Long road to recovery

Written by Marjie Knust and Christine Bush
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Milking about 1,400 cows, Hoekman says he grows more of his own feed today, farming about 2,000 acres of corn and oats — 500 more than five years ago.

“The downturn caused me to want to grow more of my own feed,” he says. “Feed got out of control. I have always used manure as fertilizer. Now I use more of it.”

Not all dairy producers were fortunate enough to survive the industry’s downturn. John Traweek from Stephenville, Texas, says family members, including his father and brother, were losing roughly $30,000 a month on their 1,500-cow dairy.

“We started selling down in 2010 and reduced the herd size,” he says. “We were cannibalizing everything to make it work.”

The Traweeks sold their last dairy cow in 2012 after operating for three years without help from a bank.

“We sold things to pay bills and keep the feed coming in,” he says. “It’s hard. After all of the time we spent milking cows, all you can think of is the four or five years of stress.”
Fortunately, the family had diversified before the downturn, investing in a country club. Today, John manages the club’s golf course, restaurant and bar. His father retired and his brother found a job outside of the dairy industry. The family still farms crops.

The industry — from producers and processors to legislators — rallied for change using the lessons learned in 2009, especially those of producers like the Traweeks, who saw family dairying legacies come to an end in just a few short years.

“The one good thing that came out of the 2009 downturn was it unified dairy farmers and forced change,” Wilson says. “We now have a new dairy policy that gives dairy families the opportunity to protect themselves against future economic disasters.”

The focus in dairy policy quickly shifted from milk prices to on-farm margins.

“We used to talk about dairy prices as the end all, be all,” says Jackie Klippenstein, DFA’s vice president of industry and legislative affairs. “2009 changed that. We learned that prices are not what we measure success by. It’s margin. While as a Cooperative, we are still working for the best price, there are other factors we have to also focus on for our members.”

While work on dairy policy reform began in 2009, reform didn’t become a reality until just this year. The hard-fought battle for a Farm Bill was filled with frustration and delays. But, DFA members played a critical role in achieving the new legislation.

“Our push for the Farm Bill reaffirmed what we already knew,” Klippenstein says. “Which is that farmer engagement is the single most important factor in passing legislation that benefits dairy producers.”

While the dairy business environment changed five years ago, so did the legislative environment, Klippenstein points out. Shrinking population in rural areas resulted in a greater disconnect between legislators’ constituents and agriculture, which meant fewer votes for agriculture-friendly legislation.

“We are now also dealing with entities not directly related to our industry engaging in lobbying against dairy policy,” Klippenstein says. “The political environment has changed drastically. We used to depend on members of the Agriculture Committees in the House and Senate. Now, we also need members of the Ways and Means Committee, the Appropriations Committees and others.”