Milk Dumping underway in Wisconsin, farmers told they will still be paid

Ag Report

(WFRV) – Local 5 is speaking with Wisconsin Farmers being asked to dump their milk.

Ryan Elbe of Golden E Dairy Farms in West Bend, says the farm’s co-op, Dairy Farmers of America, told them to dump milk. 

They will be reimbursed for the milk, based on their last week’s average components. 

Ryan believes his operation is among the first in the state asked to dump, because of their size and ability to safely store and dispose of the milk. 

The farm is milking 2,400 cows and producing about 220 thousand pounds of milk every day. 

According to Kristen Coady, Vice President, Corporate Communications, Dairy Farmers of
America:

“In this ever-changing situation, our number one priority remains the safety and well-being of
our farm families and employees.

We are diligently working to ensure our farm families’ milk continues to be picked up, our
plants continue to operate, and we continue to provide consumers and communities with
wholesome dairy products during this difficult time.

With the uncertainty of COVID-19 and evolving consumer buying habits, we are seeing demand
for dairy products change. While we initially saw increased demand at grocery stores as
consumers stocked up on many products, like dairy, in anticipation of potential quarantines and
shelter-in-place orders, the retail demand is starting to level off. For this reason, we anticipate
that milk will be more readily available at grocery stores in the coming weeks. Also, during this
time, we’ve seen reduced needs in the foodservice sector with school and restaurant closures,
which has resulted in an overall surplus of milk.

These sudden changes in demand, are resulting in uncertainty, and are forcing some dairy
manufacturers to cut or change production schedules or build inventories. Due to the excess
milk and plants already operating at capacity, there is more milk right now than space available
in processing plants. This, in combination with the perishable nature of our product, has
resulted in a need to dispose of raw milk on farms, in some circumstances.

We continue to work with our customers to explore additional options to retain as much value
from our farm families’ milk as possible and to exhaust all possible avenues to find a home for
their milk.”

Other processors are also reaching out to farmers. Here is the latest from Land O’ Lakes:

As we continue to navigate the COVID-19 situation, Land O’Lakes’ top priority remains ensuring the health and safety of our employees, member-owners and surrounding communities, while also protecting our and your businesses.

In recent days, we have begun to experience market disruption in each shed resulting from increased milk production during the early stages of spring flush, customers reducing capacity and spot disruptions at our processing facilities.

Nationwide, the strong Class I demand that we saw at the beginning of the pandemic has slowed significantly this week. Additionally, food service sales continue to decline as schools, restaurants and other outlets remain closed due to social distancing and the “Stay at Home/Shelter in Place” Orders enacted in states across the country. This is resulting in more milk being diverted to our own processing facilities.

Considering these factors, it is essential we proactively plan for potential scenarios where our ability to pick up, process or otherwise market members’ milk is reduced. While we have not had to enact COVID-19 related assessments to date, we are quickly approaching the top end of capacities in our normal milk outlets and believe we may need to begin seeking alternative outlets for excess milk. This would be considered a disruption in market access, which would trigger the flat $10 per hundredweight assessment for all over Base production within the region.

All members currently producing over their Base allocation are advised to take necessary measures to avoid incurring an assessment. Please reach out to your field staff representative or visit the Production page on Milk Producers Online (MPOL) to access real time tracking of your actual production in relation to your Base allocation.

We will continue to monitor the status and business impacts of coronavirus and will provide regular communications via email and recorded phone messages to keep members informed on our operational status and potential assessments. If you have any immediate questions, please contact your local field staff representative or email membership@landolakes.com.

Glenda Gehl
Senior Director, Member Relations

You can read much more about the topic with a visit to https://hoards.com/

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