LITTLE ROCK — Dairies in Arkansas continued to downsize their herds in the fourth quarter and the state’s milk production continued to decline after a severe drought struck the state and most of the U.S. in 2012.
The Arkansas Dairy Stabilization Program, which made subsidy payments to farmers based on milk prices and production, also expired in June, adding pressure on dairy operations.
According to the U.S. Department of Agriculture, Arkansas had 9,500 milk cows in the fourth quarter, down 1,500 head, or a 14 percent drop, compared with the corresponding period last year. Nationally, herd size was virtually unchanged, with 9.2 million animals for the fourth quarter compared with 9.22 a year earlier.
The state has about 90 dairy operations, according to the Arkansas Agriculture Department.
Arkansas’ milk production was 29 million pounds in the fourth quarter, down 12 percent from 33 million pounds a year earlier. Nationally, dairies produced 49 billion pounds of milk, up 1 percent from 48.7 billion for the fourth quarter of 2011.
According to the USDA’s National Dairy Retail Report, the advertised price of a half gallon of milk was $2.01 for the last two weeks of January, down 29 cents compared to two weeks ago.
Bruce Tencleve, coordinator for the dairy division of the Arkansas Farm Bureau, said milk prices for producers have been flat and have gone without increases for quite some time making it hard for dairy farmers to turn a profit.
“We’re going to see more people get out of the business if prices don’t increase,” he said of Arkansas.
Floyd Wiedower, general manager of the Arkansas Dairy Co-op Association based in Damascus, said Thursday that ongoing drought conditions is the primary challenge facing the fewer than 50 dairy farms in Arkansas that are part of the organization.
The co-op also serves parts of Oklahoma, Missouri and Kansas.
From April to July, Arkansas had an average rainfall total of 9.03 inches, the driest period on record. In August, 54 percent of Arkansas was considered in exceptional drought, the highest ranking, according to the National Drought Mitigation Center in Lincoln, Neb.
In early January, farms and ranches in 47 Arkansas counties were flagged by the U.S. Department of Agriculture as primary natural-disaster areas because of heat and drought.
Farmers and ranchers in those counties, along with 14 other contiguous ones, are eligible for low-interest emergency loans.
The USDA classified 2,245 counties in 39 states, or 71 percent of the U.S., as disaster areas because of drought in 2012.
Wiedower said the drought, coming on the heels of a dry 2011, drastically increased dairy farmer’s feed costs. Pastures dried up, which meant more hay had to be fed.
Because the drought was widespread, what hay that could be found tended to be low quality and expensive to truck in.
He said the loss of the dairy stabilization program which paid farmers about $2 per 100 pounds of production made the extra expense hard to cope with.
“That’s a payment that could have helped toward feed costs,” he said.
Business, Pages 25 on 01/25/2013