The Milk Market
Monday, July 2nd, 2007I’m just now listening to a story on Wisconsin Public Radio about farmers and milk production. The main focus on the story is the fact that, apparently, milk producers are making less today than they made 40 years ago. Ummm… yah? Let’s think about this.
1. I bet that the ability to produce a lot of milk for less money has become more and more possible over the last 40 years. You can inject your cows with chemicals (like bovine growth hormone) to make them produce more milk. You’ve got high-speed milkers, which mean you can have even more cows than before, and you’ve got factory farms, who milk 24/7. So there’s more milk on the market.
2. People probably aren’t drinking MORE milk than they were 40 years ago. Now, I wouldn’t argue overall consumption is down as the population has risen, but I know a lot of people who don’t drink milk on a daily basis. And people (including my mom’s husband Mark, and Dan) who don’t drink cow’s milk anymore; Mark drinks soy and Dan drinks rice.
So the supply has risen, the demand has not, and overall production costs have gone down. Yah, big surprise that these farmers aren’t making as much as they would have 40 years ago. Good thing the solution is easy – get out of the milk business! Sell off your cows, convince all your farmer friends to do the same. Start growing whatever crops will make you some money. Then, with no one producing any milk, the prices are sure to rise. Too bad for you: the person to which you sold all your cows is now making a fortune.