North Dakota’s dairy industry continues to dwindle, and the COVID-19 pandemic has made things that much harder.
“That’s a very frustrating thing as a farmer to know what we’re getting paid and to see what is happening in the grocery stores and then it doesn’t trickle down,” said dairy farmer Kristie Klusmann.
It’s been a sour few years for America’s dairy industry, from sales slumps thanks to milk alternatives like almond or soy milk, to bankruptcies of major corporations such as Dean Foods.
It seems the dairy business was already fighting an uphill battle, and that’s before the COVID-19 pandemic hit.
Yes, it caused a huge demand for what’s called “liquid product”, but the gains from that were offset by huge losses because demand for dairy collapsed when schools, restaurants and other milk-friendly businesses closed.
And while your huge milk corporation can eat some of those losses, your local farms, like many across North Dakota are on life support.
“The operations of 250 or less cows they just can’t compete, their break evens are often times north of 19 or 20 dollars per hundredweight depending on if they’re including their own personal time and labor. And so when you look at that this market is not allowing them to continue, we’ve had four negative years of very harsh economic landscape,” said Dan Besse of AgResource, an agricultural market research firm in Chicago.
Besse tells KX News one of the biggest issues is large milk conglomerates making money at one end but passing the profits onto the producer with tweezers on the other end.
Head just north of New Salem and you’ll find Ashgrove Dairy run by Klusmann and her husband.
“Even though the milk prices have recovered, there’s some other expense’s that are coming in that get minus’ed off of our check because of the huge fluctuation from up to down and so for the next two months, they’re saying the prices are still going to be really tough for the dairy industry,” said Klusmann.
They run a small dairy farm on just a few hundred acres of land.
She adds that they and other farmers have considered getting out of dairy, but there’s no market for their animals, so they’re forced to keep pressing on, and what’s especially frustrating to her is seeing empty store shelves.
“We know that the product is there, it’s a packaging problem, and so it’s frustrating to see that they’re limiting people. I don’t think they are so much now, but at the height of the pandemic they were limiting people to one gallon at a time and we know that the product is there, so that’s really frustrating,” said Klusmann.
She said the way things are going now, in five years, there may only be a dozen dairy farms left across the state — compared to around 50 now.
Industry experts say while prices should remain high for the next two or three months, after that is anyone’s guess.