Maine dairy farmers are falling on hard times due to high grain prices, bad weather and rising fuel costs.
The Bangor Daily News reported that the yearly $570 million Maine industry is feeling the impacts of a drought throughout the Midwest that is boosting the price of feed. Dale Cole, president of the Maine Dairy Association’s board and a farmer with 90 to 100 cows in Sidney, told the paper that his monthly purchase of 38 tons of feed is costing about $3,000 more than last year.
A state program helps farmers in times of low prices, the paper reported, but the state’s 2003 Maine Dairy Stabilization Act — or the Tier program — doesn’t account for rising feed prices. Richard Kersbergen, of the University of Maine Cooperative Extension, told the paper that grain prices typically make up one third of a typical dairy farm’s overhead costs.
Maine’s 307 dairy farms produced nearly 51 million pounds of milk in August and have an annual economic impact of $570 million, Julie-Marie Bickford, executive director of the Maine Dairy Industry Association, told the BDN.
Bickford said the hard times also throws light on the price-setting model for dairy products, which she said has its origin on the Chicago Mercantile Exchange, creating a speculative pricing system that she said doesn’t take into account local market factors.
