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Extension > Agriculture > Livestock > Dairy > Grazing systems > Knee deep in grass: A survey of twenty-nine grazing operations in Minnesota > Challenges and opportunities

Challenges and opportunities

Brian Loeffler, Helene Murray, Dennis G. Johnson, Earl I. Fuller
Reviewed 2008

Most participants were very optimistic when asked about their future as dairy farmers (22 out of 29). Most agreed that they would have to deal with new challenges facing the dairy industry in order to prosper in the future.

Past challenges

Adapting to new farming practices

Eighteen graziers reported that adapting to new farming practices has been challenging. These included converting to MIG and to producing milk, meat (pork, beef, chicken), and crops organically. Most felt the benefits from MIG far outweighed the challenges of converting to it. Some graziers were receiving premium prices for producing organic commodities. Labor shortages. Seventeen respondents indicated that labor shortage problems have been challenging. Many said such problems could be solved if they could hire relief milkers periodically (one day a week and a couple of weekends a year). This would free them from having to be at the farm every day and would enable them to spend more time with their families.

Cash flow

Nine farmers said cash flow problems have been challenging. Graziers who had partially or seasonally freshened herds expressed concern about cash flow most frequently. Most felt that they would have to adjust their spending habits during the period when cattle are not milking. Dairy markets. Seven respondents believed that dairy markets have been a problem for them. Problems cited include the structure of milk marketing orders, the increasing number of large dairy farms and the use of products such as BST. Some produced and marketed milk labeled as organic to secure premium prices.

BST

Graziers were asked what they thought about using BST and its effect on their marketing options. Sixteen disapproved of BST use, six approved of its use and seven were neither for or against BST use. Reasons cited for disapproval include concerns for human health, cattle health and possible milk price declines. One grazier said, "It is just plain bad for farmers." Another claimed, "Farmers will have to stop (using BST)." He, along with many others, believed it would ruin the dairy industry, beginning with small farmers.

Respondents who approved BST use generally regarded it as an effective management tool for some producers. Most graziers believed that BST will fail economically for the users, regardless of their opinion of BST. Sixteen thought BST will affect milk markets, ten thought there would be no effect and three graziers had no opinion.

Most graziers responding that BST will affect milk markets believe the impacts will be negative. Twelve believed that the increased milk production will lead to decreased milk prices and lower consumer confidence levels with farmers. However, 4 of the 16 think the impacts will be positive for them. They believe that the demand for milk labeled organic will increase, resulting in premium prices for their organic milk and milk products.

Seven farmers reported concerns about profitability levels. Most believed that milk prices have not been high enough to make a good return on their investments. Many thought that MIG would increase their profits by increasing their gross margins for milk products.

Other challenges cited were financing, soil fertility, calving intervals, ration balancing, manure management, pest management and grain marketing.

Anticipated challenges

Anticipated challenges include: profitability (6); farm transfer (5); manure management and pollution compliance (4); developing pasture management skills (4); labor shortages (3); marketing milk and meat organically (6); adding alternative enterprises (3 beef, 1 manure, 1 green house); increasing farm size (2 dairy herd, 2 acreage); and marketing of farm products directly to consumers (3).

Current problems

Graziers were asked about major short- and long-term problems.

Short-term problems
Number Responses
7 Improving pasture management skills
6 Transition to seasonal freshening
5 Expansion and remodeling of farm structures and facilities
4 Labor shortages
2 High somatic cell count
2 Herd expansion

Approximately half of all responses related to MIG. Much of the balance pertained to the dairy farm but not directly to grazing. Other problems cited include forming a business plan/family arrangement, improving people skills, owning the farm and milking facilities and cash flow.

Long-term problems
Number Responses
5 Increase or begin direct marketing of farm products
3 Improve dairy facilities
3 Manure management (regulations)
3 Transition to seasonal freshening
3 Labor shortages
3 Transition to organic farming
3 Improving pasture management
2 Herd expansion
2 Improving farms aesthetics

Other replies included increase farm profitability, increase leisure time, reduce debt load and obtain farm financing.

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