What we have learned from 2009

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This past year has been tumultuous, to say the least. You’ve had to deal with some of the worst economic conditions since the Great Depression.

Most of you have weathered the storm, although it’s taken a heavy toll.  And, like everything else in life, it has taught some valuable lessons.

Six dairy farmers look back over the past year and share some of the lessons they have learned. Here are their observations:

Don’t spend it before you make it

“We’ve been dairy farmers for more than 50 years, and 2009 is the worst and hardest I’ve ever seen,” says Gale Moser, owner of Moser Dairy in Whitney, Idaho. Like everyone else, Moser says he has been eating up equity to stay in business.

“This year, we’ve had to be more careful with our expenses. We slowed down on any improvements to the operation and did not replace any machinery this year,” he says. Despite all of these cost-saving measures Moser is not sure how much longer he can hold on; it all depends on when prices come back up again.

Moser says it really hit home for him this year how much the industry has changed. It’s no longer just a way of life, but a business. “We have to be businessmen or we will be left behind. Future dairy farmers are going to have to use the futures markets and contracts. Management is going to become increasingly important.” It’s not just about hard work anymore.

And being businessmen, he adds, dairy farmers need to plan for the future and be prepared for both the highs and lows. “Don’t think because prices are projected to get better, you should spend it before you have it. Manage your money well. Learn from this experience, because there will be a next time.”

Be thankful for what you have

It can be very easy to get down about the economy of our industry, says Brad Scott, co-owner of Scott Brothers Dairy in San Jacinto, Calif. “We still have our health, family and our operation and we’re still out there farming on a daily basis. That is a blessing in itself. I can still do what I love, despite the challenges.”

“There are other people in this country who have it far worse than we do. Be thankful for what you do have, and don’t sweat the little things. Just take it one day at a time,” he adds.

Scott says this year has made him question every practice on his operation to make sure it was absolutely necessary and ensure the operation was running as efficiently as possible. “You question yourself, but some things you can’t change because it’s better for the longevity of the farming operation. Any cuts we made we wanted to make sure they wouldn’t hurt us in the long-run.”

Don’t forget your family

Family is always important, but in times like these it becomes even more important, says Ryan Anglin a 300-cow dairy farmer from Bentonville, Ark. “Family is the only support you really have,” he notes.

“Employee loyalty has also played a role in our business surviving this year,” says Anglin. “Our employees have stuck by us; they’ve gone without raises, and have truly been an asset getting through this year.”

Looking to the future, Anglin says he is going to look at forward-contracting his milk and grain to eliminate some of the ups and downs of the price roller coaster.

Out of every negative comes a positive

We are probably more efficient than we’ve ever been, says Tara Davis, of TA-RO-LEE Holsteins in Chowchilla, Calif. Because of improved efficiencies, Davis says their cost of production is the lowest it has ever been.

“We adjusted our rations and emphasized forages. Our current average production is close to 9 gallons and our feed costs went down.” In addition, Davis notes that they also have fewer health problems. “Everyone got pushed to high-volume milk and focused on corn and other commodities. This is the ration we were feeding before that trend,” she notes. “We will most likely stay with this ration, depending upon hay prices in the future.”

The dairy has also increased its cull rate. “This has allowed us to improve our milk quality and remove any chronic mastitis cows from the herd.” In addition, if heifers don’t meet production standards, they are culled from the herd. As a result, Davis says, “the cattle that we are milking are elite in production and type; it is to our advantage in this economic down time that we are not feeding cattle that are producing significantly below average in our herd.”

Improved communication has also been a strategy in the operations success this year. “We’re a hands-on, family-run operation, but this last year communication within our family and with our employees has been essential in making our operation run at its highest efficiency.” 

Be open and honest

When your income has been cut in half, you definitely have to make changes to your operation, says Liz Doornink, co-owner and human resources manager for Jon-De Farms in Baldwin, Wis. The goal is to make changes that won’t hurt milk production or the health of the cow.

“We took a real close look at our labor situation,” says Doornink. “If an employee left, we didn’t replace him or her; we tried to readjust duties. Good communication with our employees made that possible.”

Doornink says communication has always been an essential piece of the management philosophy on the operation, but they found themselves being even more open and honest — in particular, when it came to finances. “When the (somatic cell count) bonus came, we did not turn that over to the employees as we normally would. We were very honest with them about our financial figures. We said, ‘hey we’re in this situation, here’s what’s going on.’”

This has been one heck of year, but Doornink says, “We’re stronger than we thought we were physically and emotionally. We will get through this.”

Don’t forget what’s really important

At times when milk prices have been in such a poor state, it’s easy to lose focus on the important things in life. “Our employees reminded us earlier this year how important it is not to lose focus,” says TJ Curtis, manager of Forget-Me-Not Farm in Cimarron, Kan.

One of the employees, Manuel Pichilla, learned that he had a significant-sized tumor in his stomach and needed surgery to remove it. This particular employee was in intensive-care for three weeks and off for more than two months.

“I was approached by one of our managers on the dairy. He said there were a few employees who would like to donate some money to Manuel and his pregnant wife,” says Curtis. He told the manager that whatever the employees raised the dairy would match.

The very next day, the manager came back to the office with a list of employees who wanted to donate money for Manuel. All 65 employees donated money, raising $1,200. “I was taken aback and touched that every single employee donated money,” says Curtis. The dairy matched the funds, which provided $2,400 to Manuel.

“It was truly a heart-warming experience for us as managers and owners to see our employees pulling together to support one another. We had never experienced something like this before,” says Curtis. “We are very proud of our employees for what they have done for Manuel and his family.” Manuel has a long road to recovery ahead of him, but he is back to work at the dairy, washing towels.



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