Dairy herd not growing like milk prices might suggest

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Dairy herd not growing like milk prices might suggest

A dairy lending specialist suggests the dairy herd is not growing commensurate to milk prices.

Greg Steele with Compeer Financial says when the market is this strong there’s usually a spike in dairy cows.

“Generally be encouraged whether it’s $24 or $25 milk, you would see the bulldozers rolling and contractors working to put up new barns.”

Despite some growth “around the fringes,” he tells Brownfield processor limitations and base program penalties are stunting that development.

“The way that producers have been able to expand is to buy a neighboring farm, by that base, and expand that way. But otherwise there’s a bit of a governor on the ability for the dairy industry to add cows.”

He points out another reason the U.S. dairy herd might not be growing that fast is because per-cow production continues to improve. 

Steele made these comments during a recent content partnership podcast between Brownfield and Compeer.

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