dairies going bust

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bigbull338

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a month or so back i heard where the bank was gonna close down a big dairy.the dairy they was gonna close has 3000 or 4000 cows plus 4000 heifers.well that dairy filed bankruptcy.the guy couldnt even pay his feed bill.bet he wishes he never built that 80 cow rotery barn.i hear theres 2 or 3 more big dairies in trouble.
 

francismilker

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It's my understanding that one mega dairy out in Colorado went down and took the whole town with it. The bank that loaned the dairy money also had the town's money. It seems someone ought to do more research before putting in a big operation everytime the milk price spikes a little.
 
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bigbull338

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the dairy that went down had been in business here for 15 or 20yrs.as well as the other dairies that are in trouble.they got in so deep that they cant make the payments.i figure he will wipe out all of his unsecured debt an keep on milking.
 

maesy

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that's why everybody needs their own cow!! keep it simple and local and the gov't out of it :)
pasteurization and homogenization and subsidation...I think... are the worst things that've happened to dairy farming
 

novaman

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maesy":iiey4owi said:
that's why everybody needs their own cow!! keep it simple and local and the gov't out of it :)
pasteurization and homogenization and subsidation...I think... are the worst things that've happened to dairy farming
I can agree that subsidies aren't helping anything but pasteurization is one of the best things to happen IMO. It has made for a safer product, helping assure consumers they will always have a safe, wholesome food. As far as the dairies going bust it would seem that the advantage large dairies have in profits are also becoming their downfall when the prices are less than break even.
 

TexasBred

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francismilker":di9hxtfl said:
It's my understanding that one mega dairy out in Colorado went down and took the whole town with it. The bank that loaned the dairy money also had the town's money. It seems someone ought to do more research before putting in a big operation everytime the milk price spikes a little.

francis this is just typical. Milk prices go up and dairies increase herd size....flood the market with milk eventually driving milk prices down.......milk prices go down many increase the herd size and try to operate stictly on "cash flow" which always catches up with you sooner or latter. Not toally different than kiting checks. Some or just very very poor managers...others have worked all their life, done well but have now exhausted all reserves and are at the end of their rope. I don't know too many banks in this economy that would even go along with a Chapter 11 or Chapter 13 bankruptcy....only putting off the inevitable.
 

HerefordSire

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bigbull338":3mmwynrm said:
a month or so back i heard where the bank was gonna close down a big dairy.the dairy they was gonna close has 3000 or 4000 cows plus 4000 heifers.well that dairy filed bankruptcy.the guy couldnt even pay his feed bill.bet he wishes he never built that 80 cow rotery barn.i hear theres 2 or 3 more big dairies in trouble.


I bought milk for less than $2 per gallon the other day.

viewtopic.php?f=6&t=59703
 

grannysoo

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It's not uncommon to buy 1.79 - 1.99 per gallon milk here. Butter had got down to 1.50 per pound, now it's back up to 2.50 per pound.
 

dun

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About 6 months ago the neighbors took on a partner. He bought his own cows and brought them into the herd. Tomorrow his cows all go to the dairy sale. He decided that as much as he likes dairying he can't afford to lose that much money each month. Next month the original dairyman is selling all his cows and shutting down.
 

novaman

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dun":obusdcvy said:
About 6 months ago the neighbors took on a partner. He bought his own cows and brought them into the herd. Tomorrow his cows all go to the dairy sale. He decided that as much as he likes dairying he can't afford to lose that much money each month. Next month the original dairyman is selling all his cows and shutting down.
It doesn't surprise me to see dairies continuing to go out but with light at the end of the tunnel it does make me wonder why they would hang on this long only to quit now. With corn being cheap (hopefully it doesn't freeze soon or it won't be cheap for long) the cost of production (at least for me) has been moving down throughout the year. In fact I am approaching break even with the current milk prices. There has to be others that are seeing movement towards a profit for the first time this year.
 

dun

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novaman":35h90hal said:
dun":35h90hal said:
About 6 months ago the neighbors took on a partner. He bought his own cows and brought them into the herd. Tomorrow his cows all go to the dairy sale. He decided that as much as he likes dairying he can't afford to lose that much money each month. Next month the original dairyman is selling all his cows and shutting down.
It doesn't surprise me to see dairies continuing to go out but with light at the end of the tunnel it does make me wonder why they would hang on this long only to quit now. With corn being cheap (hopefully it doesn't freeze soon or it won't be cheap for long) the cost of production (at least for me) has been moving down throughout the year. In fact I am approaching break even with the current milk prices. There has to be others that are seeing movement towards a profit for the first time this year.

Movement is all well and good, but when he has to sign his milk check over to the feed company and still right another check out of savings to cover the rest it gets pretty iffy. I'm just afraid that the light at the end of the tunnel is a train heading towards you.
 

TexasBred

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novaman":1ws3rw73 said:
dun":1ws3rw73 said:
About 6 months ago the neighbors took on a partner. He bought his own cows and brought them into the herd. Tomorrow his cows all go to the dairy sale. He decided that as much as he likes dairying he can't afford to lose that much money each month. Next month the original dairyman is selling all his cows and shutting down.
It doesn't surprise me to see dairies continuing to go out but with light at the end of the tunnel it does make me wonder why they would hang on this long only to quit now. With corn being cheap (hopefully it doesn't freeze soon or it won't be cheap for long) the cost of production (at least for me) has been moving down throughout the year. In fact I am approaching break even with the current milk prices. There has to be others that are seeing movement towards a profit for the first time this year.

