This article appears in the August 2017 issue of Potato Grower.
Like gravity is to the laws of physics, supply is to the law of price in fresh produce, and fresh potatoes are fresh produce. Supply imbalances are, however, not unique to potatoes, or fresh produce in general; they can impact most every production commodity.
The following excerpts from an article that appeared in the Milwaukee Journal Sentinel on April 24 describe the challenging environment in the dairy industry with an oversupply of milk. While reading this, one only has to insert the names of other produce items (words such as “potatoes” and “potato acreage”) in place of the words “milk” and “dairy cows” to realize this could in fact be very applicable to other commodities and produce industries. Could this same article be written about the potato industry? And can it be corrected?
MILWAUKEE — The dairy industry is facing a glut of milk threatening to force some farmers out of business…
“There’s just too much milk,” said George Crave, president of Crave Brothers Farmstead Cheese in Waterloo, Wis. Farm cooperatives have told their members to think twice about adding more cows to their operations in a business climate already awash in milk.
“We have to strategically plan for every drop of milk now,” said a spokesperson for Foremost Farms USA, a cooperative owned by about 1,300 dairy farmers. “As our members look at their futures, and their plans for growth, they have to be in lock-step communication with us.”
Some say the flood of milk has resulted from decades of a way of thinking that has encouraged stepping up agricultural production. “It’s been devastating for farms of all sizes,” said Mark Kastel, a dairy farmer based in Cornucopia, Wis.
Wisconsin dairy cows continue to produce more milk than ever before. In March, the total was 2.59 billion pounds of milk, up 1.5 percent from a year earlier, and the 35th consecutive month of year-to-year increases.
Nationwide, a record 17.5 billion pounds was produced in the 23 major dairy states, up about 2 percent from March 2016, according to the U.S. Department of Agriculture.
Instead of constantly increasing production, dairy farms would be better off making sure there’s a market for their products first, said Darin Von Ruden, president of the Wisconsin Farmers Union. “We seem to be doing just the opposite,” he said.
“In the short run, we have got to put the brakes on milk production. Processors are telling farmers, ‘We can work through this … but don’t compound the problem by expanding milk output,’” said Bruce Jones, an agricultural economist at University of Wisconsin-Madison.
“This is devastating to farmers, and it’s been really heartbreaking for us,” said Daniel Smith, who oversees the Wisconsin Farm Center at the state Department of Agriculture, Trade and Consumer Protection.