NNY loses 15 dairy farms in buyouts

While this year's third round of herd retirements through Cooperatives Working Together could mean the reduction of the milk supply to a desirable level, the loss of farms in the north country is having an unhappy economic impact.

"Coming into 2009, CWT's economists estimated that we would need to remove between five and six billion pounds of milk, the production of approximately 250,000 cows through herd retirements," Jerry Kozak, president and chief executive officer of the National Milk Producers Federation, said in a statement. The National Milk Producers Federation administers CWT.

Through its four herd retirements in the past 12 months, CWT has reached a total of 252,000 cows removed and a reduction of milk production capacity of five billion pounds, meeting the goal set at the beginning of the year.

In the August buyout, four farms were in St. Lawrence County and five each were in Jefferson and Lewis counties. The 14-farm total for the three-county area accounts for half of the farms accepted in New York state.

The intention of herd retirements is to curb milk supply, said Franz J. Vokey, dairy management educator at Cornell Cooperative Extension of Lewis County. Most dairy experts agree that a small reduction of milk supply can have a significant impact on the prices farmers receive, Mr. Vokey said.

Jefferson County Agricultural Coordinator Jay M. Matteson estimated CWT herd retirements have affected the price of milk by as much as $1.40 per hundredweight.

"I think that it is a valuable program that does help put somewhat of a dent in the whole milk supply and demand issue," he said

However, the loss of cows dramatically affects the local economy, Mr. Matteson said.

The Jefferson County Agriculture Development Corp. is aware of 10 farms in Jefferson County that have closed since January, resulting in a loss of 2,000 cows. Mr. Matteson estimated the economic impact in Jefferson County is $13,737 per cow per year, making a total economic impact of farm closures on the county $27 million.

"It certainly does impact our local economy when it happens, but our local economy is also impacted when milk prices are low," Mr. Vokey said.

Milk prices reached lows of $10 per hundredweight this summer. With farmers paying average production costs of $18 to $19 per hundredweight, farmers with a 500-cow dairy were losing $30,000 monthly, Mr. Matteson said.

Milk prices are inching up, but Mr. Matteson said he estimates farmers will not be breaking even until mid-2010.

Farmers who participate in the voluntary program have 15 days after their acceptance is finalized to send their animals to slaughter. After that, farmers agree not to engage in commercial milk production and marketing for the following 12 months. Farmers who break the agreement are penalized 10 percent of their bid.

Most herd retirement participants use the program to move into retirement or to raise other crops and livestock, owing to difficulties refurbishing a dairy business after a year's hiatus, Mr. Matteson said.

"For people who might be thinking about exiting dairy, for whatever reason, it's a lot better deal than to just throw your cattle on the open market," said Charles L. Eastman, a partner in Eastman Farms LLC.

Farmers will be notified by CWT no later than Nov. 16 as to whether their bids were accepted for the third round of herd retirements in 2009.

CWT is funded by dairy cooperatives and individual farmers, who are contributing 10 cents per hundredweight assessment on their milk production through December 2010.

Cooperatives Working Together has tentatively accepted 154 bids in this year's third round of herd retirements, totaling more than 26,000 cows and 500 million pounds of milk. CWT will not release regional data, so the number of farms accepted in Northern New York is not available.

FARMERS NO MORE

According to the CWT Web Site, 14 farms from Jefferson, Lewis and St. Lawrence counties were accepted in the second round of herd retirements in August.

■ Dale and Kathleen Tamblin, Adams

/ Frank Crosby, Brier Hill

/ Neil and Cathy Thomas, Canton

/ Rick and Sheila Lawrence, Cape Vincent

/ Karl Roggie, Carthage

/ Paul and Howard Waite, Carthage

/ Michael Lyndaker, Castorland

/ Robert and Judith Scoville, Copenhagen

/ Wendell Woodruff, Copenhagen

/ Brad and Melanie Knight, Lisbon

/ Dale Kloster, Lowville

/ Darren Basford, Potsdam

/ Garylaine Farm, Turin

/ Gary Smith, Watertown