Friday, June 24, 2022
CapitalPress.com 9
Panelists consider deregulation of milk
By CAROL RYAN DUMAS
Capital Press
Dairy economists and oth-
ers addressed the modernizing
and improving the Federal Milk
Marketing Order system in a
panel discussion during the latest
DairyLivestream webinar.
Most in the industry agree
changes are needed. But the issues
are complex, with a change in one
area of the system bringing conse-
quences in another area.
Panelists noted that there’s a
lot of thoughtful discussion taking
place, and the industry is working
toward consensus.
“We’ve got our work cut out for
us,” said Mike Brown, dairy supply
chain director for Kroger Co.
In addition to updating make
allowances for processors and
addressing Class I milk pricing and
depooling of milk, the panelists
gave some insight on what a mod-
ern market might look like without
federal orders.
“If you’re going to run a truly
competitive market, you have to
have reliable information. That’s
kind of econ theory 101 … and
we all know market information
is far from perfect,” Brown said
during the latest DairyLivestream
webinar.
But federal orders provide pro-
duction levels, breakdowns on milk
components and prices for base
products through large volume sur-
veys, he said.
“That’s all very, very important
… that kind of information needs
to continue to happen to have a
market that works, in my opinion.
How we regulate it is the big dis-
cussion,” he said.
Roger Cryan, chief economist
for American Farm Bureau Feder-
ation, said without federal markets,
the dairy industry would look a lot
like the broiler industry.
“I think it would be tough for
farmers to make their own deci-
sions,” he said.
Federal orders provide support
for independent farmers and coop-
eratives because a pooled plant has
to pay the federal order minimum.
That takes away the incentive for
processors to get involved in man-
aging farm production to minimize
costs, he told Capital Press.
“Without that minimum price,
broiler integrators can microman-
Made in the shade
Oregon dairy plants trees
for cows to keep cool
By GEORGE PLAVEN
Capital Press
Sierra Dawn McClain/Capital Press
Many in the dairy industry believe the Federal Milk Marketing Or-
der system needs to be reformed, but there’s differing opinions on
what changes should be made.
age the growers’ production to
minimize unit cost then capture the
benefits.,” he said.
So the federal orders do a lot to
help dairy farmers be the masters of
their own fates, he said.
Mark Stephenson, director of
dairy policy analysis at the Uni-
versity of Wisconsin, took some
exception to that viewpoint, saying
he doesn’t think the industry would
immediately go to something that
looks just like a broiler industry.
“But I do think that one of the
very first things that would happen
is that you would find farmers and
you would find processors running
toward each other to secure con-
tracts for that milk,” he said.
Andy Novakovic, agricultural
economist with Cornell Univer-
sity, said “If you’re talking about
no regulation, you’re going to look
at a lot more vertical integration, a
lot less transparency.”
It isn’t necessarily going to be
like the poultry industry. It could
be farmers going up as they did in
the United Kingdom or it could be
Kroger going around to farmers
and skipping the guy in the middle,
he said.
“But it would be a bit wild, wild
West out there,” he said.
Stephenson said he tends to
agree but thinks there would be
intermediate steps.
“The unfortunate thing is those
may not be big enough to solve
all the problems. But they may be
incremental toward relieving some
of those problems,” he said.
Brown said the industry could
survive a system without regula-
tion, and it’s kind of already going
the way of the poultry industry
with vertical integration in cooper-
atives and farms getting bigger and
bigger.
“If you’re going to have a system
that really provides orderly market-
ing, it needs to include more milk,”
he said, referring to the depooling
of milk that causes disruptions.
It also can’t by regulation force a
processor into large negative profit-
ability, and it needs to make pool-
ing less onerous, he said.
PEDEE, Ore. — A small herd
of dairy heifers grazed in the
distance as Jon Bansen ambled
toward a row of tree saplings
bisecting the grassy pasture next
to his home in the tiny Willa-
mette Valley outpost of Pedee,
Ore.
Bansen planted these trees
— a mix of bigleaf maples and
poplars — in January to provide
shade for cows after a brutal
summer in which temperatures
rose as high as 116 degrees.
“Last year was the toughest
year we’d ever been through,”
said Bansen, who runs Dou-
ble J Jerseys, an organic dairy
and family farm in rural Polk
County. “That was the toughest
summer by a mile, it was so hot
and dry.”
Double J Jerseys produces
exclusively grass milk for
Organic Valley, the country’s
largest farmer-owned organic
co-op. Grass milk means the
cows eat only grass, and no
grain.
It also means the cows spend
their days grazing in open pas-
tures, rather than being kept in
barns. That poses its own set of
challenges, including keeping
the animals comfortable in the
elements, Bansen said.
He described the past two
years as seemingly one plague
after another. First came the
Labor Day wildfires in 2020,
which sent up smoke so thick it
blotted out the sun for 10 days
and affected the cows’ health in
strange ways.
“We saw it in hoof health,”
Bansen said. “We had a lot more
lameness issues, and so did
every other dairy that was in the
path of that smoke.”
An exceptionally dry spring
in 2021 not only stifled for-
age production, but prompted
the vole population to explode,
causing more damage than
usual, Bansen said.
That led to the summer “heat
dome” from late June to mid-
July that sent temperatures soar-
ing across the Pacific North-
west. The combination of less
grass and distressing heat took
its toll on the bottom line, Ban-
sen said.
“With more heat, the cows
are less comfortable,” he said.
“They’re spending a lot of
energy trying to keep cool,
instead of making milk.”
Planting trees was one way
Bansen said he could address
the situation, while providing
additional benefits to the land.
Bansen has already planted
eight rows totaling more than
1,000 trees in his dairy pastures,
with three more rows still to go.
Each row runs north-to-south,
casting diffuse shade throughout
the day as the sun rises in the
east and sets in the west — sim-
ilar to a sundial.
In addition to bigleaf maples
and poplars, Bansen said they
are trying several other species
including white oak and quak-
ing aspen. A few rows have been
interspersed with thick shrubs
such as red osier dogwood and
snowberry, attracting wildlife
and pollinators.
Once they are big enough,
Bansen said shade from the
trees will provide much-needed
relief for both cows and grass on
hot days.
“The job for our cows,
because we’re a grazing dairy, is
out here. It’s not in a barn,” he
said. “I need to be able to keep
them out on the pastures as long
as possible through the days,
and that includes the hot, sunny
days.”
Beyond providing shade,
Bansen said the trees will
sequester carbon and replenish
organic matter in soil as leaves
fall to the ground. They also
improve wildlife diversity on
the farm, including natural pred-
ators of voles that can keep the
rodent’s population in check.
Though it will take years for
the newer seedlings to reach
maturity, Bansen said it is a
long-term investment in the
health of his operation.
“Cows and trees just go really
well together,” he said. “Plus,
consumers love trees. There’s
no doubt about it.”