AmericanFarm.com

Prices continue to challenge state’s dairy operations

By RICHARD SKELLY
AFP Correspondent

RINGOES (Nov. 15, 2016) — It’s no secret among the state’s dairy farmers that milk prices have been depressed for several years now.
Things were so bad this past spring that young Jared Weeks predicted if prices did not rise again soon, we’d see another 10 or 20 dairy farms go out of business in New Jersey.
Weeks owns and operates Hun-Val Dairy in Ringoes. Now 30, he got into dairy farming right out of North Hunterdon High School.
He manages 200 cows, with a milking herd of about 50.
His single source pasture-based milk has proven a hit with people in Hunterdon, Mercer and Middlesex counties as well as locales even further away.
Weeks grew up next to a dairy farm in Asbury in Warren County.
He got involved working with cows through his local 4-H group.
“I developed a liking to it and it just kind of escalated from there,” Weeks said.
“Dairy farming is one big ball of wax,” Weeks said. “You have to like all of it, otherwise you’re not going to want to do any of it, it’s not like picking jelly beans out of a bowl, you can’t just pick the red ones out. Whatever you get, you get.”
Weeks uses land that was his wife Treacy’s grandparents’ farm. He lives just down the road from his operation, as the business of looking after cows affords no break in winter months.
This past spring, out of necessity, Weeks diversified his offerings and for the first time ever, raised and sold farm-raised vegetables at his stand and at nearby farmers’ markets.
“Everyone says there is a huge surplus of milk, and that’s the reason for the prices staying down,” Weeks said. “I’m not all that familiar with politics and international trade, but it doesn’t seem right to me that farmers in this country are getting paid less than what it costs to produce their product and we’re importing powdered milk products from other countries. It doesn’t add up to me.”
Weeks said he and his wife Treacy love what they do in bringing their popular single source milk to the public, he just wants to be paid fairly for his efforts.
As a dairy farmer, Weeks said he’s ready to work seven days a week, 365 days a year.
“I have no problem with that and we have some people we can trust here so we can get a couple of days off each year. But there’s too many guys out there who work too hard at it, for us not to break even.”
“I think if you talked to most dairy farmers in New Jersey right now, they’d tell you they’d be happy to break even, and right now, I can’t speak for everyone, but myself, having loans and payments, I’m operating at a two dollar a hundred loss right now,” he said noting it costs him 18 dollars to produce one hundred pounds of milk, for which he’s paid $16.
“It doesn’t take a genius to figure out that arithmetic,” Weeks said. 
In his favor, Weeks does have a farm store where he sells ice cream, eggs, yogurt and this past year, his farm fresh vegetables.
However, he doesn’t have the resources to staff the store, and people simply leave their money in the honesty box on the desk.
Weeks’ herd is about half Holstein and half Brown Swiss cows.
His wife Treacy oversees the Hun-Val Dairy web site and oversees stocking of items at the store.
Yet because of ongoing investments in machinery and repairs on milking machines that must be done, his overhead costs remain high.
They have no employees, Weeks said, adding, “everything I do, she does too, every morning she comes in and helps with the milking.”
Weeks has several wholesale accounts in Hunterdon and Mercer counties where he sells his bottled milk from the roughly 250 acres they farm.
“We have it pasteurized and bottled and the turnaround time from when it leaves to when it comes back is just about 24 hours.”
The Jersey Fresh logo is stamped on the jugs, he said.
Dan Wunderlich, coordinator of the Dairy Program for New Jersey’s Department of Agriculture, said there are 61 commercial dairy farms left in the Garden State, with most of them clustered in Salem, Gloucester, Sussex, Warren and Hunterdon counties. New Jersey now ranks 45th out of 50 states in milk production.
“Right now we’re at a low cycle again because there is a national and worldwide glut of milk. When that happens the price drops off, because there is so much extra milk right now there are some farms that did lose a market and it’s even hard to get into the market because no one is wanting that milk,” Wunderlich said.
“We’re in a downturn going on two years now, but the two years before that we were hitting some of our all-time highs on milk, and we’ve taken such a drastic plunge just when producers catching up from the previous downturn in the marketplace.”
Since he started work at the NJDA in 2004, “we’ve lost a few since and we’ve actually gained a few start-up herds since I’ve been working here.”
Wunderlich added since about 2010, New Jersey, Delaware, Pennsylvania and New York state dairy farmers have become more acquainted with an international market
“We’ve got Argentina and New Zealand which are very large milk producing countries, as well as the United States so when you have excess production, it depresses the price,” he said.
When foreign countries suffer severe weather events, “that’s when we get that high spike in prices,” he added.
Ultimately, for New Jersey’s dairy farmers, every farm is unique with its own set of circumstances.
“Every dairy farmer has to look at their own situation and look at his own cost of production,” he said. “Every farm is unique. They need to look at their costs of production, whether to cut back on production, exit the market for a while and come back, there’s a wide range of possibilities they can look at, but each farmer has to look at their own numbers their own costs, their own income.”
Dairy farmers can also look into value-added products like yogurt and ice cream, to capture more income as you take it through the marketing chain, Wunderlich suggested.
How deep must the dairy farmers’ pockets be in New Jersey to weather the current storm?
“It is challenging for them, because the lows affect a person more drastically than the highs do. You have to recapture some of that lost income when prices are higher,” he Wunderlich said.
He added there are resources to dairy farmers available through county agricultural extension agents and the New Jersey Department of Agriculture.
“There is a crop insurance program that could be a tool to protect the price of milk,” he said, noting there are also federal crop insurance programs available for the state’s milk producers.
“Each producer has to assess if their operation is right for their own participation,” he said.
Weeks said he knows more than a few people in their 20’s and 30’s who are interested in pursuing dairy farming for a living but worries the challenges in getting a dairy farm started are too great.
“If it wasn’t for my family and friends and all that, I would have never been able to get started,” he said.