Elsa Condon, vice president-agricultural banking with BMO Harris Bank in Watertown and member of the WBA Agricultural Bankers Section Board, recently attended the UW System's Wisconsin Idea Dairy Summit and shared her thoughts on the summit.
Ray Cross, President of the UW System, and Secretary Ben Brancel opened the summit. Secretary Brancel highlighted all the evolution that has occurred in the US and Wisconsin dairy communities in the last forty years. The declining trend of milk produced in Wisconsin was quite dramatic in the 1990’s until leaders across the state started making conscious efforts to restart innovation in both milk production and processing in the early-mid 2000’s. Now, Wisconsin owns its title as the dairy state and our state brand has perceived premium value nationally and abroad. Growth is not without its challenges, and the purpose of the day was to outline challenges, then, outline some resources already working on elements for solutions.
Mark Stephenson spoke on his observations from speaking to producers and service providers throughout the dairy community. Through the Center for Dairy Profitability, he works to lead research on economic points of interest. He led with comments on the complexities behind April’s “sound bite” headlines. Comments he made about farms on “debt treadmills” seemed to communicate a perception that lenders possess a magic wand of sorts. Bear in mind: in a room of 200 industry members, there were probably a dozen producers and perhaps only three lenders.
- A trend worth mentioning is that in the latest large dairy projects, the dairy makes their location decision in concert with a processor choosing a new location.
- Improved US milk production per cow is exceptional compared to most biological systems. Where will we go from here?
- While Canada’s price is above the rest of world, it is off over 20% from its highs. US-Canada dairy trade follows 1987 WTO agreements as it was not included in NAFTA
- The milk protein isolate issue called out in Grassland’s April letter saw half the impact felt by Grassland and half the impact felt by two New York plants. There were a couple other small impacts.
- The 58 Wisconsin producers who received the Grassland letter represent 1% of Wisconsin milk production volume. Adding to processing capacity squeezes, Michigan remains 6-7 million lbs per day short on processing capacity.
Industry panelists responded with their observations on consumer wants (John Umhoefer, WI Cheese Makers), WI opportunities to market our local and sustainable values (Sarah Lloyd, WI Farmers Union), and challenges to face head on (John Holevoet, DBA).
- There has not been a new green site dairy in WI since 2012
- How soon can we get to solving the manure equation in a financially and operationally positive way?
- Producers and their advisers can focus excessively on increasing revenue as often that seems easier than improving margin.
UW leaders followed with presentations on farm business management, upcoming updates to the Center for Dairy Profitability data, dairy science opportunities, and dairy foods studies opportunities.
- Both a beginning farm and a 4-day intensive course on farm succession are available
- A Farm $Success Farm Business Management Program is on the chalkboard right now
- Recreational land does not spur economic activity and tax base like active industry.
- How to shorten the timeframe from innovation in dairy foods or dairy science to selling product on a commercial scale?
Additional applied teaching/research UW leaders followed lunch with updates from their respective areas. Dairy community stakeholders PDPW, Farm Bureau, and WMMB responded in a panel discussion following.
- There is a great deal of expert resourcefulness and data about dairy!
- Farm Bureau knows its lobbying work on things like research funding and brand preservation is key.
- WMMB is working hard with checkoff dollars to provide the research to processors on what millennials want. While fluid milk buying is down, Europe’s consumption per capital of cultured dairy products outpaces US consumption today.
In conclusion, the goal of all these presentations was to have dairy community stakeholders and leaders on the same page with knowledge today. Tomorrow, the focus is to build small working groups to focus on prioritizing challenges and then working out strategies to meet them.