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Milk prices squeeze dairy farmers

Marketplace Staff Aug 3, 2009

Milk prices squeeze dairy farmers

Marketplace Staff Aug 3, 2009


Bill Radke: Have you noticed that gallon of milk at your breakfast table is about 75 cents cheaper than it was at this time last year? Good news at the grocery checkout, right? Well, as Sarah McCammon reports
from NET Radio in Nebraska, it’s not so good for dairy farmers.

SARAH MCCAMMON: It’s milking time at David Jisa’s farm in eastern Nebraska. Ceiling fans stir the air. And flies buzz around the black-and-white Holstein cows as they file into the milking parlor, 30 at a time.

Jisa’s parents started this dairy farm after World War II. He’s run the farm since the early 1970s, and today he raises about 300 cows. But now, milk prices paid to farmers are at their lowest point in three decades. So Jisa says he’s digging into savings and borrowing money just to keep the dairy going.

DAVID JISA: I’d just shut the door right now if I could and just sit. What do you do with the cows? You can’t just dry cows up.

Some farms have been forced to shut their doors. The National Milk Producers Federation reports dairy farmers around the country are selling off part or all of their herds in desperation. Chris Galen is a spokesperson for the federation. He says the global recession is pushing down both demand and prices. That’s at a time when dairy farmers face high energy and feed costs:

CHRIS GALEN: So farmers are caught in a vice — It’s a price-vice, because low prices and the high price of inputs are really squeezing farmers right now.

The U.S. Department of Agriculture is taking emergency steps to prop up the dairy industry. It’s spending about a billion dollars this year in direct payments to producers and to buy milk products. The USDA’s David Lazarus says the goal is to help the industry deal with this period of low prices.

DAVID LAZARUS: It’s really this near-term gap that’s an emergency situation that we hope folks can make it through.

David Jisa says he’s receiving some support payments from USDA. About enough money to cover 10 percent of his losses. Outside his milking barn, the cows gather around a trough and nibble at their feed.

JISA: When they’re content they’re very quiet. If you’d come here and just sit down, sit on the edge of the bunk and not do anything, they’d be all petting you and licking you, rubbing their heads into you.

Jisa says he’ll keep feeding his cows. And hope milk prices bounce back soon.

In eastern Nebraska, I’m Sarah McCammon for Marketplace.

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