Bill Baker…The National Dairy Producers Organization is trying to unite all 45 thousand dairy producers here in the United States and joining us now on dairy line is a dairy producer and treasure of the National Dairy Producers Organizations Gary Genske. Gary it wasn’t that bad of a year for the dairy producers this year but the past couple of months starting to see profits slip away.
Gary…well here we go again Bill, we producers have ramped up production expecting the export market to buy everything and we did cash in on the short term boom but at the possible expense of our long term sustainability
Bill…so why is their a National Dairy Producers Organization?
Gary…the low dairy milk prices were the primary reason for our organization to get started four years ago which followed the 2009 crash. We created the National Dairy Producers Organization for the soul purpose of dairy profitability for sustainability. We actual lobbied against the income over feed margin protection plan, predicting the plan would be of no real benefit for the dairy farmers and this is proving to be the case. We lobbied for a meaningful dairy provision, which called for the reduced production during the times we are currently forecasting for 2015. one prominent politician in D.C. even called our proposal communistic. Well we lobbied for sustainable milk prices not for a plan to slightly reduce our losses with government help. Co-Ops and processors and their lobby groups in D.C. were far more entrenched with money and time invested in the Peterson Simpson bill that ultimately turned into this margin protection plan
Bill…So why wasn’t your message received?
Gary…Our biggest obstacle in our farm bill efforts wasn’t the message we delivered that no one should make more of a product then what can be profitably sold, our setback was that we were the new organization that only had a few hundred dairy members. We were told that we needed to be better represented from the producers sector. The message was fine, particular since our plan was at no government cost. Our goal remains producer profitability for sustainability, and after four years we have about six hundred (dus 2:20) paying members mainly from Pennsylvania, New York, and Virginia, but are represented really in all the large dairy states. We continue to seek membership and unite the dairy farmers really and all 45 thousand of them.
Bill…and what else is the National Dairy Producers Organization doing?
Gary…We are trying to promote a higher grade of milk to go back to the old federal standards which California never abandoned by the way, there by utilizing more milk solids which results in a better product and this is to attract more sales with this better product and we have (grade 2:55) marked 100 USA retail logos to be seen on retail packaging and are making this available for all dairy products at retail and to continue to educate producers on national calls that anybody can call in on. The biggest thing is we have two major ideas which we hope to eventually follow up on and will require a lot more memberships to support. By buying dairy products directly from the CME to help support the dairy price and the second item of course is request hearings at the USDA to make a couple of changes to update or improve classes of certain manufactured products. These two issues alone could mean dollars per hundred weight on the milk checks. Our directors continue to volunteer their time towards these goals. We need membership and more than that we need the next generation of dairy farmers to get involved. This is their future. Membership and national representation is the key to success for an organization like ours
Bill…Producer profitability is the number one goal but to do that we’ll need to keep an eye on milk production which jumped another three and a half percent this past month. What are your thoughts there?
Gary…Well, you know dairy farmers spend enormous amounts of time managing expenses and
production and cow health and taking care of environmental matters and of all the dairy farmers that I work with very very few spend any time at all in managing the biggest number on their profit
and law statement which is the income side and that’s what this organization does is manage the income side and we need producers to get involved in that. So in managing the income side the
age old concept of supply and demand will prevail. Either the number of producers that will
reduce production will survive or the excess production from those producers will eliminate producers either way supply and demand will prevail and we call it supply and profitable demand. You know just because a co-op opens up another powder plant doesn’t mean there’s demand for product it just means there’s another home for milk. So a lot of people get confused over that as well.
Bill…You had mentioned you have members in Pennsylvania, New York, and Virginia. You’re located in California kind of a different situation with you know you have your own pricing and you have a higher standard of milk that you produce as well but you have seen through the years, you have been in this business for a while you have seen what’s happened particularly during the recession, the disastrous effects that has had on California producers haven’t you
Gary…The last five years in this business has been extremely trying on everybody and the main result of these really mismanaged inventories of excess dairy products has discouraged a considerable amount of improvement on diary facilities, discouraged new construction of dairy farms around the country. It has set dairy farmers back financially and more than that it has set dairy farmers back in their plans or even desires to be more involved in the system we have to live under.
Bill…You mentioned weekly calls that NDPO does and you also mentioned that you don’t necessarily have to be a member to be apart of those calls.
