AMES, Iowa – As producers have watched their forecasted pay price for milk on the farm fall by nearly $2 from year-ago levels, a national dairy marketing group is urging farmers to take another step in their supply management efforts.
“With predictions as low as $11.50 per hundredweight (cwt.) for Class 3 milk this year, prices could easily drop $2,” said Bradley Rach, dairy division director for National Farmers Organization.
“This, combined with increased fuel and fertilizer costs will severely strain dairy farm families economically.”
Thinking ahead. Because butter stocks are 27 percent higher than last year, and American cheese inventories are 8 percent greater, the national milk marketer is urging producers consider taking another step to reduce milk supplies.
“The Cooperatives Working Together (CWT) program has been an excellent resource for dairymen, but as we face lower milk price predictions once more, I think it may be time for producers to consider taking another step toward additional supply management,” said Rach.
A simple supply management option the organization recommends to producers is that they cull one cow for every 50 in their herd, helping to reduce domestic milk production capacity.
But the 51-year-old farm marketing group underscored the fact that a majority of producers nationally would need to participate in the program to maximize its effectiveness.
Look at this. The organization provided the following example for every 50 cows in a herd:
At a mailbox price of $15
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