Schutz Thinks Industry Could Stabilize

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Mike Schutz, a Purdue Extension dairy specialist, says that the last few years of turbulence in the dairy industry could subside in the second half of this year if feed prices fall or at least stabilize.

Although the first part of 2013 likely will be stressful for producers, those who hold on should benefit from a relatively neutral economic outlook for the remainder of the year.

“The dairy industry is highly dependent on what happens with feed prices,” Schutz said. “We’re hopeful that feed prices will be reduced or stabilize with the planting of the 2013 crop, which will also hopefully help producers get back to approaching at least break-even or somewhat profitable prices.”

The 2012 drought hit the dairy industry hard by decreasing availability of feed while also increasing feed prices. Most dairy producers grow their own forages, but with drought-induced short supplies, many had to buy expensive forage from other growers.

Some producers are still short on forage supplies, so Schutz recommended that they keep a close eye on feed prices and check inventories frequently.

Farmers with low inventories can consider planting an early spring forage crop, such as spring oats. Spring oats can be sown in very early spring, giving farmers the opportunity to double-crop and produce more forage before next winter. Other options are sorghum-sudangrass, sudangrass or pearl millet, which can be sown in mid-May and ready for harvest by early July. Alfalfa can be sown by mid-April and also would produce a first harvest in July, followed by subsequent harvests for many years.

Source: Purdue Agriculture News, By: Amanda Gee