The United States is the second largest milk producer in the world and it has a very bright future in the dairy industry, thinks Greg Wickham, chief executive of Dairylea.
Mr Wickham, who will be speaking at the International Summit of Co-operatives, believes USA’s agriculture has a great ability to continue to expand production and meet the needs of the rising population, with co-operatives playing an important part in the process.
He hopes that by participating in the Summit he can exchange ideas and experiences with other co-operators from all over the world.
“We always learn something new from our peers in the rest in the world and we are looking forward to talking about how valuable it is for our farmers to participate in the co-operative form of business,” says Mr Wickham.
Over 70% of the milk produced in the USA is marketed through co-operatives, one of which is Dairylea. Set up in 1907, Dairylea Cooperative is an agricultural marketing and service organisation owned by its 2,000 members.
“Our farmers appreciate working together,” says Mr Wickham. Dairylea members are guaranteed a market for their milk. They can also maximise profits and reduce costs by offering competitive premiums, a multi-tiered quality incentive programme and volume incentive programmes.
Through the co-operative, farmers can also gain access to various cost-saving programmes and services, from health and workers’ compensation insurance to loan or farm input purchasing programmes as well as business planning and consulting.
“We sell them farm supplies, we provide insurance services for them, and we work with them on risk-management opportunities to help them reduce the risk associated with milk and feed price uncertainty,” added Mr Wickham.
“The other thing they appreciate about working together is that we have enough size and scope of operation that we can participate in the global market place.”
On 1 April the co-op merged with Dairy Farmers of America (DFA), a 13,000 nationwide dairy farmer co-operative. “We have had a partnership for 15 years with DFA and as we looked at the dairy industry’s future we felt that it would be best if we merged with DFA,” said Mr Wickham.
Attracting more young people is also a key priority for Dairylea and DFA, both offering scholarships to students who study some forms of food production. “College has become expensive and we try to provide that support they need,” he said.
Mr Wickham believes that one positive outcome of the new Farm Bill passed in January by the House of Representatives is the establishment of a dairy margin insurance programme. The margin is the difference between the all-milk price and feed costs.
The insurance, which in this way will be slightly subsidised by the government, would help them if there was a serious crisis and the operation would go into extended loses.
Mr Wickham says America’s agriculture has a great ability to continue to expand production and meet the rising needs of the population, but that maximising the technology should remain a priority. Over the past 10 years, the USA increased milk exports from 4% to 15%.
“One challenge we face is that some countries produce food without the use of certain technologies – and if we don’t maximise the technology, there will be less food and it will be a little more expensive,” he says. “I think the US has a very bright future in the dairy industry. Our philosophy is that when farmers work together, farmers win.”