operating costs for organic dairy farms have not dropped significantly in comparison with 2008 costs. Some have sought to intimidate organic family farmers by highlighting how low the conventional milk price is. Two wrongs do not make it right!
“We see no value in comparing the exceptional low price paid to our conventional neighbors, except to point out that both are far below covering costs of production,” Henry Perkins, NODPA President, is quoted in the attached press release. While processors have been rushing to take on new farmers to supply their expanding market, they have not explored supply management, until after lowering their pay price. Milk companies prefer to lower the price they pay farmers to save money. The many mixed messages suggesting that farmers either reduce costs or lower their pay price is causing enough uncertainty that the next generation of organic farmers are questioning the long-term viability of organic dairy.
Vermont organic dairy farmer Craig Russell who sells the milk from his 75 cows to Horizon Organic, sums up his situation this way, “Even with the best plans and tightest budgets, when the company that you sell your milk to decides to arbitrarily lower your annual income by $16,000, it's difficult to know how we will survive,” says Craig, “We have been managing for the last year on a pay price that took no account of the increase in organic feed costs. I’ve "gotten more efficient" and "tightened my belt," I honestly don’t know what else to do.”
Organic was always meant to be something different for the land, for the consumers and for producers. We are seeing that materialize for the land and consumers, but producers are being subject to the same price and cost cutting as conventional dairy. Dairy and produce have always been cited as the entry point for consumers into organics; is dairy also the “canary in the coalmine” for how organic producers will be treated as the organic market matures?
Ed Maltby, NODPA Executive Director
Thinking Outside The Fence
Organic Dairy Looks to Robotic Milker to Increase Family Time Learn more >
DC Update, April, 2009
Access to pasture update, status of new appointees, and the generally positive outlook for organic in Washington. MORE >
June may be Dairy Month ...
... but not for organic family farmers that sell to Horizon Organic, who will see a pay cut of $1/cwt for their milk. NODPA urges consumers to buy more branded organic milk.
Grains for Forage
Cereal grains are a versatile crop that can be harvested for forage or grain. MORE >
Grain Market Update
Compared to two weeks ago, organic grain and feedstuff prices were steady on light demand and moderate offerings with trade at a near standstill. MORE >
of the Body
Behavior-Based Management for Animal Well-Being.
Check out our comprehensive listing of upcoming conferences, workshops and other events. Click here for details.
New Classified Ads: Updated April 1
Click here for the latest classifieds:
Land Certified turnkey organic dairy farm in Texas. 50 acre organic farm, Sheldon WI. MOSA certified farm near Eau Claire WI.
Employment Organic Dairy Herd Manager Position Available at Alfred State College. Herdsperson wanted for Seven Stars Farm, a 350 acre certified Biodynamic farm in Phoenixville, PA. Executive Director Sought at Merck Forest & Farmland Center, a not-forprofit corporation located in Rupert, VT. Assistant goat dairy herdsperson at Oak Knoll Dairy in Windsor, VT. Yogurt and cheese making help, and produce production help, at family dairy in Wyalusing, Pa. Looking for employment on a grass-based dairy. Pennsylvania Certified Organic is looking for a new Administrative Director. Forages & Grains Nofa-NY certified organic hay. Certified Organic Hay & Baleage for Sale in Central NY. PCO certified 1st, 2nd, and 3rd cut hay in small squares. 115 bales certified organic baleage-2nd cutting clover and grass. 1st and 2nd Cutting Grass Hay 4x4, NY. 100 roundbales of certified organic second cut dry hay available, NY. 100 roundbales of certified organic second cut dry hay available, NH. Wrapped 4x4 round bales grown with compost on mineralized soils, VT. 100 ton of triticale, 60 ton of rye, & 2 ton shell corn, NY.
Animals For Sale: 80 Holstein/Jersey/Normande mixed breed milking cows. Herd of Highway beef cattle. Dairy cows, certified organic--8 due in April. WANTED: Looking for Jersey heifers, calves.
Equipment Wanted: 575 New Holland square baler.