Agriculture commissioner says Maine dairy farms in trouble

AUGUSTA – As many as a quarter of Maine’s dairy farmers could go out of business, with at least some of their land for sale in the next year, if milk prices remain low, Agriculture Commissioner Robert Spear says.

Spear told the governor’s 19-member dairy task force at its inaugural meeting Monday that members must look for creative solutions to the problem of sustained low milk prices in the wake of the dissolution of the New England Dairy Compact.

But they also may have to recommend some kind of financial support if the state wants to preserve the open space and character that has been a traditional part of Maine.

Gov. John Baldacci is willing to front the industry only $6.3 million in financial support until a long-term solution can be submitted to the Legislature next January, Spear said Monday.

“That’s why the governor did not want to jump at anything early … so he’s sure whatever way we decide to go, there’s some solid reasoning behind it,” Spear said. “He doesn’t want to just jump at putting a tax on and putting money into it without looking at a long-term solution.”

The Governor’s Task Force on the Sustainability of the Dairy Industry in Maine plans to meet on an accelerated schedule every other week, aiming to conclude its work early in the fall.

The executive order creating the panel requires its report by Nov. 15, Spear said. But even at the first meeting, the problem was clear to task force members who gathered at the University of Maine at Augusta.

“It’s not brain surgery. We’ve got to find a way to get farmers a fair price for their products,” said Gary Hammond of Hammond Tractor, a Fairfield farm tractor and equipment dealer.

Spear said the state has 403 dairy farms, down from 450 just two years ago, maintaining 40,000 cows on about 150,000 acres. He said 100 of those farms are likely to be gone in a year if nothing changes.

Turner dairy farmer Ralph Caldwell warned that the New England dairy industry is at risk from much cheaper milk from the west. “We’ve got to be very careful and creative or we’re going to get swallowed,” Caldwell said.

While some dairy farmers are losing money on every cow with current milk prices, other farmers are making money, some with higher debt, the result of efforts to increase the size of their farms for better economies of scale.

“Some are not just more efficient but are better managers,” said Fred Hutchinson, task force chairman and former president of the University of Maine.