This is not the Manhattan skyline. It’s the average price of milk paid to America’s dairy farmers between June 2012 and March 2018. Who can operate a business with price swings like this? Not surprisingly, many dairy farmers can’t. Between January and July of this year, 338 Wisconsin dairy farms stopped milking cows.
While sales at cheese counters appear to be booming and artisan cheese prices climb, many small American dairy farms face disaster. Steve Tate, the founder and former owner of North Carolina’s Goat Lady Dairy, believes that many farms won’t survive the latest plunge in the price they receive for milk —a potential crisis for the cheesemakers who depend on them. Williams Dairy, which supplies cow’s milk to Goat Lady, is among those threatened. Tate remains close to Goat Lady’s new owners and vested in their success, which explains the “we” in his replies below.
Is the low milk price purely about supply and demand?
Tate: These swings happen in the dairy industry, and the dairies that survive are the huge ones. The required size for economy of scale gets bigger all the time. Rick Williams told us that if we weren’t buying milk from him, he would have gone under. He’s getting $1.10 a gallon from the co-op, about half what it costs to produce. We buy a whole day’s milking, and we pay more than double the co-op price.
The harsh reality is that I can’t see any way for small dairies to survive without some value-added factor like selling to cheesemakers. The numbers just don’t work. Prices go up and farms add more cows, then the supply gets too big and prices crash.
Would you be in favor of a supply-management system for milk like Canada has?
Yes, of course, that’s what we need but we’ll never get that in America. I come from a corn-farming family in Illinois. Subsidies keep the farm in business, but we haven’t done that for other commodities.
What’s the answer for Williams Dairy and others like it?
If we purchased more milk, Williams Dairy could survive. We have ample capacity to make another cheese. The question is what would sell nationally? Is there room for another alpine-style cheese? What does the market want more of? If we commit to the milk, we have to be able to sell the cheese.
Boxcarr Handmade Cheese is about 45 miles from us, and they need more cow’s milk as well. We’re trying to come up with a business model so that we can both go to Williams Dairy and say, “If we bought this much milk, would that save you?” We’re afraid that the only way we can keep getting milk from Rick is if he can get a consistent price from cheesemakers.
This sounds grim.
It is very grim. The issue, in the starkest of terms, is that most of the small dairies are going to go out of business. Some could be saved if cheesemakers bought the milk. A lot of cheesemakers avoid these milk-price fluctuations by having their own herd, but we don’t have the land.
I see a lot of similarities between small dairy farmers and coal miners. They are both dying cultures. It may not be preventable, but people at least need to know about it.
Let’s Go to Tuscany!
October 23 - October 29, 2018
Please join me for this total immersion into Tuscany’s food and wine. Our home for the entire six-day experience is the luxurious Villa Valentina near Lucca. We’ll have cooking classes in the villa kitchen with Napa Valley chef David Verzello and cooking teacher Marjorie Perotti-Brewster. I’ll introduce you to the best Tuscan cheeses. We’ll visit Italy’s most famous butcher and salumi maker for lunch; dine at the Tenuta San Guido, home of the acclaimed Sassicaia wine; tour picturesque hilltop villages; and did I mention amazing cheese? The entire itinerary and booking details are here. I am beyond excited to share this experience with you!