MILC Info
Dairy farmers who want to learn more about the Milk Income Loss Contract (MILC) or to sign up for the program can contact the Green County Farm Service Agency at (608) 325-4195, ext. 2.
MONROE - The sluggish national economy now is hitting dairy farmers, who have seen the price of milk decline.
Six months ago, Monroe dairy farmer Rob Treuthardt received about $20 per hundred pounds for milk he sold. The price has fallen recently to about $15.50.
"I guess it's because of the economy," he said.
Treuthardt is typical of Green County dairy farmers. He's a second-generation farmer who milks about 100 cows. According to Green County ag agent Mark Mayer, the average dairy farmer in Green County milks about 90 cows.
Treuthardt said the falling milk price makes it difficult for him and other farmers to make ends meet.
"What you did six months ago won't work now," he said. "You have to find ways to make money or you'll start going backward."
Mayer said the price of Class III milk, used for butter and cheese production, is expected to continue its decline for the next few months.
Milk futures prices for each hundred pounds of milk are expected to be between $10 and $11 through March and between $11 and $12 in April and May.
Farmers are paid about $2 more per hundred pounds than what the market pays, Mayer said. Farmers receive premiums for their milk depending on the butter fat and protein levels. When the market price is $10.80 per hundred pounds, farmers generally will receive about $12.80.
That's still a lot less than what farmers received just a few months ago, Mayer said.
"This level of milk prices will cause major financial stress in the dairy industry," professor emeritus Bob Cropp from the University of Wisconsin Cooperative Extension wrote in December.
Cropp said restaurant traffic is important for cheese and butter sales, but fewer people have been going to restaurants due to the weaker economy. He said the outlook for restaurants in 2009 is expected to remain dim.
That will make it difficult for the more than 370 dairy farms in Green County, Mayer said.
"About 22 percent of jobs in Green County are ag related," Mayer said. "It's estimated that each dairy cow generates about $17,000 of economic activity."
For the first time in a couple of years, Mayer said, farmers will be able to take part in the Milk Income Loss Contract (MILC), a federal program that pays farmers when the price of milk goes below a target price established for Class I milk in Boston. Class I milk is the fluid milk purchased in stores. The program was part of the 2008 farm bill and has been around for a few years, Mayer said.
The established price in January for Class I milk is about $17.85 per hundred pounds of milk. The amount established for Class I milk can increase or decrease every month.
Local dairy farmers who make less than the $17.85 per hundred pounds price established in January will be able to sign up for the program to help make up for their losses. The program only pays 45 percent of the lost amount, Mayer said. Mayer said a farmer who sells his milk for $15.85 will receive an extra 90 cents for every hundred pounds of milk, which will bring the amount they receive to $16.75.
Treuthardt said he's happy with the extra money, but it's still difficult for a dairy farmer to make ends meet.
"It's like putting a Band-Aid on an open wound," Treuthardt said.
Six months ago, Monroe dairy farmer Rob Treuthardt received about $20 per hundred pounds for milk he sold. The price has fallen recently to about $15.50.
"I guess it's because of the economy," he said.
Treuthardt is typical of Green County dairy farmers. He's a second-generation farmer who milks about 100 cows. According to Green County ag agent Mark Mayer, the average dairy farmer in Green County milks about 90 cows.
Treuthardt said the falling milk price makes it difficult for him and other farmers to make ends meet.
"What you did six months ago won't work now," he said. "You have to find ways to make money or you'll start going backward."
Mayer said the price of Class III milk, used for butter and cheese production, is expected to continue its decline for the next few months.
Milk futures prices for each hundred pounds of milk are expected to be between $10 and $11 through March and between $11 and $12 in April and May.
Farmers are paid about $2 more per hundred pounds than what the market pays, Mayer said. Farmers receive premiums for their milk depending on the butter fat and protein levels. When the market price is $10.80 per hundred pounds, farmers generally will receive about $12.80.
That's still a lot less than what farmers received just a few months ago, Mayer said.
"This level of milk prices will cause major financial stress in the dairy industry," professor emeritus Bob Cropp from the University of Wisconsin Cooperative Extension wrote in December.
Cropp said restaurant traffic is important for cheese and butter sales, but fewer people have been going to restaurants due to the weaker economy. He said the outlook for restaurants in 2009 is expected to remain dim.
That will make it difficult for the more than 370 dairy farms in Green County, Mayer said.
"About 22 percent of jobs in Green County are ag related," Mayer said. "It's estimated that each dairy cow generates about $17,000 of economic activity."
For the first time in a couple of years, Mayer said, farmers will be able to take part in the Milk Income Loss Contract (MILC), a federal program that pays farmers when the price of milk goes below a target price established for Class I milk in Boston. Class I milk is the fluid milk purchased in stores. The program was part of the 2008 farm bill and has been around for a few years, Mayer said.
The established price in January for Class I milk is about $17.85 per hundred pounds of milk. The amount established for Class I milk can increase or decrease every month.
Local dairy farmers who make less than the $17.85 per hundred pounds price established in January will be able to sign up for the program to help make up for their losses. The program only pays 45 percent of the lost amount, Mayer said. Mayer said a farmer who sells his milk for $15.85 will receive an extra 90 cents for every hundred pounds of milk, which will bring the amount they receive to $16.75.
Treuthardt said he's happy with the extra money, but it's still difficult for a dairy farmer to make ends meet.
"It's like putting a Band-Aid on an open wound," Treuthardt said.