Five years of low milk prices have taken a toll on Wisconsin dairy farmers. The Class III milk price plummeted from a record high of $25 per cwt in September 2014 to a low of $13.89 in January 2019.
During much of that time, the price averaged below $16 per cwt, which was less than breakeven for most Wisconsin dairy farmers. Thanks to strong fourth-quarter prices, Class III milk in 2019 averaged $16.96, which is $2.35 higher than the 2018 average price.
It shouldn’t come as a surprise to anyone that Wisconsin lost 818 dairy farms in 2019. This is on top of the 703 dairy farms that ceased operating in 2018. During the past two years, Wisconsin has lost 1,521 dairy farms. If you do the math, that means the Dairy State lost more than two dairy farms each day during the past two years, declining to 7,292 on Jan. 1, 2020, from 8,813 on Jan. 1, 2018. This works out to just under 18% of dairy farms, or nearly 1 in 5, going out of business in 2018 and 2019.
It’s all very sad. Not only was it likely gut-wrenching for most of the families on those 1,521 dairy farms to sell their cows, but it has also been a difficult time for all of rural Wisconsin. The loss of so many farms has been tough on agribusinesses and Main Street businesses in rural towns — like hardware stores, car dealerships and restaurants — that depend on farmers to be their customers.
While Wisconsin lost nearly 1 in 5 dairy farms in the past two years, cow numbers barely budged. According to the National Agricultural Statistics Service, Wisconsin went from 1.272 million dairy cows on Jan. 1, 2018, to 1.265 million dairy cows on Jan. 1, 2020, which is a loss of 7,000 cows. When farms were sold, many cows were bought by neighboring dairy farmers, meaning most cows simply changed their address. Meanwhile, Wisconsin produced a record amount of milk in 2018 — 30.6 billion pounds. On Feb. 1, NASS will know if Wisconsin set a record for milk production during 2019.
Wisconsin has been losing dairy farms since 1950, when NASS began keeping track of dairy farms, cows and milk produced across the U.S. In 1950, Wisconsin was home to 142,977 dairy farms and 2.16 million cows, which works out 15.1 cows per farm. Milk production in Wisconsin that year totaled 14.796 billion pounds.
By 1960, the number of dairy farms in the Dairy State had dropped to 97,042 — a loss of 45,945 farms in just 10 years. Cow numbers during this time only declined by 10,000 to 2.15 million, and milk production climbed to 17.78 billion pounds. Fifty years ago, there were 62,125 dairy farms with 1.845 million dairy cows, which produced 18.435 billion pounds of milk. By 1980, the number of dairy farms had declined to 44,090, with 1.753 million dairy cows producing 22.298 billion pounds of milk. A decade later in 1990, there were 31,282 dairy farms milking 1.75 million cows producing 24.4 billion pounds of milk.
Milk production continued to rise each year in Wisconsin despite fewer farms and cows until 2000. Twenty years ago, there were 20,715 dairy farms with 1.35 million cows producing 23.07 billion pounds of milk — a loss of 750 million pounds from 1990. Obviously, that trend soon reversed itself, and today, Wisconsin milk production has risen to 30.6 billion pounds of milk from 1.265 million dairy cows on 7,292 dairy farms as of Jan. 1, 2020.
Cow numbers seem to have stabilized over the past 10 to 15 years. But it looks like the trend of more cows on fewer dairy farms will continue as we look ahead to this new decade.
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