Board hears grim report on dairy farms

WOODSTOCK – Dairy farmers continue to struggle in Shenandoah County and across Virginia, a new report shows.

The Board of Supervisors heard an update Tuesday on the dairy industry from Jeremy Daubert, the dairy science agent for the Rockingham County office of the Virginia Cooperative Extension. Daubert, who works with dairy producers and youth throughout the valley, provided the board with national, state and local numbers through 2017. Bobby Clark, with the extension office in Shenandoah County, asked Daubert to provide the update to the board.

Virginia lost 100 dairy farms in the past four years – from 600 to 500 or almost 20 percent between 2014 and 2017, Daubert said. The state also lost approximately 4,000 dairy cows in that time frame. Virginia has since fallen in rank in milk production from 23rd to 24th, Daubert said.

Shenandoah County has 13 dairy farms with approximately 1,500 cows. The county peaked in the early 1980s with about 3,700 dairy cows, Daubert said. The county has lost about three or four dairy farms since 2014, Daubert told the board. Page County has two dairy farms. Rockingham County has 200 dairy farms compared to 220-230 in 2014. Frederick County has about three or four, Daubert said.

District 5 Supervisor Dennis Morris asked Daubert to give the board some insight into the troubles facing dairy farmers.

“It’s sad,” Morris said.

The last year has been poor economically for dairy farmers, Daubert said.

“Imagine losing 40 percent of your salaries and working twice as hard,” Daubert said. “Most of the farmers I’ve talked to have cut back an employee or two if they had to, stretching their dollar as much as they can.

“It has a significant effect on the economy,” Daubert said.

The downturn also appears to affect local equipment dealerships, Morris added. District 3 Supervisor Richard Walker said many of the farmers he had as customers in the 1980s no longer operate.

The situation continues to occur nationwide but faster in Virginia, Daubert said.

The Virginia State Dairymen’s Association commissioned the Weldon Cooper Center for Public Service at the University of Virginia a couple of years ago to perform an economic analysis of the industry. The report showed that nine cows equates to one job and each animal contributes more than $13,000 to the local economy. Shenandoah County’s dairy producers provide 167 jobs and $19 million to the local economy, Daubert said. Twice as many cows would double the contribution to the economy, he added.

Milk production nationally has increased two percent per year on average but Virginia does not follow that trend, Daubert said.

“So you can see there’s a big difference between what milk production nationally is doing compared to locally here in Virginia,” Daubert said. “Of course this causes a lot of concerns because dairy farmers contribute significantly to the economy.”

The extension agent said he tried to find out why the dairy industry has experienced a downturn in Virginia. The average price of milk, based on data from the Dairy Management Institute, has fallen in Virginia, Daubert said.

“So Virginia farmers are losing (money) compared to everybody else in the country,” Daubert said.

Much of the problem stems from changes in consumption patterns, Daubert added. Total consumption of dairy products continues to increase, he said. However, consumers are buying less fluid dairy products such as milk. Virginia’s dairy producers traditionally focused on fluid products. Few producers process other dairy products such as butter, cheese or yogurt. Milk goes to Pennsylvania, New York, Ohio or other states to be turned into cheese and other non-fluid products then sent back to Virginia stores for the retail market.

“So that’s a lot of cost that’s lost to local producers because that milk has to leave the state, come back as a retail product to be consumed,” Daubert said. “So we have outdated processing capabilities.”

Virginia’s second-largest milk producer closed its Richmond operations last year, Daubert said. The majority of the milk that went to that plant now goes to North Carolina for processing.

Work on a statewide dairy-processing feasibility study through a grant from the Virginia Department of Agriculture and Consumer Services began this winter with seven counties providing a share of the cost. The study will look at what dairy processing the state can attract and where would a plant locate; what products can be made in Virginia and where can they be sold. The study also will look at what products could the dairy industry make in Virginia for export markets. Preliminary results should be available by September with the study complete by November, Daubert said.

Access to water and wastewater treatment remain the biggest obstacles to attracting dairy processors, Daubert said. Transportation and finding employees also can impede processors, he added.

Chairman Conrad Helsley asked if any area fluid dairy products go to Valley Milk in Strasburg. The plant receives some dairy products for processing, Daubert said.

Morris said that HP Hood once considered Shenandoah County for its plant but the locality could not provide enough water for its processing needs. The company ultimately located in Frederick County.

District 2 Supervisor Steve Baker asked that if the study shows positive results, the participants should look at creating a co-operative for dairy farmers. Daubert said they haven’t looked that far ahead but likely would try instead to attract a private entity to build a plant. Daubert said the state might have plants already constructed that farmers could use as a co-operative. However, history has shown that farmers who go in together to build and operate a plant don’t always succeed, Daubert said.