The certified organic dairy farms in the U.S. are feeling the effect of rapid growth in the industry. As demonstrated by the recent termination of 89 organic dairy farms in Maine, Vermont, New Hampshire and New York by Danone North America, which owns the Horizon Organic label, small producers are being dismissed as it becomes more cost-effective for processors to source milk from a few large operators rather than transport milk from numerous, scattered small farms located away from major processing facilities.
Unfortunately, the industry’s growing pains don’t only have to do with the “economies of scale” that – at least for some – have become the bottom line. Organic Valley has stepped up and offered contracts to most of the New England farmers left in the dust. But Danone’s decision to stop sourcing milk from Northeast dairies has thrown into better focus the struggle of small dairy farmers – organic or not – as well as the struggle the USDA’s certified organic designation is facing.
According to Ed Maltby, the executive director of the Northeast Organic Dairy Farmers Alliance (NODPA), different interpretations of the "pasture rule" and the "origin of livestock" (OOL) allowed the rapid expansion of organic dairy concentrated animal feeding operations (CAFOs). These vertically integrated operations produce store-brand milk, which can be trucked across the country. Ultrapasteurization allows this milk to remain shelf-stable for long periods, making it a viable alternative to regionally sourced dairy. In regions such as the Northeast, where the cost of operations for dairy farms is high, organic producers can’t compete with these disadvantages.
Amended regulations aimed at stopping questionable practices clarify “that organic milk and milk products must be from animals that have been under continuous organic management from the last third of gestation onward, with an exception for newly certified organic livestock operations.” (Read the full USDA policy here.) These amendments may stop some unsavory practices that allowed large-scale organic dairy farms to move animals into organic production without first incurring the costs of managing those animals organically. However, it is unlikely to rectify the consequences of “get big or get out,” which led some devastated conventional family dairy farms to try organic farming in the first place, and is now – predictably – breaking down the barn door on small and midsized certified organic dairy farms.
Yet, other factors are converging on organic dairy farmers. Poor growing conditions that impact pasture forages and harvested feed crops, the scarcity and expense of certified organic feedstuffs, a pay price that has been relatively stagnant over the past few years and the escalating costs of fuel, labor and other inputs required on the farm have led small and midsized organic dairy farmers to heavier culling and reduced milk production. According to Maltby, some have resorted to auctioning their farm or herds, while others are returning to conventional production. Even as the retail demand for organic dairy products continues to grow, many organic dairy farms are operating under production quotas, leaving certified organic milk in the bulk tank and money on the table.
Dairy farmer coping strategies
At the NODPA Field Days in September, one workshop focused on feeding strategies organic producers could utilize when grain and input costs are high. Bill Kipp, a nutritionist and dairy consultant at Independent Dairy Consultants Inc., along with Heather Darby, an agronomic and soils specialist, and Sara Ziegler, a crops and soils coordinator – both from the University of Vermont – provided suggestions for feeding, as summarized below.
Costs of certified organic cornmeal, soybean meal and complete dairy feed have increased roughly 20%-40% over 2021, while the pay price for organic milk has increased less than 1% for Northeast farmers, at $31 per hundredweight (cwt) in 2021, and a mere $33 per cwt in 2022. COVID-19 supply chain disruptions, combined with the war in Ukraine, have led to high prices and short supplies of certified organic grain. Relying on homegrown feeds and reducing the amount of grains fed can help economically.
Whether harvesting stored forages or growing pasture for grazing, maximizing yield and minimizing non-digestible fiber content is key. Harvesting at the proper time – whether via grazing animals or mechanical harvest – optimizes energy, which is the limiting factor on pasture-based operations.
Understanding the basics of plant growth as well as forage digestibility can help farmers produce pasture and feed crops that can provide the energy and digestibility needed to keep the milking herd productive and healthy with fewer – or no – grains fed. Soil pH and fertility impacts plant growth and yield, as well as the nutritional content. Seasonal changes in plant productivity, actual growing conditions and digestible fiber concentrations all work together to reduce the need and cost of purchased grains.
Fermented feeds can best be managed when bales are individually wrapped. This reduces loss from spoilage and can allow for measuring and nutrient content labeling. Mixing bales to create the desired ration and the needed protein and energy balance is an excellent way to optimize nutrients and match feeding with stage-of-life needs.
Grouping cows by lactation stage – while requiring more management – can reduce nutrient waste, targeting the cows who can utilize nutrients in high-quality feeds and avoiding nutrient loss. Grouping cows and feeding strategically to promote maximum production means more milk for less cost. The highest margin over feed costs happens in the first 100 days of lactation, and this peak production carries through to the remaining lactation period.
Dry cows shouldn’t all be treated equally either. Far and close-up cows don’t need to be fed on the same nutritional plane. Close-up cows benefit from added roasted soybean meal fed at 2 pounds a day, which provides the extra protein needed for the calf’s development, and require excellent quality forage. Earlier in the dry period, cows don’t need the soybean meal, and forage quality doesn’t need to be as high. Dry cow minerals are essential throughout the dry period.
Skimping on minerals is never a good bet, no matter the stage of life. Delaying breeding until 90 days in milk can result in higher milk production peaks, which are higher in open cows, but is only a recommended strategy if the herd conception rate is greater than 50%.
Increasing regional organic processing capabilities, greater domestic production of organic feedstocks and an organic dairy exemption from the existing Federal Milk Marketing Orders are potential solutions to present woes and future crises. While these proposals are helpful moving into the future, organic dairy farmers need to survive today. Cutting feed costs without sacrificing herd health or productivity can be implemented in the short term, and have long-term, positive effects on dairy farm economics.
