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Milk prices in Maryland: Udder confusion

Associated Press//June 22, 2011

Milk prices in Maryland: Udder confusion

By Associated Press

//June 22, 2011

FREDERICK — With more than $51.5 million in annual milk sales, Frederick County is the undisputed leader in the state in dairy production.

Although the number of Frederick County dairy farms has leveled off over the past couple of years and holds steady at about 110, the U.S. Department of Agriculture census ranks the county No. 1 in the state, according to Colby Ferguson, the county’s agriculture development specialist.

Washington County ranked second at $45 million in annual sales, and Carroll County was third at $21 million. At the moment, dairy farmers are enjoying good prices for their milk, Ferguson said.

Milk is selling for $20.49 per hundredweight. But the industry is known for wildly fluctuating costs, and milk pricing has always been a thorny issue for dairy producers.

“Einstein’s theory of relativity is easier to explain than how milk is priced,” said Point of Rocks dairy farmer Chuck Fry.

“If you can find someone who can explain milk pricing, then you can find someone who can explain world peace,” said Susan Summers, a Monrovia resident who has spent most of her life working in the agriculture industry.

The price of milk is based on content, such as how much butter fat or protein it contains, Fry said.

The ideal way to price milk would require an independent agent that identifies content, but cooperatives price the milk and also decide what’s in it, Fry said.

According to the USDA, milk-price regulations under the Federal Milk Marketing Order are binding on dairy manufacturers and stipulate what prices are paid for milk, depending on how the milk is used for different dairy products. That means manufacturers base decisions on government price formulas instead of on the marketplace.

Farmers’ concerns for a fairer pricing formula recently prompted congressional discussion aimed at giving dairy farmers a better deal for their product.

“We’re in the process of trying to find a better pricing mechanism because the dairy farmer gets such a small percentage of the milk check,” Summers said.

Maryland Agriculture Secretary Earl “Buddy” Hance has also said the Federal Milk Marketing Order needs review.

“The current program is not meeting Maryland dairy farmers’ needs,” Hance said, responding to questions by email. “Reform should address an evolving world market and changes in American dairy dietary requirements. We are willing to work with Congress to see that Maryland’s dairy farmers get the needed reforms to secure their future.”

Dairy farmer Pam Hawker-Moser, who operates Walnut Ridge Farm in Middletown with her father, Douglas Hawker, said her family’s only income comes from the milk they produce, so a fair pricing scheme is important to them.

“We solely depend on our milk income to survive,” she said. “We have no outside jobs like some who have outside employment and the farm as a second occupation.”

Dairy farmers strive to produce a wholesome product for the consumer, Hawker-Moser said.

“We as dairy farmers do not have to do this work,” Hawker-Moser said. “It is what we know, love and thrive to do. We are dedicated to our job, animals and family. This is a 24/7 occupation. Costs are high and prices could be better, but we have learned to deal with what we are given and try to make the best of bad situations.”

Projections for 2011 show strong milk prices throughout the summer, but Ferguson said the demand would lessen with schools closed.

“These are volatile times for the dairy and livestock industry primarily due to high feed prices,” Ferguson said. “Ultimately, the consumer will start to see the effects of high grain prices at the grocery store as meat and dairy products will most surely rise in price over the next four to six months.”


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