June 16, 2012 -
It's been 7 weeks since all the dairy cows and equipment were sold at auction (April 28th, 2012) brought on by the continued LOW milk prices and HIGH feed and operating costs that has plagued the dairy-farmer since 2009.
Low milk prices and high feed and operating costs are still hammering dairy-farmers, except now it's coupled with dairy-farmers having no more (or very little) equity remaining in their operations. Banks have been "pulling the plug" on numerous operation throughout the country to "stop the bleeding" of losses on the operations. Too much milk on the market causing too little milk checks for the dairy-farmer?
Processors and Co-ops have made huge profits over the past three years because of the low milk prices paid to dairy-farmers. However, the price of milk and dairy products in the stores have NOT been reduced to the consumer.
Processors and Co-ops continue to tell dairy-farmers NOT to reduce supply to increase the mail-box pay price to dairy-farmers. Dairy-farmers only choice available to them to decrease supply in-order to increase pay price, law of "demand vs supply", because the Processors and Co-ops need the excess milk for their export customers and to keep prices low for the USA consumers. It's crazy, they want dairy-farmers to keep producing milk at a loss so they can maintain their profits and customer happy.
Things will get very ugly over the next few months, any dairy-farmer left standing in the 4th quarter of 2012 will be battered and damn near broke, but they might see improved mail-box milk checks because of the hundreds (maybe thousands) of dairy-farmers that will go out of business over the next few months.
It's been 7 weeks since all the dairy cows and equipment were sold at auction (April 28th, 2012) brought on by the continued LOW milk prices and HIGH feed and operating costs that has plagued the dairy-farmer since 2009.
Low milk prices and high feed and operating costs are still hammering dairy-farmers, except now it's coupled with dairy-farmers having no more (or very little) equity remaining in their operations. Banks have been "pulling the plug" on numerous operation throughout the country to "stop the bleeding" of losses on the operations. Too much milk on the market causing too little milk checks for the dairy-farmer?
Processors and Co-ops have made huge profits over the past three years because of the low milk prices paid to dairy-farmers. However, the price of milk and dairy products in the stores have NOT been reduced to the consumer.
Processors and Co-ops continue to tell dairy-farmers NOT to reduce supply to increase the mail-box pay price to dairy-farmers. Dairy-farmers only choice available to them to decrease supply in-order to increase pay price, law of "demand vs supply", because the Processors and Co-ops need the excess milk for their export customers and to keep prices low for the USA consumers. It's crazy, they want dairy-farmers to keep producing milk at a loss so they can maintain their profits and customer happy.
Things will get very ugly over the next few months, any dairy-farmer left standing in the 4th quarter of 2012 will be battered and damn near broke, but they might see improved mail-box milk checks because of the hundreds (maybe thousands) of dairy-farmers that will go out of business over the next few months.
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