U.S. dairy farmers should listen to the following words of Buzz Shahan, COO United Potato Growers of America, Sept. 2020 issue of Potato Grower.
“Chaos happens for many reasons, the most common being that no entity takes charge of maintaining order. When an entity is in charge, it puts in place a certain behavioral structure that brings order to chaos.”
This brings to mind the co-op management hired by co-op dairy farmer member owners “who operate chaotically, without regard to the most vital element in (dairy farmer’s) economic structure: supply chain management.”
Existing co-op management “wander through the marketplace, smashing it with chaotic supply-chain disorder at every opportunity” by encouraging and accommodating an excess supply of co-op milk exceeding the profitable marketplace demand for member milk.
Dairy farmer co-op member owners assume the entire financial risk of producing this milk supply exceeding profitable marketplace demand. Dairy farmers need to hire co-op management who will properly manage this milk supply they feed into the marketplace. “With today’s information technology, supply chain metrics are easily dialed in.”
DAIRY FARMER: Stop the chaos. Have YOUR co-op management take charge of maintaining marketplace supply chain order and achieve a profitable milk price from the marketplace for most dairy farmer co-op member owners. When the milk marketplace is dialed in with a milk supply balanced with profitable demand, milk production can be profitable. Without profit, dairy farmers can make milk only until they run out of money.
Join and implement the co-op management policies of NDPO and cooperatively share in continuously balancing/matching YOUR co-op milk intake with PROFITABLE marketplace demand for co-op member milk and thereby obtain a profitable milk price from the marketplace and hold YOUR hired co-op management accountable to dairy farmer co-op members and dairy farmer profitability.
Bob Krucker, Idaho dairy farmer
Dairy farmer financially supported organizations DMI, NMPF and USDEC are spending dairy farmer money promoting a new environmental proposal entitled “Dairy’s Sustainability Imperatives” (DSI)
DSI’s second Imperative states “Sustainable environmental practices must be profitable for farmers.” Good idea!
How about also promoting practices that make making milk “profitable for farmers” by balancing the milk supply with profitable demand yielding a profitable marketplace milk price and thereby making not only the environment but also DAIRY FARMERS sustainable?
The management of DFA recently made a new environmental commitment on behalf of it’s dairy farmer co-op members to reduce greenhouse gas (GHG) emissions by 30% by 2030. Good idea!
Food industry watchers express interest “to see if DFA will see a positive consumer reaction from it’s new commitment.”
MORE IMPORTANTLY, will DFA management see a positive DAIRY FARMER member reaction from management’s “new environmental commitment”?
DFA dairy farmer members understand that DFA management’s primary purpose and priority is to preserve as many DFA dairy farmer members as possible by helping dairy farmer members obtain a profitable milk price from the marketplace.
Since existing DFA management’s policies continue to fail to provide it’s dairy farmer members with a profitable milk price, it is difficult to imagine how DFA management’s new environmental commitment will “be profitable for farmers” as required by DSI UNLESS DFA management ALSO implements NDPO’s co-op management policies which will balance/match DFA’s milk intake with profitable marketplace demand for DFA’s member milk.
For there to be a positive DFA dairy farmer member reaction to their management’s new environmental commitment, dairy farmer members must FIRST financially survive with a profitable milk price.
WHAT IS — Existing co-op management’s goal is to increase dairy product sales and market share. Co-op management increases sales by selling dairy products at a price less than domestic and gloabl market competition. Management accomplishes a “less” product price by encouraging excess milk production greater than profitable demand, enabling management to pay dairy farmers LESS for the milk that goes into their dairy products.
WHAT SHOULD BE — Existing co-op management’s goal should NOT be self-benefit through product sales at the expense of a profitable dairy farmer milk price, but rather, to encourage a milk supply balanced with profitable marketplace demand and paying a profitable milke price to co-op dairy farmer member owners by implementing NDPO’s co-op management policies FOR THE BENEFIT OF DAIRY FARMER CO-OP MEMBERS.
To: Board of Directors, Dairy Farmers of America
From: Gary Genske, Shawnee Dairy, LLC, producer/member
I have received several items of correspondence from DFA recently discussing the imbalance between milk production and milk consumption as a result of the COVID-19 pandemic (and nothing regarding the trade imbalance) and for the immediate need for 10% production reduction. If we producers are to cut production by 10% in addition to accepting the current/future low milk prices for the milk we produce, and to help our co-op survive through this pandemic, I suggest two things:
Please insist that these two suggestions are implemented immediately. Thank you.
NDPO Board Member
Shawnee Dairy, LLC
Dexter, New Mexico
May 6, 2020
Most remaining U.S. dairy farmers are at a crossroads.
To blindly continue taking direction from THEIR existing co-op management and strive to make the maximum quantity of milk possible and continue receiving a milk price less than the cost to make the milk, OR see what actually really is and what should be done.
Truth means agreement with reality.
The truth NDPO speaks is not dependent upon anyone’s agreement nor diminished by anyone’s rejection.
It simply is true marketplace reality.
It takes courage to see reality and what should be done.
Life punishes those who come too late, said Gorbachev.
Dairy farmers are at a crossroads and it is not enough for them to continue to take direction from THEIR existing hired co-op management — they must see their reality and do what has to be done and do it NOW.
The loss of U.S. dairy farm families can be reduced & most remaining dairy farmers can survive and receive a fair and profitable milk price from the marketplace IF they choose to change THEIR co-op management personnel and/or policies to those that will continuously balance co-op milk intake with profitable demand for member milk by implementing NDPO’s co-op management policies.
Constant awareness and adjustment of supply to changing marketplace profitable demand is required and is done by all successful product making businesses on an on-going, continuous basis.
The implementation of NDPO co-op management policies will help dairy farmers continuously balance the milk supply they make with both domestic and global profitable demand and thereby receive a fair, profitable milk price from the marketplace.
NDPO Board Member