Editor’s Note: This is one article in a series that is included in the 2024 Farm Journal’s State of the Dairy Industry report. The full 16-page report will appear in the May/June issues of Dairy Herd Management and Milk Business Quarterly and will be published in this space over the next several weeks. To download the full report for free click here.
The dairy industry has certainly changed from the era of handmilking cows one-by-one. In the past decade alone, change has come at lightning speed. From technology adoption and increasing efficiencies to overcoming challenges that seem to come at a rapid pace, dairy producers have rolled up their sleeves and leaned forward to embrace opportunities to advance their farms.
Today, the industry has a growth mindset, shared Michael Dykes, CEO of International Dairy Foods Association (IDFA), at the Dairy Forum in Phoenix earlier this year.
“Our farmers want to grow, and so do our processors. If we aren’t growing, if we aren’t looking toward the future, we’re going to get surpassed by others,” he says.
Sixty percent of processing executives have expressed optimism for 2024, Dykes adds, and 73% plan to increase their investments over the next three to five years.
Phil Plourd, president of Ever.Ag Insights, offers a different perspective. According to his back-of-the-envelope math, today’s interest costs on building a 6,000-cow dairy are running about 60¢ per hundredweight more than 2021 levels. Plourd says it could limit producer’s appetites for expansion.
In recent years, the footprint of the industry has also changed, most notably the migration of dairy herds from coastal areas inland. For example, growth is skyrocketing in South Dakota. In January 2024, USDA said the number of dairy cows in South Dakota totaled 208,000, up 70.5% since 2019. To put that into perspective, the state’s dairy herd has added 118,000 cows in the past 12 years.
On the farm front, lackluster mailbox prices so far in 2024 are forcing dairy producers to find a way to keep their legs beneath them. Still, many producers across the county have their eyes open to the future and are eagerly embracing opportunities to grow any way they can.
The largest U.S. dairy cooperative, Dairy Farmers of America (DFA), conducted a member-survey that found by 2030 they will have only 5,100 member farms. That’s a drastic drop from their current membership numbers, says Corey Gillins, chief milk marketing officer with DFA.