Gary…Oh no anybody in the country I mean we use to have three calls a week to make them at times that would accommodate different time zones. Let me give you the phone number for that. Our Tuesday member calls is area code is 712-775-7035 and you have to enter in a pin number, it is prompted for you to do that, and that’s 330090# and it’s five pm in the west and eight pm in the east. We invite people to bring up issues, concerns, suggestions more than anything else. I mean we’re a board of dairy farmers and you have to be dairy farmer to be a member of the National Dairy Producers Organization but certainly anybody can call in and voice objections and or have opinions I might say that as a result of literally hundreds of hours of phone calls from folks across the country we developed a farm bill proposal that I was just describing earlier and as a result of that we came out with a supply management program for only class three and class four milk products and only when those inventories are in certain amounts of excess and we identify the fact that class one markets should not have supply controls and class two as well and that’s absolutely true. Nobody makes more class one or two products than what can be used or stored and it’s always three and four that get us in trouble and nobody manages or controls the amount of those inventories. Anybody else and any manufacturing situation producing any products nobody makes more product then what can be profitably sold including car makers for example they even offer steep discounts on year end models but you better believe that they predict what they can sell before they make it. We don’t do that, we should.
Bill…Moving forward with the National Dairy Producers Organization are you looking for any type of dairy producer out there, a particular size ten cows or ten thousand cows?
Gary…We want 45 thousand members there are 45 thousand dairy farms so it doesn’t matter what size you are we all have one common goal we should partner up together because what was revealed in our D.C. calls on politicians on the house and senate AG committees was that we needed a stronger organization there are local organizations we are not trying to compete with them we are trying to set up a national organization for just dairy farmers and that’s our goal is to put all dairy farmers under one umbrella and say look we know when we have class three futures in the 14 dollars per hundred weight rage that we call for producers to just cut back one or two percent of production for a short time and they would then realize immediately an increase in milk price without a government plan so yeah we need all of the dairy farmers working together.
Bill…The dairy producers listening to this there is more information at nationaldairyproducersorganization.com or also, Gary you have a phone number to call as well right?
Gary…Call for membership at area code (949) 375-4450
Bill…Alright thanks. That’s Gary Genske, dairy producer and treasure of the National Dairy Producers Organization
Bill Baker…Profitability for sustainability. I’m Bill Baker and this is dairy line on Dairy business radio. That’s what one former dairy producer says is needed to get our milk pricing in order. Robin Berg from Wisconsin also a member of the national dairy producers organization.
Robin…Dairy producers this is a business and if your not going to treat it like a business you’ve got a problem and were doing an end product pricing structure. Milk is a 24 hour a day job. If your producing it you’ve got a perishable product, you refrigerate it, the cow keeps producing you gotta move it from the farm to the processor you’ve got to move it through the processing system into storage and then on to the consumer it’s a never ending chain so its an economy so the more milk you produce the more their going to increase their economy and if your not going to pull back on your domestic production or increase domestic consumption to meet it with end product pricing what is the producer going to get for price. The producer is going to have to take a really serious look at 2015 because even though the so called dairy experts that have been saying that 2015 wont be as good as 2014 but it still will be OK well I’ve seen it today on the block market Bill.
Bill…Getting back to responsible milk production in America, Robin, what’s the answer to that issue especially when we want to increase milk consumption
Robin…We have to have both, we have to do a better job of telling the American people what is in the product that their consuming, where it came from, country of origin. If the nations government won’t do it then you do it as a commodity industry. You can go out and tell the consumer where the product has come from. They want to know, people what to buy locally; they want to buy from this country because they know the conditions they are produced under. And on the other side just because you can produce more milk, Bill, that doesn’t mean that two percent three percent more production is going to bring you two or three percent more profit. If the price is going to decline by 30 percent you’ve lost your profit, your working for somebody else.
Bill…you mentioned country of origin labeling. National Diary Productions Organization tried to do something about that, it sounds like with 100 percent USA trade mark, How’s that going? Maybe you could just explain to us what that is all about.
Robin…Well, just what it says. Everything that’s in that product you’re buying, The dairy product is all produced in this country. If your happening to be buying chocolate milk, well we don’t produce chocolate in this country but all the milk that went in to making that chocolate milk was made in this country so you know the origin that way if you’re concerned about caseins, caseinnets things like that that are being imported and you don’t want them because they’re being imported because they’re cheaper they are going to be even cheaper with the change in the dollar and you don’t want them, the product your buying isn’t carrying the label, then you know wait the competitor here’s product is carrying the label. The consumer gets to make the choice
The feeling is you educate the consumer let the consumer make the choice. Put all your cards on the table and tell them what’s in your product.
Bill…we were talking earlier about the prices toping out for dairy producers and were heading back down. It sounds like 2015 could be a pretty big year for the National Dairy Producers Organizations when we’re talking about some of these issues
Robin…At least bring the light and bring people connected together to move and see what needs to be done as an industry and work together. I mean the consumers there, I mean we keep losing food consumption, the consumers there. When people will drink, I’ll just call it vegetable based products called milk which aren’t milk and will pay greater prices for them, which has less nutrients or nutritional benefits then we have a job to do to the consumer to tell them the benefits and the economics of real milk that comes from a cow but support of National Dairy Producer and our 100 percent USA logo which will have revenue to help do those kinds of things. You’ve got to have money to move something forward. It just doesn’t happen by itself
Bill…Robin Berg is a retired Wisconsin dairy producer and member of the National Dairy Producer Organization