Dairy has a Tougher Road Ahead

Hey, welcome to the Washington State Farm Bureau Report. Matt Daley, president and CEO of GEA Agriculture, was recently interviewed by Association of Equipment Manufacturers Senior VP Charlie O'Brian about the state of our US dairy markets, and after I had heard the interview I thought it was pretty insightful, given the ups and down of the milk market. Here's Matt:

Daley : We've got a tougher road ahead; we probably got another 8 to 12 months of what I would call below average milk prices. We are obviously affected very much by the global marketplace. That global marketplace has more milk than it's ever had before. Thus we are driving the price down simply because the US dairy farmer exports 14 to 17 percent of his milk outside of the country, and if those countries outside the US aren't buying you've got more milk locally which drives the price down which is what we are experiencing now, not to a disastrous level. Most of our producer enjoyed a very good 2012 through 2015 thus there is a lot less debt out there, there is still a lot of expansion going on thus our marketplace is still very healthy.

We have about approximately 480 dairy farms in Washington state with about 550 cows for the average herd size.