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Dairy Leaders Roundtable Update

Meeting at the Minnesota Milk Producers Association (MMPA) convention in St. Cloud, the Dairy Leaders Roundtable received good news and bad news.

Minnesota Agriculture Commissioner Gene Hugoson told roundtable members that Gov. Tim Pawlenty has chosen to focus his administration's energy on reviving the state's dairy industry. Hugoson said the governor and his administration will work to lower producers' business costs and create a more farmer-friendly operating environment.

Toward that end, the Minnesota Department of Agriculture (MDA) has taken a leadership role in educating dairy farmers about the importance of improving somatic cell counts. The MDA recently appointed Kevin Elfering interim director of the department's Dairy and Food Inspection Division. Elfering has said he will focus on educating producers and helping them comply with regulations.

The bad news from Hugoson is that the state budget crisis will likely mean reducing funding in fiscal years 2004 and 2005 for the Dairy Development and Profitability Enhancement program and scaled-back inspection schedules for certain dairy and food facilities.

There was also a mix of good news and bad news in MDA's presentation of results from its recent dairy farmer opinion survey. The Minnesota Agricultural Statistics Service (MASS) surveyed roughly 3,000 Minnesota dairy farmers in late 2002 and received more than 700 responses.

The survey shows that while serious challenges continue to threaten the long-term viability of Minnesota's dairy sector, there is also reason for optimism. One of the more encouraging findings was that nearly 300 respondents said they intend to make on-farm investments by 2007. The farms most likely to make major investments are those with 100 or more cows. MDA analysts project this on-farm investment could bring $53 million to rural Minnesota. Total benefits from these investments would approach 4,800 new jobs and $500 million in direct and indirect economic impact for rural Minnesota.

According to U.S. Department of Agriculture figures, the nation's top 10 dairy producing states average 232 cows per farm. Minnesota's herd average is around 70 cows per farm.

Other survey findings show that while the number of dairy farms will continue to decline in the next five years, the number of farm families involved in dairying will not drop as fast. The reason for this is that the average number of farm families supported by a particular farm is directly proportional to the size of the dairy herd. The smallest farms are the ones most likely to drop out of the business in the next five years, so the remaining farms are more likely to support multiple farm families.

D A I R Y I n i t i a t i v e s N E W S L E T T E R
Volume 12 Issue 1 Spring 2003