Nova, I know nothing of how you folks operate up there but in this area there is no light at the end of the tunnel. True, corn prices are down, but protein is sky high. Most by-products used in feed are still strong as well although a bit less expensive than last year. Fuel is also down, but utilities, labor, equipment, barn supplies etc. are all still expensive. With the drought in Texas hay will be very expensive. Corn silage will cost over $80 a ton by the time you get it in the pit or silo or if you have to buy it and truck it very far. For the guy who has gradually drained all his savings over the past year there isn't much to look forward to. To the guy that says he's making money on $9.50 a hundred-weight milk I say BS.
 

francismilker

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TexasBred":9nveyffj said:
novaman":9nveyffj said:
dun":9nveyffj said:
About 6 months ago the neighbors took on a partner. He bought his own cows and brought them into the herd. Tomorrow his cows all go to the dairy sale. He decided that as much as he likes dairying he can't afford to lose that much money each month. Next month the original dairyman is selling all his cows and shutting down.
It doesn't surprise me to see dairies continuing to go out but with light at the end of the tunnel it does make me wonder why they would hang on this long only to quit now. With corn being cheap (hopefully it doesn't freeze soon or it won't be cheap for long) the cost of production (at least for me) has been moving down throughout the year. In fact I am approaching break even with the current milk prices. There has to be others that are seeing movement towards a profit for the first time this year.

Nova, I know nothing of how you folks operate up there but in this area there is no light at the end of the tunnel. True, corn prices are down, but protein is sky high. Most by-products used in feed are still strong as well although a bit less expensive than last year. Fuel is also down, but utilities, labor, equipment, barn supplies etc. are all still expensive. With the drought in Texas hay will be very expensive. Corn silage will cost over $80 a ton by the time you get it in the pit or silo or if you have to buy it and truck it very far. For the guy who has gradually drained all his savings over the past year there isn't much to look forward to. To the guy that says he's making money on $9.50 a hundred-weight milk I say BS.


I'd say AMEN to that TexasBred. My friend that just went out showed his break even price at 15.50 and said it was costing him a little over $300 per cow per month to milk cows. He grew all of his own feed other than ordering out a semi load of corn to mix in with his TMR.
 

novaman

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I agree you can't make money at $9.50 but I'm at $11.40 right now and my break even is nowhere near $15.50. At $300 per cow per month that's $10/day. I think there is room for improvement on that one.
 

TexasBred

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novaman":25s114m7 said:
I agree you can't make money at $9.50 but I'm at $11.40 right now and my break even is nowhere near $15.50. At $300 per cow per month that's $10/day. I think there is room for improvement on that one.

A TMR down here runs real close to $7.00 per cow per day and most dairies are doing good to be averaging 45-48 lbs. per head per day in this heat. That don't leave much if any especially if they have any debts servicing at all and are using any hired labor.
 

novaman

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TexasBred":24uxeg6i said:
novaman":24uxeg6i said:
I agree you can't make money at $9.50 but I'm at $11.40 right now and my break even is nowhere near $15.50. At $300 per cow per month that's $10/day. I think there is room for improvement on that one.

A TMR down here runs real close to $7.00 per cow per day and most dairies are doing good to be averaging 45-48 lbs. per head per day in this heat. That don't leave much if any especially if they have any debts servicing at all and are using any hired labor.
If that's the case then I can see your point. I'm under $4 per head per day on feed.
 

GMN

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This topic is doom and glooming me out-enough already. I decided I was just gonan weather this storm and get thru it anyway I can, and be done with it. I think in times like these its gonna be the smaller dairies that survive, and the bigger ones will fold, which in the end, will be better for everyone and the milk price.

Novaman-$11.40 that is high compared to around here, count yourself lucky, last month milk prices went down-not up.

GMN
 

TexasBred

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novaman":29ql0uaa said:
TexasBred":29ql0uaa said:
novaman":29ql0uaa said:
I agree you can't make money at $9.50 but I'm at $11.40 right now and my break even is nowhere near $15.50. At $300 per cow per month that's $10/day. I think there is room for improvement on that one.

A TMR down here runs real close to $7.00 per cow per day and most dairies are doing good to be averaging 45-48 lbs. per head per day in this heat. That don't leave much if any especially if they have any debts servicing at all and are using any hired labor.
If that's the case then I can see your point. I'm under $4 per head per day on feed.

Your'e kidding???? What are you feeding and how much??? My feed cost that much 15 years ago
 

novaman

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TexasBred":2vooryyi said:
Your'e kidding???? What are you feeding and how much??? My feed cost that much 15 years ago
I just updated my prices so this is current.

$ per day: Cost per unit: Pounds/head
Corn 0.84 3.05 15.5
Alfalfa Hay 1.44 70 41
Modified Distillers 0.19 47 8
Mineral/SBM 0.21 427 1
Molasses 0.50 287 3.5
Feed cost per cow $3.18 69 lbs/hd

This ration is balanced for a theoretical production of 75 pounds.
 

TexasBred

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novaman":xe6q0n0l said:
TexasBred":xe6q0n0l said:
Your'e kidding???? What are you feeding and how much??? My feed cost that much 15 years ago
I just updated my prices so this is current.

$ per day: Cost per unit: Pounds/head
Corn 0.84 3.05 15.5
Alfalfa Hay 1.44 70 41
Modified Distillers 0.19 47 8
Mineral/SBM 0.21 427 1
Molasses 0.50 287 3.5
Feed cost per cow $3.18 69 lbs/hd

This ration is balanced for a theoretical production of 75 pounds.

Looks like a good ration especially if you can raise or buy those ingredients at the price stated. Should make milk as well as pretty good BF and Protein
 

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