WEATHERSFIELD — When David Fuller studied agriculture at the University of New Hampshire 30 years ago, rock farming wasn’t part of the course load.
Maybe it should have been.
“I never looked at it until I heard some of the numbers being thrown around,” Fuller said while mounting a tire onto a rim at his 225-acre Perkinsville farm on Thursday.
Fuller, a dairy farmer, figures the money he’ll get from selling stone to high-end masonry projects will offset the financial hits he has taken recently from lower milk prices. Collecting rock is backbreaking work, but it will help him keep his farm without borrowing money or selling off land.
Dairy farmers across New England have been struggling for decades in a market that has seen steady declines in milk consumption and increased competition from the west. The problems have only gotten worse in recent months, as milk prices have dropped more than 20 percent since December and continue to fall.
Farmers have responded by producing more milk in an effort to pay for rising feed and fuel costs, but that has only made matters worse and led to a Catch-22 situation that is crippling a piece of New England’s agricultural economy.
“At the end of the day, it comes down to what the farmer sees on his check,” said Bob Parsons, an agricultural economist at the University of Vermont.
The problems begin with how the milk industry is regulated. The U.S. Department of Agriculture establishes national milk prices — the money farmers get paid for their milk — every month. Those prices are based on national supply and demand. As demand goes up, so do prices and farmers’ monthly paychecks. If supply outpaces demand, then farmers’ checks get smaller.
The goal is an even balance between the two, but lately, the scales have tipped heavily toward the supply side.
Milk consumption has steadily declined since it peaked in 1945, but especially so in the last 35 years. Fluid milk consumption decreased nearly 28 percent between 1970 to 2000, according to the U.S. Department of Agriculture. Fuel prices are up, which has a direct link to feed prices — the highest cost to a dairy farmer. Feed costs have increased 35 percent in the past year, according to Parsons.
Farmers respond by milking more cows to help pay for rising expenses. That throws the supply and demand into further imbalance, lowering milk prices even more.
The problem is the worst it has been in a decade or more, with production headed for a 5 percent increase this year. A normal increase is around 2 percent. Bottlers and distributors are spared much of the financial blow, because they can adjust prices to meet market conditions. But because milk prices are set by the government and non-negotiable, farmers take the greatest impact.
“The unfortunate part is that everyone else can increase their prices and pass along the cost,” said Doug DiMento, director of communication for Agri-Mark, a cooperative of nearly 1,500 New England and New York dairy farmers. “Farmers can’t do that. That’s the unfair part in the national milk pricing system.”
New England farmers suffer the most. Even though dairy accounts for 70 percent of Vermont’s agricultural economy, the state represents less than 2 percent of the nation’s overall dairy production. Most of it comes from western states like California, which is the nation’s largest producer and accounts for about 20 percent of overall supply. As that excess milk and cream heads east, a domino effect occurs across the U.S. that sends Pennsylvania and New York products into Vermont and New Hampshire. The increased competition, combined with rising expenses and lower milk prices, has forced farmers to take stock.
The options are limited. Those that are not forced to shut down either borrow money or, like Fuller, find a way to supplement income.
“The farmers that are left in business now, almost every farmer I know is diversified,” Dimento said.
Jim Taylor of Taylor Farms in Meriden said he and his family started sugaring 16 years ago to make up for dairy losses. Maple syrup and candy sales now account for about 80 percent of their net income, Taylor said. And it’s a lot easier.
“Dairy processing is a lot different than maple,” he said. “With maple, you spend three weeks in the spring pulling your hair out and the rest of the year the sap doesn’t run. But you have to find a home for that milk every single day of the year.”
The maple sugaring also lets them keep more of the overall profits from their hard work, Taylor said. They produce, market and distribute the product themselves, whereas with milk, that money is spread between the dairy farmer, bottler and distributor.
A few dairy farms have managed to eliminate the middle man and keep the profits for themselves. McNamara Dairy in Plainfield has bottled their own milk for the past 11 years. Unfortunately, few people can afford the pasteurizing and bottling equipment.
DiMento estimates it would be an investment of between $400,000 to $600,000 for an average-sized farm.
Mary McNamara, who owns McNamara Dairy with her husband, said they purchased their 50-year-old equipment used.
“We couldn’t have done it if we didn’t,” she said.
Dairy farming these days is an expensive business. The average dairy farm in Vermont is an $800,000 investment, DiMento said.
Ironically, it was the profit returns that first attracted Fuller to the dairy industry when he was in college.
“It was the only real farming you could make a living at,” he said. “All the other commodities didn’t have the capabilities to support a family. You couldn’t have beef or chicken. Dairy’s been the real mainstay of the Northeast.”
But that doesn’t mean he questions the decision. At 47, he said he’s not willing to find a “real job” and refuses to sell off any of his land to supplement lost income. But he’s been losing 30 to 40 percent of his investment each month, a trend he can’t afford. So he’s looking at other options, and though he’ll stay a dairy farmer, the nature of his business will have to change.
He jokes that he’s even got a new marketing strategy, which he’ll put on a bumper sticker.
“Got Rock?” he grins.