Across the nation, hundreds, if not thousands, of dairy farms are calling it quits. At the same time, some of the more fortunate operations are expanding. Dave Coggins is with the American Bankers Association’s Rural Bankers Committee said the long slump in milk prices is catching up with some farmers.
“If they’ve made some moves in terms of adding capital to their operation when they don’t have the income-producing units to cover that kind of capital, and maybe got over-leveraged after ’14 when prices were really high and assumed they would continue like that for awhile…you know, you get into the high-teens and as high as $20 cwt, you bleed red ink in this environment.”
However, on the other side of that coin;
“There are still expansions going on across the country that are adding cows where there is break-evens in the $15 and some cent range for Class III. That’s workable in today’s environment. They’ve got buffer for that kind of condition.”
Coggins said he empathizes with families that are pulling out of the dairy business altogether.
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