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Visualizing dairy geography

Kota Minegishi

Canada’s recent milk price change revealed how closely dairy processors operate to their maximum capacity in the Upper Midwest. The change led one of the major processors to stop accepting milk from dairy farms in Wisconsin and Minnesota1. With idle processing capacity present in the market, other processors would have been happy to take extra milk from those farms. Thus, there is a market level vulnerability in the dairy supply chain, and better risk management may be needed. Large processing plants can actively seek options to hedge market price risks through futures markets and long-term contracts, and dairy farmers may consider forward contracts to secure their marketing channels well in advance.

Understanding dairy industry dynamics is important for strategic decision making. In this article, I share some geographical data to help visualize regional trends in the dairy sector. Specifically, let’s look at where milk inventory and dairy-sector jobs are growing or decreasing using data from the USDA (the Agricultural Census2) and the Bureau of Labor Statistics (BLS; the Quarterly Census of Employment and Wages (QCEW3)) for each county.

Figure 1 shows the change in milk cow inventory from 2007 to 2012. While slightly outdated, the Agricultural Census provides the most comprehensive and accurate accounts of milk cow inventory that were directly collected from dairy farmers. During 2007-2012, the counties that saw an increase of 3,000 cows or more include Clark, WI; Juneau, WI; Jackson, WI; Fond du Lac, WI; Kewaunee, WI; Manitowoc, WI; Brown, WI; Meeker, MN; Morrison, MN; Sibley, MN; Stevens, MN; and Brookings, SD. Counties that experienced a decrease of 3,000 head or more include Otter Tail, MN; Waupaca, WI; Dodge, WI; Chippewa, WI; Green, WI; Clayton, IA; Delaware, IA; Osceola, IA; Minnehaha, SD; and Moody, SD. The overall change at the state level was -14.9% in Iowa, -3.9% in Minnesota, -6.4% in North Dakota, -33.4% in South Dakota, and +1.9% in Wisconsin.

map the midwest showing the change in milk cow inventory between 2007 and 2012

US Agricultural Census

Figure 1. Change in milk cow inventory by county, 2007 to 2012

For more recent data, Figure 2 maps the change in dairy farming employment between 2012 and 2015. The change in number of employees is also a good measure for understanding geographic dynamics in dairy activities. Counties that saw significant dairy farming job growth are Oconto, WI; Shawano, WI; Clark, WI; Sauk, WI; Dunn, WI; and Winona, MN, whereas Brown, WI had a significant job loss. It should be noted that these data do not include many small to medium dairy farms, given that the QCEW is calculated from the state-level unemployment insurance (UI) administrative records. In addition, some data at the county level cannot be disclosed due to the BLS’s confidentiality criteria and are hence missing. Nonetheless, it appears to capture the dynamics of the major dairy producers in a given area.

map of the United States showing the change in employees within dairy cattle and milk production fields between 2012 and 2015

Bureau of Labor Statistics, NAICS 112120

Figure 2. Change in employment in dairy cattle and milk production, 2012 to 2015

In Figure 3, I repeated the same exercise as for Figure 2 but for the employment in dairy food manufacturing at the state level. States with significant job growth in dairy food manufacturing are New York, Wisconsin, Indiana, Illinois, Georgia, and Idaho. Oregon, Ohio, Missouri, and Maryland lost jobs in this industry.

Map of the midwest showing the change in employement in dairy product manufacturing between 2012 and 2015

Bureau of Labor Statistics, NAICS 3115

Figure 3. Change in employment in dairy product manufacturing, 2012 to 2015

The above information is all publically available and offers insight into the geography of the dairy industry. I have posted interactive maps where you can see the numbers for individual counties used in the maps shown in this article. The interactive maps show the data for all counties in the contiguous United States, so be sure to zoom in and click on a county of your interest. The website also contains geographic data on corn and soybean production and land rental rates, as well as the relative prevalence of Hispanic population, a key prospective labor pool for expanding dairy operations. If you know of any other interesting geographic dairy data to visualize on a map, please contact me or any of my colleagues in Dairy Extension at the University of Minnesota.

References

  1. The U.S. - Canada Dairy Dispute
  2. United States Agriculture Data
  3. Quarterly Census of Employment and Wages

May 2017

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