Land ownership key for dairy farms

3:08 PM, Apr. 9, 2013  |  Comments
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Despite a slick ad campaign to the contrary, most of us in Wisconsin are pretty sure that our dairy cows are happier than their California cousins.

Based on recent figures, it seems that the same is likely true for the dairy farm owners. California lost 105 dairy farms in 2012. That's a lot of farms any way you slice it, but in a state like California with less than 1,600 dairy herds (compared to around 12,000 in Wisconsin) losing more than 100 herds in a year is a painful blow.

Why were California dairies hit so hard in 2012? In short, the risks inherent in the California model of dairying came home to roost. In contrast to Wisconsin dairy farms, which own land as well as cows and produce a high percentage of their own feed, California dairies rely on purchasing grain and forages from out of state. With corn prices at record highs and alfalfa stores at record lows due to the drought, California dairies felt the pinch when it came to feeding cows last year.

According to the 2007 USDA Census of Agriculture, 30 percent of farmland in Wisconsin is rented. In California, by contrast, the percentage of rented acres is closer to 50 percent. It is important to note that this figure represents all types of crops and operations, not just dairy farms. But to the extent that the figures are emblematic of the differences between the Wisconsin and California models of agriculture, these numbers suggest that land ownership is a risk mitigation strategy that has served Wisconsin farmers well in an era of great economic volatility.

Sometimes we don't know a good thing until it's gone. We've got a good thing going here in Wisconsin - animal agriculture still largely is tied to the land base that supports it. The received wisdom is that the hottest trends in finance and fashion start on the coasts and work their way inward.

Our coastal compatriots might chide us for being behind the times, but we also have the chance to see which ideas work and which don't. The current state of affairs in California suggests strongly that the concept of separating the acres from the cows is a bandwagon we do not want to hop on.

Why should we be contemplating these questions right now in Wisconsin?

For one, the trend of renting rather than owning acres is growing: the percent of rented acres was 26 percent in 1987 and 27 percent in 1997. If one of our methods for supporting the dairy industry is minimizing risk, that is not a positive trend. Taking some of the steam out of the current run-up in land values would go a long way toward making land ownership viable for all farms in Wisconsin, and particularly beginning farms.

In this context, we should question the current proposal by the governor to make it easier for foreign corporations and individuals to buy large tracts of land in Wisconsin. Such a change would likely have an inflationary effect on land values, driving land ownership even further out of reach.

The strength of Wisconsin's dairy farms lies in their diversification and resilience - a brilliant system where manure feeds the plants, the plants feed the cows and the cows feed the farmer. All of this works best when the cows and the land are part of the same farm. A farm that is producing both grain and milk is in a much better position to weather price and weather shocks than one that is not.

Our friend Nick Levendofsky from Kansas Farmers Union recently shared a photo of a circa-1970 Moor Man's feed decorative plate. It features a picture of a barn and silo surrounded by rolling fields of grain and pasture, and flanked on three sides by beef and dairy cows, pigs, chickens and sheep. The inscription at the top reads: "Buy only what you cannot raise or process on your farm or ranch."

The cows on that plate, feeding on the bounty from the surrounding hillsides, look pretty happy to me.

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