Jeffrey McNeely never thought he’d see fresh milk dumped into the same space he disposes of manure.
The third-generation dairy farmer from Brooklyn expected this year to be a rebound year for dairy farmers, after five years of low milk prices resulted in 800 Wisconsin dairy farms closing in 2019.
But COVID-19 shattered that hope.
Two of the largest markets for fluid milk and cheese are school districts and restaurants, which have either closed or been significantly affected by the COVID-19 pandemic. This surplus of milk has resulted in some dairy cooperatives, which oversee milk marketing for their members and handle shipping logistics, asking farmers to produce less milk.
Because cows still have to be milked, that results in farmers dumping excess. And the milk they sell is at a lower price.
Milk prices had begun to increase in November 2019 and were up to $21.30 per hundredweight (100 pounds) in December. That was up $5.10 from the previous year – a salvation for dairy farmers.
Then, at the end of March 2020, prices plummeted $4 in a week, Mcneely said.
“What really happened is it kind of shocked the whole supply chain,” Mcneely said.
McNeely, whose grandparents started Rollin’ Green Dairy Farm in the 1970s, milks 190 cows a day, producing roughly 16,500 pounds or 1,900 gallons. He received a letter from his co-op, Maple Leaf Cheese Co-op in Juda, to not increase production. He hasn’t been asked to dump nor reduce production yet.
However, neighboring farmers such as Craig Furseth of Stoughton and Sandy Larson of Evansville have been asked to reduce production. Furseth, who belongs to Dairy Farmers of America cooperative, was asked to reduce production by 10% starting May 1 through July 31. Larson, who sells to Grande production facility which makes pizza cheese, was asked to reduce production by 20%.
McNeely said the uncertainty is stressful.
“In my life, we’ve never had to deal with the uncertainty of, ‘Are you going to get a letter tomorrow saying you have to reduce production or dump your milk,’” he said. “That level of uncertainty is a whole different level of stress.”
Several organizations that represent dairy farmers have asked the USDA and local entities to help by buying the excess dairy products from farmers and give them to food pantries, nutritional assistant programs and other sources. And on Friday, April 17, President Donald Trump announced a $19 billion aid package to agriculture farmers.
As farmers wait for aid, the daily operations of dairy farms must remain relatively unchanged – the cows still need to be milked, regardless if there is a reduction in demand.
For McNeely, this means he is still milking his cows twice a day, except for Sunday night which he takes off to spend time with his one year old daughter.
Each cow eats more than 100 pounds of feed per day – and more if they are carrying a calf. Other expenses like feed bills, electricity, veterinary bills and payroll continue to stack up even as milk prices drop.
McNeely pointed out that each year he tells himself that next year the prices will be better, and he is again giving himself that same reassurance.
“Farmers are resilient, and we will come through this,” McNeely said. “But it does get tough.”
The reduction in demand has resulted in milk dumping around the state and nation.
According to the Wisconsin Farm Bureau and the Wisconsin Cheese Association, it is unclear how much has been dumped, as farmers are self reporting to the WDACTP. But there is plenty of anecdotal evidence.
The owners of Darlington Ridge Farms in Darlington reported dumping 20,000 gallons of milk per day, according to a CNN report. Golden E. Dairy Farms in West Bend reported up to 30,000 gallons of milking dumping, according to a WTMJ-4 news story.
McNeely and other farmers report that some cooperatives have agreed to collectively absorb the cost for the milk that is dumped among its members.
But other farmers, such as Sandy Larson, who owns a dairy farm in Evansville, are getting hit harder.
She said she will receive no payment for the 20% reduction in milk her farm was asked to weather for the rest of April and all of May. The Larson farm has roughly 2,500 cows and sells milk to Grande Cheese Company, which makes cheese for pizza.
“It is hard. It is just a rollercoaster of emotions if you stop to think about it – then it hits you,” Larson said. “Every day, we still have to come to the farm, we still have to get our chores done, we still have to milk them and take care of them. It is at night when you can’t sleep that it hits you – it’s hard.”
Larson and McNeely said farmers are finding alternative ways to reduce production, such as adjusting the ratios of feed – in a way that would not harm the cow, but produce less milk.
Farmers also can feed their calves more milk and start drying cows early – a term that refers to the time before a calf is born where the mother is not milked.
The two last resorts for farmers, Larson said, are selling their dairy cows and dumping their milk.
Cheese plant is a cheese plant
While school and restaurant markets are down, there has been around a 40% uptick in grocery sales the last two weeks in March, Dairy Farmers of Wisconsin CEO Chad Vincent said on the Midwest Farm Report.
Still, he said that does not make up for the reduction in the two largest markets.
And now that the market has shifted, some processing plants can’t switch operations on a moment’s notice. Facilities that used to turn out 50 pound bags of shredded mozzarella for restaurants are in the dark while ones that make gallons of milk for grocery stores are weathering the storm.
McNeely said plants that aren’t able to diversify their products can particularly struggle when facing a flooded market.
“Many processors are not set up to produce smaller packaging meant for retail,” he said. “No consumer would buy a 40 pound block of cheese or a barrel of cheese.”
While there is a surplus of milk in Wisconsin, consumers report seeing limited rations of dairy products in grocery stores to prevent hoarding. In an April 2 interview with Pam Jahnke of the Midwest Farm Report, Vincent called on industry leaders for grocery stores to stop limiting the amount of dairy products customers buy.
McNeely, who also has beef cattle at his farm, said he thinks COVID-19 has revealed problems in the large supply chain. He said running plants 24 hours a day and relying on the “just in time inventory” – a strategy to increase efficiency by receiving goods only as they are needed – might not be good for the industry.
“When we go and throw a wrench into a system like this – lets say like what we saw in North Dakota, where the slaughterhouses have to shut down for a couple of days ’cause they have workers that are sick – just a few percentage point swing in the system really affects everything,” Mcneely said.
Starting April 2, the Wisconsin Farm Bureau, Cheese Makers Association called on the USDA to purchase the excess milk from farmers and redistribute it to food pantries, nutritional assistant programs and other sources.
Under the direction of Gov. Tony Evers, the Wisconsin Department of Agriculture, Trade and Consumer Protection took a similar step the day before, stating USDA needs to secure the $104.8 billion impact agriculture has on Wisconsin’s economy.
“In a time when many people are already food-insecure, it’s more important than ever that we get Wisconsin’s nutritious commodities in the hands of consumers who need them the most,” Evers said in a news release. “I’m hopeful that our federal partners understand the urgency of the need here, and will take action accordingly.”
Two weeks later, the USDA announced its aid package. That is expected to make $16 billion in direct payments to farmers in May and include a mass government purchase of $3 billion in dairy, produce and meat products, Department of Agriculture Secretary Sonny Perdue said during an April 17 press briefing.
Another initiative that has started out of the calls for action is the Dairy Recovery Initiative.
A nonprofit out of Milwaukee, The Hunger Task Force, teamed up with the Dairy Farmers of Wisconsin and the Department of Agriculture, Trade and Consumer Protection to recover and distribute Wisconsin milk across the state.
The groups will purchase $1 million worth of milk from farmers and distribute it to food pantries, according to an April 15 news release.
McNeely said as solutions are being worked out, he will continue to milk the cows and provide quality food for families. That’s something dairy farmers have been doing in Wisconsin for decades.
“Buy local,” McNeely said in a message to consumers. “Buy Wisconsin dairy products.”