Colorado’s herd retirement program is up and running and its goal is the same as most new dairy purchasing and selling decision—how to get the most out the herd to keep the farm going. The problem spreads across the nation and the globe. The situation has gotten to the point where Members of Congress are holding “field” agriculture hearings so they can learn first-hand from producers what the problems are—even if the problems are anti-trust practices by the biggest dairy purchasers.The goal of the Colorado herd retirement program is simple, “shore up prices for struggling dairy farmers.” The program is part of a 225,783-cow retirement that “removed 4.5 billion pounds of milk from the market stream nationwide in three phases this year.” The retirement in Colorado was the second largest “since the Cooperatives Working Together CWT) program began in 2003.” Christopher Galen has said the CWT program is funded by dairy co-ops and individuals in order to “manage production to make dairy farming viable.” The idea is simple, cutting production means less milk on the market, which means higher prices for milk. “Farmers and ranchers who want to participate submit a bid on the number of cows they want to retire. They are paid based on the previous year's production of the cows and on the value of the cows going to slaughter.”
There is an ongoing debate on whether such retirement programs can actually sustain dairy farmers in the long run. Farmers who stay in the business “should see a boost in prices by about 66 cents per 100 pounds of milk” according to Dr. Scott Brown of the University of Missouri’s College of Agriculture, Food and Natural Resources. Bill Wailes, head of Colorado State University’s animal sciences department think there won’t be any significant changes unless “100 percent of the nation’s dairy farmers agree to participate.”
‘“Right now, only about 70 percent take part, and you need full participation to get the benefits in higher prices,”’ says Wailes. Wailes also points out that consumers are paying about the same price per gallon of milk as they were in the 1970s.
For now, farmers have to make a decision as to whether or not they want to participate in the retirement programs.
To read the article from the Denver Post click here.
Posted: 09/28/09
