Center Focus Column

Resiliency at Its Best

In his best-selling book, “Good to Great: Why Some Companies Make the Leap and Others Don’t”, Jim Collins said, “What separates people is not the presence or absence of difficulty, but how they deal with the inevitable difficulties of life.”

It isn’t news to anyone that dairy farm families are dealing with some of the lowest milk prices we’ve seen in the past decade. A global oversupply coupled with changing consumer and customer habits has put significant pressure on all US dairy regions, but particularly on the Northeast. Narrow or negative margins, milk market losses, and steep market costs are all repercussions of today’s milk market. But there have been some positive byproducts that have arisen as well.

One of the most remarkable qualities of the farm community is our ability to be resilient. Resiliency is when people move past their fears and focus on solutions to rebound stronger than they were before a crisis. To me, that is the story emerging right now that everyone is missing.

Quietly, groups are coming together, both within and outside of our industry, to say, “What can we do?” and “How can we help?” They are focused on identifying opportunities and finding solutions. Not everyone agrees on what those solutions are, but one thing that is consistent is their desire to help and to make a difference.

In my role at the Center, I am fortunate to have a front-row seat to some of the discussions that are occurring, and I have no doubt dairy will emerge stronger because of them. Dairy farmers, agribusiness leaders, elected leaders, and even our customers are engaged in the conversation. It is amazing to me to see the level of concern, community, creativity and collaboration being invested into the issue at hand.

It Starts with Concern

You would have to be living under a rock not to know about the current dairy situation. I have had reporters from all areas of the state, both rural and urban, calling to ask what can be done. They are even looking to do entire series to promote the Pennsylvania dairy industry. Consumers are also asking, and they are hearing the message to “Buy Local Milk and Dairy Products.”

Recently, while attending a parent teacher conference, I was stopped by the school secretary who wanted to make sure the milk she was buying was from Pennsylvania farms. The topic drew in the other office staff. That is the first time in the twelve years I have been visiting that school that I had that many people there engaged in a conversation about milk and dairy products. It was fantastic.

Legislators are also asking how they can help. Things like adding fuller fat milk back into the school lunch program and enforcing “Milk is Milk” labeling are now getting more traction than they did even a year ago. Traditionally only the Farm Bill could make changes to safety net policies. But an omnibus bill approved last fall made meaningful improvements to the Dairy Margin Protection Program, once considered inadequate and inapt by farmers. The Pennsylvania Milk Marketing Board is also being discussed at the state level, with policy leaders asking how that entity could better support Pennsylvania dairy farm families.

It Takes a Community

It is true that we don’t realize how important something is until it is threatened. A recent Pennsylvania Dairy Study shows that, in addition to providing a local source of dairy products, dairy provides the foundation for many of our rural communities, generating $14.2 billion in annual economic revenue and supporting over 52,000 jobs for the Commonwealth. Everyone in the agriculture industry recognizes how important a strong dairy industry and stable dairy farms are, and many groups are engaged in doing what they can to help.

Ag equipment companies are hosting meals to get farmers together informally as a network for each other, veterinarians are initiating discussion groups with their clients to share best management strategies, and trade organizations are all coming together to work on projects collaboratively to benefit the farm and the industry. Dairy processing companies and cooperatives – both staff members and board members — are digging deep to think through how to offer the farms without a market new homes for their milk, even when most of their markets are already flooded.

On the public side, this sense of community is also playing out. The Pennsylvania Department of Agriculture has taken the lead on engaging all other departments within the Commonwealth, both on helping individual dairy farmers and attracting reinvestment in processing to the region. One example is the push to attract new dairy processors to the state. The effort not only involves state agencies, but local economic corporations and planning groups as well. Those efforts are starting to pay off, with inquiries and interest in the region growing.

Creativity Is How It Happens

With the energy and interest in dairy right now, it is important to note that Pennsylvania is at a turning point. We cannot continue to operate business as usual. Consumers are not drinking as much fluid milk as they once were, and much of our infrastructure is in the fluid milk category. Reinvestment is needed to allow innovation in existing plants and product diversity in our portfolio. That takes creativity and new ways of thinking in our industry and within our governmental systems.

At the farm level, price volatility will not stop because we are operating on a global market. Dairy farmers here in Pennsylvania, just like in every other region of the world, will need to figure out how to drive down production costs to compete in this global market. Pennsylvania has some attributes that make us different, and we need to figure out how to capitalize on them and use them to our advantage.

Some farms are already doing that. Several groups of farmers are coming together to look at the feasibility of building their own processing plant and marketing their product locally. Other farmers with on-farm processing are looking at ways to take milk from other producers. The artisan cheese side of the industry is also growing, with more than 60 local, farm-based artisan cheese companies across the commonwealth. And, on the production side, farmers are coming together to share equipment, create buying groups, and even share employees to save costs. Diversity is also growing among our dairy farms, with farms doing agri-tainment or adding other ag enterprises to their business.

With everything happening in the industry right now, it is easy to get caught up in the negative. But that is a choice we all have. We need to focus on the opportunities that exist and use our creativity to emerge stronger than we were before. That will take strong minds and clear thinking. The ground is already being laid. Personally, I am looking forward to seeing what we can do.

Editor’s Note: This column is written by Jayne Sebright, executive director for the Center for Dairy Excellence, and published monthly in the Lancaster Farming Dairy Reporter.