Anyone that’s been around agriculture for any length of time is familiar with the saying that “the cure for high prices is high prices.” Unfortunately that’s true as we see in the corn and bean markets and what may lie ahead for dairy prices. Right now dairy farmers are enjoying record high Class III prices for March and April but those prices look like they are moderating as we look at prices going forward. Production is rebounding across the country as dairy farmers work their way through some of the poor feed they put up last fall, keep more heifers back to increase the herd size and also slow culling rates in spite of high beef prices.
While prices are expected to fall somewhat as the year moves forward, they aren’t expected to fall drastically like they did in 2009 when prices dropped through the floor to the nine and ten dollar range. That pricing disaster prompted Darlington area dairy farmer Robin Berg to put together the Dairy Pricing Association (DPA) to help act as a kind of shock absorber to those low prices by getting dairy farmers around the state and the country to be proactive and prepared.
The group has been around now for the past four years and their mission statement is to create a demand for milk and dairy products and balance supply and demand when supplies get too high. Tom Olson, a dairyman in Jackson county, is vice president of DPA and he told us their organization is growing. Currently there are over 270 members in nine states. DPA is a not for profit group with a board of directors and undergoes an annual audit so all the funds can be tracked and accounted for.
Funding comes from member farmers who Olson says contribute “through a voluntary 10 cents a hundred check-off that is over and above the industry wide 15 cent check-off.” During times of high dairy prices, like farmers are currently enjoying, the money is “banked so it can be used when prices fall”, Olson said.
When prices do fall, DPA buys milk and dairy products from members’ dairy plants to give away for humanitarian purposes, Olson explained, “to food banks and homeless shelters to people who don’t normally get or can afford fresh milk and dairy products.”
The group gets the word out to dairy farmers about their efforts mainly through volunteers working farm shows, auctions and other events frequented by dairy farmers, and they have been successful enough so far that they have hired a full time office person at their Taylor, Wisconsin headquarters to handle the day to day business of the organization. This has been the first year that DPA has exhibited at the winter farm shows and Olson said they had good success earlier this winter getting their message and goals out to farmers at the LaCrosse farm show. They hope to expand their presence at more farm shows this coming winter.
Olson said when Berg first proposed putting such a plan in place their idea was to “buy milk and dump it on the fields as fertilizer, but farmers didn’t like that idea.” He said they told the organizers, “we can’t be dumpin’ milk. There are too many hungry, homeless people so let’s try and get it where it can do some good and feed people who don’t normally get fresh milk.” Another request of farmer members is that the milk stays in the state where it is purchased to help the needy there. They have purchased product and donated it to the needy all the way from California to the east coast.
While their goal is to provide support to the milk price, members want DPA to continue to buy and distribute fresh product even when dairy prices aren’t through the floor so they can keep their name in front of the public. Olson says that what they continue to do “when the right opportunities present themselves.” Last year the group purchased and removed 568,377 pounds of raw milk as well as thousands of pounds of cheese in their efforts to keep dairy prices up.
To get more information on the Dairy Pricing Association, go to their website at www.dairypricing.org.