With the current lackluster dairy economy, many producers are having a difficult time thinking about what growth in their operation will look like. Whether that’s adding a new barn, adding cows, putting in a digester or creating a space to raise out beef-on-dairy calves.
Interest rates are higher than we have grown comfortable with, and overall inflation makes building projects more expensive. Factor in low milk prices and it is difficult to pencil out how a new expansion project can generate a return on investment, especially in the near term. During these tough economic times, there is certainly a lot to take into consideration.
I’m always amazed when I talk to the producers who are able to see past the headwinds facing our industry. I wonder what they are seeing that others are not. For some dairies, including our farm, we push forward because we have pushed a project off for as long as possible. For example, on our farm, we are having cows calve in a thirty-year-old facility that we have simply outgrown. This maternity and dry cow barn should have been completed two years ago but was pushed off because other projects became a bigger priority. I always say that time and money are the two limiting factors. At least for us, it has been.
Not Yet
Actor Will Rogers probably said it best when he said, ‘The farmer has to be an optimist, or he wouldn’t still be a farmer.’
This statement rings true, as we all know the cyclical rollercoaster dairy is on. Currently, it is in a downturn, which makes it especially hard to look into the future of our operations and plan for growth. We have to remind ourselves that future plans don’t have to be yes or no, sometimes the answer is simply not yet. This means keeping your eyes open to the future, as well as other options, especially as there are several ways to dial in on alternative profit sources to help paint a prettier balance sheet. I don’t have to remind you all what kind of dollars day-old beef-on-dairy calves are generating. Heck, we are getting $150-plus for our day-old Jersey calves. If you told us that a year ago, we wouldn’t have believed it.
The path forward is not straight and easy. For many the path forward is constantly changing, but you must have a strong mindset that believes future possibilities are endless. The good thing is dairy farmers are the definition of grit and when challenges present themselves, a farmer doesn’t run from difficult situations. In fact, they roll up their sleeves and plow forward with determination. Continue to have that mindset as you tackle future opportunities to grow your business.
Remember, if farming was easy, everyone would do it. The good Lord called you to be a farmer and the world is depending on a strong U.S. agricultural economy to feed a growing population. Let’s continue to push forward with growth.
