John Phipps: How Policy and Consolidation Continue to Impact Dairy Goat Farmers

USFR 10/03/20 - Customer Support

This e-mailer’s name has been withheld by request, but I think it makes an important point.

“I have been in the goat business since high school. Then started a goat dairy in 2004 milking commercially and sending the milk to a creamery in Wisconsin. In recent years there has been a monopoly buy out of two of the largest goat milk cheese creameries in the Midwest. That has dropped the price I received for goat milk from an average of $37 or $38 per hundred to now under the monopoly to $32. Every government program or whatever you want to call it doesn't help goats or goat dairies which with the monopoly and COVID-19, the goat dairies are going the way of the cow dairies – out of business. They are overlooked every time. Goats diets are mostly forage and hay is expensive.

We as dairy goat farmers in the U.S. have been told they can buy frozen goat milk curd cheaper from Europe and have it shipped in than they can pay us for our goat milk. Unlike most other livestock I don’t think dairy goat farmers have lobbyist out there or any real government officials keeping track of our situation.”

My expertise on dairy of any kind is minimal, but I would offer these points.

  1. Looking at the dairy goat growth curve, it seems inevitable that trendline could not continue indefinitely. Dairies may have over expanded. While processor consolidation is certainly a factor, simple supply and demand may be as important. And as the writer noted, virtually all food supply chains are in upheaval from Covid-19 as demand has been shifted from institutions like restaurants to consumers cooking at home.
  2. As I talked about earlier in the show, government programs have been notably ineffective in managing the problems described in this email. In addition, farm programs generate collateral damage. For example, hay prices are affected by massive corn and soy subsidies which attract acres that would otherwise not be row-cropped.
  3. Monopolies are a significant and growing problem for all of agriculture on both the supply and market sides. Our intense opposition to REGULATION helps these monopolies arise and grow.
  4. European imports may be subsidized and should be targeted in trade negotiations.

I appreciate the email and the reminder that there are kinds of dairy production in addition to cows. Like other non-program commodities, I respect goat farmers’ independence and self-reliance. We need more of that in ag.