For dairy producers in California, high costs and low incomes have been the recipe for some California dairies to call it quits. As a follow-up to a previous Dairy Today story, AgDay seeks to answer a question that's surfaced recently -- should California dairy's survival matter to you?
The Golden State is the top dairy producing state in the country. Leading the way in milk, butter, ice cream and nonfat dry milk, Dairy Today Western Editor Catherine Merlo says the state's survival matters.
"It accounts for about 20% of the nation's milk production," says Merlo. "So, what happens in California really has a big impact on the rest of the country."
It hasn’t been easy for dairy producers in the state to stay profitable the last five years.
"We lost 120 dairies in California in 2012, another 55 to 60 this year," Merlo says.
"It's certainly had its issues the last several years with high feed prices, increased environmental regulations, cost of labor," says Jim Mulhern with the National Milk Producers Federation (NMPF). So, there have been a number of factors that make it difficult for farmers to make a go of it in California."
Add to that increased environmental regulations.
"We're regulated by multiple different agencies, and at times, some of those regulations can conflict each other," says California dairy farmer Ray Prock.
Dairy farmers, like Prock, have been forced to find new ways to not only survive, but secure his future as a California dairy farmer.
"We've gone six hours north into Oregon and purchased our own hay ranch," says Prock.
Many experts say while California dairy farmers have struggled, its exports will carry the state forward, specifically the growing demand for safe dry baby milk powder in Asia, makes the state's producers in high demand.
"California is positioned perfectly for that Asia market," says Mulhern. "I think over the next 15 to 20 what you’re going to see is more of that milk production in California moving into ingredients and products into world markets."
"Not only is California geographically positioned to market to Pacific Rim, but also, when California helps develop markets that develop markets for producers in other states," says Merlo.
That export advantage is one major reason why Mulhern says you can't count California out.
"I think the future for the California dairy industry is very bright," he says.