By MICHELE F. MIHALJEVICH
Indiana Correspondent

FORT WAYNE, Ind. — The question of how the dairy industry can help turn itself around was not one several exhibitors at last week’s Tri-State Dairy Nutrition Conference were eager to answer.
They didn’t mind answering the question, but they were a little concerned at how their responses would be taken by some of the conference’s attendees.

“I’m not sure I should say this very loud, but we just have to lose some cows,” said Phil Cerny, regional sales manager for SoyPLUS and SoyChlor. “We have lost some cows, but not a significant number.”

Farmers and others in the industry might not want to hear that, but they are concerned with the future, said Tim Brown, director of technical support for both brands.

“They may not like that idea, but having a long-term ability to make a living in the dairy industry is what most dairy farmers would be interested in,” he said. “That sustainability and long-term viability are what concerns them.”

The recession has cut into income families used to spend eating out, which means consumption of foods such as pizza and others that use a lot of dairy products have decreased, Brown said.
Combine that decrease with a decrease in dairy exports, and increases in input costs, and dairy farmers are getting squeezed, he explained.

“It’s a very sad story right now for the dairy farmer. Milk prices have been exceptionally low for a long time. Dairy farmers are hunkering down. It only takes a 1 or 2 percent change (in consumption) to have a huge impact on the price a farmer gets.”

SoyPLUS is a bypass protein, and SoyChlor is designed to reduce metabolic disorders, Cerny said. Both are products of West Central co-op, based in Ralston, Iowa.

Even though some producers might not want to hear about reducing the number of cows, it might be the best thing for the industry in the long run, said Ron Pahlow, sales and marketing representative for Rock River Laboratory, Inc., of Watertown, Wis. The company provides testing and analysis of feed, forage, soils and water.
“It might sound cruel, but the weeding out will probably get the producers out who aren’t selling,” Pahlow said. “The survivors will end up being more profitable.”

Pahlow, who said he has watched the industry for years, noted he’s seen a change recently in the types of testing Rock River is asked to do.

“Two to three years ago, there was growth from the $10 sample to the $19 sample, but now that’s leveled back down. People are just doing basic sampling.”

The hard times will make the industry better, said Zachery Meyer, also with Rock River.

“It is a pretty dire time for the dairy industry. We deal primarily with nutrition, but our customers have shown a resiliency to adapt, and that will make them stronger for the future.”

The oversupply of dairy products is caused by people simply not consuming enough, said Malcolm Ballard, president of The Ballard Group. His company distributes two products, Calmin and ETX-5, for Feedworks USA, Ltd.

“Last year, milk prices were really awful,” he said. “Milk is such a tremendous product. I don’t know if there will be enough of a decrease in dairy cows and an increase in consumption to make a difference soon.

“The situation is not going to be ideal in the next 12 months, but I think in a couple of years, the industry will be in a very good position.”

Ballard said his company had nice growth last year despite the industry concerns.

“Because Calmin was so effective, when producers were pulling out some ingredients just to survive, they weren’t touching the ones that worked. If they did that, all the dominoes would fall.”

Calmin modifies the rumen to prevent acidosis, he explained. Research has shown that ETX-5, where there are certain mycotoxins, has been effective in removing them, he added.