James Weber, a young farmer from Michigan is learning as he goes– but the coronavirus pandemic, disrupted international markets, shifting technology and turbulent political debates make life as a beginning dairy farmer challenging. Still, Weber sees more opportunities in the dairy industry than he sees threats. He shared his perspective in the National Milk Producers Federation podcast, Dairy Defined.
The threats Weber sees on the horizon include labor, lab-grown milk and the cost of doing business.
“In our area, I think some of the main threats, and this is probably nationwide, I think labor is a really big one. We saw this with the recent election. There were some ballot initiatives in different states that raised the minimum wage to $15 an hour. And this is a trend that’s not going to stop at $15 an hour or at the states that it’s limited to right now,” he told NMPF’s Theresa Sweeney-Murphy. “And I think that creates a challenge. We have to increase our efficiencies on our farm in order to compensate for that increase in labor expense. And doing so, it’s always a challenge, but it’s an overcome-able challenge, I think. I think that we will do it. It’s just a difficulty.”
[Listen to the full conversation here.]
Another challenge he’s watching closely is lab-grown milk. While Weber admits it hasn’t taken off yet, he’s watching to see where it will go.
“Is it going to just be a hot button topic for a few years? And then they’ll realize it’s too expensive to produce this way or people are scared to consume a lab-grown product, I don’t know,” he told Sweeney-Murphy. “I think it has a threat potential. If it just captures that 2% or 3% market share, we’ll probably be fine with that. But it’s just, I’m unsure of how it’s going to turn out, and I can see that being a threat.”
Lastly, Weber says the rate certain dairy farm expenses are increasing could pose a threat too.
“I always think, too, like large equipment, tractors, things of that nature… My dad always tells me how when he was growing up a hundred horsepower tractor was $30,000-$40,000. And understandably, there’s so much more technology in the equipment, and there’s a lot more that goes into it. But regardless, these pieces of equipment that we need to run our businesses, their cost is going up exponentially in comparison to milk, which still has the same pay price as it did 40 years ago,” he told Sweeney-Murphy. “So it’s, again, we have to find our efficiencies on the farm to compensate for that, and it’s another challenge.”
Still, the young producer says there is more opportunity available than the threats that are looming.
“I think that there’s a lot of potential for smaller farms to start marketing direct to consumer, and even large farms have done it successfully. I think there’s going to be some opportunity with the net initiatives to go to carbon neutrality. There’s going to be opportunities for carbon sequestration, and I hope that there’s some money made available to dairies and any farm that’s able to sequester carbon. And I think those farms will be rewarded for that,” he explained to Sweeney-Murphy. “So there’s an opportunity there.”
Additionally, he sees export growth as an opportunity.
“There’s lots of reports that talk about how there’ll be a 25% increase, and I know the number is different everywhere you look, but I’ve seen 25% where the demand for dairy worldwide will increase at that rate in the next 10 years because of the number of people who are going to be coming out of poverty and joining the middle class,” he said on the podcast.
Other opportunities are the desire for high quality proteins, improving consumer confidence and the opportunity for the dairy industry to be part of environmental solutions.
“Talking a little bit about the carbon sequestration and things of that nature and how we might receive some funding for that, I think cover cropping is a great one. Recently, I’ve had the opportunity to learn about some of the different biodiversity opportunities out there, and the cover cropping is one where it might link in with the carbon sequestration, alternative energy sources,” he said. “There’s all sorts of positives. And it’s, again, very dependent on where you’re at in the country and what kind of companies and grid system that you have available.”
Lastly, Weber says technology advancement is an opportunity for the dairy industry.
“I think robotics, moving forward, there’s going to be more and more automation,” he said. “It links in with the increase and expenses of labor. If we see that, it’s going to be more budget-friendly to look into automation. And the dairy cows like robots, that’s pretty well known. So I think it’s only going to continue to go, and I think that leads to opportunities and improving our quality of life as dairy farmers. We can become more reliant on technology versus having to put in more hours and longer days. And I think that’s, all around, an opportunity and a benefit to our industry.”
