By TIM THORNBERRY
Kentucky Correspondent

LAWRENCEBURG, Ky. — There is perhaps no more demanding job in agriculture than that of a dairy farmer – 3 a.m. wake-up calls, 18-hour days, no vacation or sick time.

There may be no one more dedicated to their work than a dairy farmer, which makes the state of the business as it is right now all the more difficult to take as more dairy farms are disappearing from the agricultural landscape.

Scotty Buckley of Anderson County, Ky., is one of those trying to hang on for one more year, hoping the downturn in prices and upswing in input costs turns around enough to allow him to break even.

“Almost everyone in my family used to be in the dairy business. We are known for our dairy business,” he said. “Now, I’m the only one left.”

Buckley’s 300-acre farm has been in the family for more than 40 years. It was passed down to him by the generation before, but whether it will last long enough to hand down to his children, he doesn’t know.

“We take pride in this dairy, but we’re going broke,” he said.
The price farmers are getting per cwt. of milk has dropped drastically over the last few years, Buckley added. His last check was $11 per cwt. but with costs of over $16, it is easy to see why he and so many like him are “going broke.”

“The export market is down and of course the consumer has cut back because of the recession,” he said.

Buckley’s frustrations are not just based on the slow economy but on the nature of the business itself. “It’s my understanding that the farmers here are paying out of their milk checks a portion to ship milk in from large farms located in other states,” he said.
Those farms he referred to are the “big” operations, sometimes having up to 30,000 cows.

Buckley, like so many of his counterparts, belongs to a large dairy cooperative that serves 48 states and an estimated 18,000 farmers. From each check comes out payments for transportation, industry advertisement and other business related expenses which Buckley said is fine for his milk, but not for someone else’s.

And that is just the beginning of his frustrations. “We’re at their mercy,” he said of the dairy co-op.

That cooperative in question is the Dairy Farmers of America (DFA) – and Buckley isn’t the only one complaining. Last year a number of family farm and dairy and consumer groups requested the Senate Judiciary Committee begin hearings concerning DFA antitrust abuses and rampant corruption, according to the National Family Farm Coalition (NFFC).

By year’s end two former DFA executives were ordered to pay a multimillion-dollar penalty leveled by the Commodity Futures Trading Commission (CFTC) for attempting to manipulate the Class III milk futures contract and exceeding speculative position limits in that contract.

A press release from the DFA stated, “Without admitting or denying the CFTC’s findings in the administrative order, DFA and two of its former officers agreed to pay a negotiated aggregate civil monetary penalty of $12 million. The Cooperative also agreed to not engage in speculative trading in milk futures contracts for two years and to retain a monitor to review its trading activities on the CME during that period.”

DFA President and CEO Rick Smith said agreeing to the settlement was in the best interests of the cooperative and its members.
“Settling this matter will allow us to focus wholly on serving our members and moving the cooperative forward,” said Smith, who took the helm in 2006, years after the trading activity in question, according to the statement.

“The transactions addressed by the settlement took place over a one-month period more than four years ago, We have fully cooperated with the CFTC’s investigation and wanted to put this matter behind us.”

Just last month, however, the NFFC asked for a third time that Senate hearings begin into the practices of the DFA. Paul Rozwadowski, NFFC Dairy Subcommit-tee chairman, said, “With farm milk prices collapsing by over $5 in February, the situation for dairy farmers is the worst we have ever seen in our lifetimes.

“Farmers from California to Wisconsin, to Vermont, are being threatened with extinction not due to overproduction, but thanks to a corrupt pricing system that fails to consider farmers’ cost of production.

“DFA has a virtual monopoly on milk markets in many parts of the country.”

Like so many others, Buckley has scaled back his operation from 150 to 100 cows and has begun to supplement his farm income with feeder steers.

“We can keep the farm with the steer business, but we don’t have the same kind of pride in it,” he said. “We have raised many of our dairy cows. In the steer business you buy them, keep them for a while, put some weight on them then sell.”

It is the pride factor that keeps him in the business, even though it is becoming more difficult.

A year ago, milk prices were around $20 per cwt.

That is almost twice as much as Buckley’s last check. He has seen the price fluctuate as much as $4 in one month. That may not sound like much, until one figures in 200,000 pounds of milk.
With $1,500 a month in electric bills, $1,000 in water bills and feed that has doubled in price over the last 20 years, Buckley actually gets less for his milk now than he did in 1987.

There was a day when farmers grew other crops and used small dairies to supplement their farms and get a regular check.
Buckley was no different, although his dairy has been the main staple of the farm.

He raised tobacco until the federal buyout, then “put all his eggs in one basket” once tobacco was no longer profitable for the farm.
“That was a mistake,” he said. “You just can’t make it. There’s not much of the pride left and when it’s breaking you, it’s hard to swallow.”