Capturing Opportunity in Dairy: In the Mountains of PA
Recently, our family ventured to the north hills of Pennsylvania to enjoy a cold winter weekend in a cozy hunting cabin. The cabin isn’t fancy but is nestled next to a beautiful stream and has a big wood burning stove in the middle of the first floor to keep things warm. Shortly after arriving on Friday evening, and getting the heat started, we went to check on the water supply. Frozen pipes told us the previous camp member hadn’t properly drained the system, which meant we’d be working to use our plumbing skills the next morning.
Saturday morning temperatures were hovering around zero when I decided I needed some additional supplies and so I headed up the road to a dairy farm located about 7-8 miles away. The farm owner has been a longtime friend of the family and I knew he’d be able to give us some help in locating the needed supplies.
I also knew the farm owner was well beyond retirement and a young farmer had been handling the day to day work. I entered the barn and walked to the top step of the parlor where the last of 150 cows were entering. A young man in his early 30’s came over and recognized me from a brief visit during fall archery season and we talked about a group of new cows recently purchased. The conversation which ensued made me realize Pennsylvania remains a region with its share of young dairy entrepreneurs who recognize the opportunity milking cows still provides.
This young dairy farmer, married with young children, began working for the land owner in his early teens and has continued working there since. After graduating from high school and two years in college, he returned to manage the daily responsibilities and, eventually and only recently, purchased the business and is leasing the land. He provides a glimpse into what the next generation of dairy farmers will look like in many areas around Pennsylvania.
It became obvious to me, he understands the “business of dairy”. He has invested in capital assets and has used consulting and other professional resources to arrange capital from traditional and private sources. He understands technology and, like all other farmers before him, knows what a 16 hour day looks like. He has positioned himself to take a run at growing equity for the future of his young family and to do it in the dairy business. During our conversation, it became clear to me he understood the importance of high production from “enough cows and enough pounds per cow” to spread fixed costs over more units of milk.
With the milking done, the two of us spent another 30 minutes discussing the dairy business and his quest to take advantage of the current opportunity being presented with record prices and record margins. We talked about what young dairy farmers are going to need to be successful. I saw again the importance of the current milk market environment and the opportunity to rebuild balance sheets, in some cases, still not completely restored from 2009.
As I turned to leave, he gave me his business card. The card included the standard information but stated boldly “Dairy Farmer,” which left no doubt the enthusiasm and confidence this young man has for his chosen profession. The back of the card included a familiar scripture text clearly showed where his source of confidence comes from. This unexpected visit with a young aspiring dairy farmer left me humbled and proud to be a part of an industry providing much needed protein supplies for mankind both here and around the world. At the Center for Dairy Excellence, we remain bullish on dairy. Contact us for more information on the on-farm resources we have available at 717-346-0849 or at email@example.com.