CRESSON, Pa. — What Maggie Curtis had to say was too important.
So, she got up early on Aug. 12 and drove three and a half hours from her home in Warren County, to a dairy meeting with the top U.S. agriculture official and federal legislators, in Cambria County.
The meeting, organized by U.S. Rep. Glenn “GT” Thompson, at Mount Aloysius College, was organized for dairy farmers to learn more about the renewed dairy margin coverage program and other state programs.
It was also styled as a listening session for Sonny Perdue, U.S. secretary of agriculture; Russell Redding, Pennsylvania’s agriculture secretary; and U.S. Reps. Fred Keller and John Joyce. Local farmers, agricultural leaders and state FFA representatives filled the hall.
Not sustainable
When the time came for her to address Perdue, Curtis gripped the microphone and carefully read her prepared comments.
“I, as a producer, am bearing 90% of the cost of production. I receive about 40% of the revenue of the final sale of my product,” Curtis said. “This is not a business model that is sustainable for any industry and especially not for dairy farmers.”
She offered two solutions, short- and long-term, to the gathered representatives. “The (U.S. Department of Agriculture) sets the price of my product every month, using a formula that dates back to the early 1930s. It includes no cost of production figures. It relies to a significant extent on the information from processors.” She added that the numbers used in the formula have proved to be incorrect.
“So, sir, could you please go back to Washington and take a look at that formula, and make the processors be fair with me?”
Curtis, who milks 63 Jerseys with her husband and children and hosts a fledgling AM radio show, spoke of how her husband’s family had milked 300 cows and bottled on-farm. They made a profit, until they shut down in 1997. “Food production is a matter of national security,” she said. “For a long time now, we have been consolidating the processing of our product down to a very few corporate entities.”
Her long-term solution? More local, producer-processors, in the form of individual bottling facilities or cooperatives. “We need to give control back to the farmers over their own product and allow them to participate in the free-market, capitalist system,” she said.
She pointed out that as processors have had to tighten their belts as well, it makes them vulnerable to foreign takeover. “If a foreign entity owns our largest processor, and I don’t have any other choice as a producer, I’m going to be giving them my product, and they will be shipping it to themselves,” she said. “The trade agreements aren’t going to matter and I’m going to be working for the Chinese.”
Cash poor
Her comments prompted a question from Perdue. “What do you think are the impediments for more value-added production and processing, like you’re talking about?” he asked.
“Cash,” Curtis said immediately. Emotion clogged her voice as she shared her family’s situation. She wants to save her family’s historic farm. A neighboring processor plans to retire, but according to a business plan she put together through the state’s Center for Dairy Excellence, she needs at least $500,000 to take it over.
The opportunities are there for investment, Redding said in reply, thanking her for articulating a situation that many dairy farmers have faced or are facing.
“This re-discovery that society has about who’s feeding them is a really important discussion in dairy,” Redding said. “We’ve got existing channels, but what else can we do?”
Curtis’ situation echoes what dairy farmers have experienced over the past year. The U.S. Department of Agriculture has reported that the industry shrank by 2,500 farms and 100,000 cows in 2018. Milk prices paid to farmers have contracted for years.
Safety net
Despite the industry’s struggles, Perdue said in a later interview he is optimistic about the industry’s health.
“I actually think it’s a good time to be in the dairy business, starting here with (the 2018 Farm Bill),” he said. He encouraged dairy farmers to sign up for the current dairy margin coverage program before the end of September, calling it a “safety net,” particularly because of retroactive provisions that date back to Jan. 1.
“This is almost like betting on the Super Bowl the day after the game,” he said.
Redding agreed with Perdue, in his opening remarks. “What the (dairy margin coverage) does is provide some stability,” he said. “Let’s use that moment that we have some stability, to be thinking about what else do we need to do to make it better.”
Wake-up call
Last year, Dean Foods announced it was ending contracts with a number of Pennsylvania dairy farms. Redding said in a later interview that announcement was a “wake-up call.”
“Every single producer needs to know who they are doing business with,” he said. “The community also woke up. They want local products. They want local farms.”
Pennsylvania government and agencies have been examining how to evolve and adjust to the changing markets demands. “It’s in full partnership,” Redding said. “I think today is a good example that there’s a human on both sides of this discussion of dairy: the producer and the consumer.”
