Some Idaho dairymen won’t be having the brightest of holidays this year after buyers informed them they will no longer purchase their milk.
The Idaho Dairymen’s Association estimates the shift in supply contracts will see upward of 10,000 cows sold off in the next few months, said Rick Naerebout, the association’s CEO.
The cause is an increase in milk supply and the inability of buyers to continue to move any oversupply to surrounding states because of high costs. Buyers have done that in the past to balance markets during the peak production period of spring through fall, he said.
The bottom line is that even without a significant increase in cow numbers, dairymen’s efficiency in turning feed to milk continues to increase milk production per cow. Idaho is now at a point where increasing milk supply is forcing dairy farmers to sell off cows, he said.
“We’re at the point today where milk production is far greater than our ability to process it during the peak months,” he said.
There is not enough processing capacity for the milk in the state or even the Salt Lake City market, he said.
The effects will be felt statewide. Affected producers with single facilities will potentially call it quits completely. Others with multiple facilities might idle one, he said.
“It’s really unfortunate. It’s a situation we’ve never had where somebody wasn’t able to buy the milk,” he said.