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Thread: Future

  1. #1

    Default Future

    https://www.progressivedairy.com/new...44ed7-87194909

    Any opinions after reading this? Is there room in America for dairies not shipping a semi load of milk per day or more? It's disheartening to read. We started in the end of 2008 basically from scratch and I just have to wonder what our future will be. We currently milk 250 cows, which is double from when we started, but I have to wonder if it will be feasible to continue in the future if we aren't able to expand at a faster rate.

  2. #2
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    Oct 2013
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    north-central virginia
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    The article says processors want to sign on a minimal number of farms for direct supply. Theoretically, they should be just as willing to work with a small cooperative instead of one large farm. Imagine 20 farms of 200 cows each, sign a contract with a processor to supply x amount of milk per day. The processor won't care whether the milk is being produced on one location, or 20 locations.

    Obviously, the overhead and headache of working together will cut into the paychecks of those 20 smaller farmers, but they can still compete with a 4000 cow operation. They will likely need to pay one or two salaried positions to manage the co-op, and their hauling costs will be a little higher.

    The main difference between this 20 farm co-op, and conventional co-ops, is that the paychecks of those 20 farms are heavily influenced by the performance of their co-op members. For example, one of the twenty can't just sell out tomorrow -- the group couldn't meet the terms of the contract unless somebody expands by 200 cows immediately. One of the twenty can't ship 600k scc milk. It would put the whole group over the terms of the contract. Even more importantly, one of the co-op members can't arbitrarily decide to double their herd size.

    Smaller farms can still work in the (dystopian?) future predicted in that article. It's just they will have to give up a lot of their autonomy that has until now characterized dairy farming. They will have to work much closer with their co-op members in meeting the needs of the contract.

  3. #3
    Join Date
    May 2015
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    45

    Default

    Do say 150-500 cow farms feel they're much more ahead in this compared to a 100 cow guy? In,the great scheme of things, that's "mid size" at most. Article in back of dairyherd magazine, said the 200-800 cow farms are going to,be the next ones to feel the hurt. 300,cows will soon be "small"

  4. #4
    Join Date
    Jul 2011
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    Kaukauna WI
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    Default

    The writing is on the wall.

  5. #5
    Join Date
    Nov 2006
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    1,008

    Default

    Quote Originally Posted by cousinit View Post
    The writing is on the wall.
    I think the writing is more than on the wall after getting a hold of my budget and future projections this morning!

    I'm thinking a bonfire where I burn the money up nice and quickly would be more fun than farming it away.

  6. #6
    Join Date
    Jan 2008
    Location
    Michigan
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    513

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    Quote Originally Posted by ElJefe View Post
    I think the writing is more than on the wall after getting a hold of my budget and future projections this morning!

    I'm thinking a bonfire where I burn the money up nice and quickly would be more fun than farming it away.
    The nice part about a bonfire is when the money is gone, the fire would burn out. Milking cows, you keep losing long after every penny is burned up. I agree totally, the handwriting is on the wall. Wish I would have seen it and acted long ago. Will be working for years after the cows are gone to fill in the hole that is my finances.

    **** the fools who've been adding cows the last few years anyway.

  7. #7
    Join Date
    May 2015
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    231

    Default

    Had an offer on Wednesday from a cattle jockey that we have sold springers to in the past. He wants to pick out 125 animals from our barn $1600 dollars each. They have a large order to fill. The offer is very tempting.


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  8. #8
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    Quote Originally Posted by wisjag View Post
    Had an offer on Wednesday from a cattle jockey that we have sold springers to in the past. He wants to pick out 125 animals from our barn $1600 dollars each. They have a large order to fill. The offer is very tempting.


    Sent from my iPhone using Tapatalk
    What % is that of your total cows?

  9. #9
    Join Date
    Feb 2013
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    1,310

    Default

    Was an add on Craigslist while back someone looking to buy 2700 cows for an expansion in February.

    I don't know where this is going, but I do know the experts have a poor track record when it comes to predicting the future.

    How many cows you milk is only relevant to point, then the laws of deminishing returns take over. No point in worrying about things you can't controle, there are plenty of things you can.

  10. #10
    Join Date
    May 2015
    Posts
    231

    Default Future

    Quote Originally Posted by cousinit View Post
    What % is that of your total cows?
    About 40% currently milking 280. The jockey said he has been on the road looking for cattle to fill this order but is having a hard time finding good animals. The buyer has certain specifications and most animals for sale arenít meeting them. He stopped in out of the blue it was kind of strange but he said he knows our cattle perform wherever he has sold some in the past.


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    Last edited by wisjag; 01-26-2018 at 12:54 PM.

  11. #11
    Join Date
    Apr 2011
    Location
    Central Valley California
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    437

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    Quote Originally Posted by cousinit View Post
    The writing is on the wall.
    You are looking pretty smart, selling out when you did.

  12. #12

    Default

    Futures are in the $13/$14 range in PA for the spring. Not sure how any size dairy will hold on.

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  13. #13
    Join Date
    Jul 2009
    Location
    texas
    Posts
    156

    Unhappy

    Quote Originally Posted by kipps View Post
    The article says processors want to sign on a minimal number of farms for direct supply. Theoretically, they should be just as willing to work with a small cooperative instead of one large farm. Imagine 20 farms of 200 cows each, sign a contract with a processor to supply x amount of milk per day. The processor won't care whether the milk is being produced on one location, or 20 locations.

    Obviously, the overhead and headache of working together will cut into the paychecks of those 20 smaller farmers, but they can still compete with a 4000 cow operation. They will likely need to pay one or two salaried positions to manage the co-op, and their hauling costs will be a little higher.

    The main difference between this 20 farm co-op, and conventional co-ops, is that the paychecks of those 20 farms are heavily influenced by the performance of their co-op members. For example, one of the twenty can't just sell out tomorrow -- the group couldn't meet the terms of the contract unless somebody expands by 200 cows immediately. One of the twenty can't ship 600k scc milk. It would put the whole group over the terms of the contract. Even more importantly, one of the co-op members can't arbitrarily decide to double their herd size.

    Smaller farms can still work in the (dystopian?) future predicted in that article. It's just they will have to give up a lot of their autonomy that has until now characterized dairy farming. They will have to work much closer with their co-op members in meeting the needs of the contract.
    Yes, processors do care whether milk comes from 1 farm or multiple smaller ones---When they mess up their end product, it's easy to pass the blame to your one supplier- how are they going to figure which of the twenty or more to blame?? Man, the blessing of shipping full tanker loads of milk from one dairy--- It's all about LIABILITY.

  14. #14

    Default

    Quote Originally Posted by wisjag View Post
    Had an offer on Wednesday from a cattle jockey that we have sold springers to in the past. He wants to pick out 125 animals from our barn $1600 dollars each. They have a large order to fill. The offer is very tempting.


    Sent from my iPhone using Tapatalk
    Holy crap that's a lot for springers. They weighed some up at the sale barn here 2 weeks ago. One was 8 months bred

    Sent from my SM-S903VL using Tapatalk

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