Keep Consumers in Mind

June 1, 2010 01:11 PM

*Extended comments are highlighted in blue.


Brad and Mark Crandall
Battle Creek, Mich.

We'll start with the hope and prayer that the premise of this month's column ("Consumers Re-awaken") is correct.

The jury may still be out on whether the economy is technically recovering from the housing crash and media-condemnation/get-Obama-elected recession. Some areas of the economy have stayed strong, and hopefully the debt burden of stimulus, health care and the possible cap-and-tax bill will not send all of us back to the Stone Age. If the economy is recovering, it is only as a result of a strong, private, small-business sector that includes most all of us in the dairy business.

The on-farm approach to evolving consumer demand is a hard nut to crack. To meet the demands of the organic market, for instance, a farm has to totally commit to meeting its requirements. It also needs to have a reliable consumer base that is willing to pay the added price for essentially the same product that the rest of the industry is offering. The other options are processing your own or simply delivering your product to the market at market price through your co-op. Unfortunately, aside from being forced by processors to produce rBST-free milk, there aren't many on-farm practices one can make that directly affect consumer demand for your product.

Our approach is to supply the highest-quality milk possible with the best care possible for our animals. The result is essentially the best price we can attain--but not the personal connection to the consumer we would like to have. The burden falls upon all of us as an industry to market a product that people respect for its quality and health benefits.

As individual dairymen and dairywomen, the most valuable impact we can have is to reach out to the public by being involved with local schools and being open to showing our farm to people in the community. Each positive connection we make helps protect our livelihood when negative news stories, special-interest ads and fraudulent data are presented to the public.

Lastly, the best approach we may have to meeting consumer demand is to actually meet it and not blow it out of the water. Even in the best times, there is room for only "x” amount of production and no market tolerance for excess. Oversupplying the market doesn't meet evolving consumer demand and it doesn't meet our bottom-line goals, either.

Crandalls' April Prices  
Milk (3.5% bf, 2.9% prt): $13.88cwt.
Cull cows: $55/cwt.
Springing heifers: $1,500/head
Cottonseed: $248/ton (spot)
Soybean hull pellets $98/ton
Soybean meal:  $295/ton (spot)


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