EDITORIAL Economics of farming making a hard life even harder
Farm living has always been a difficult living. Workdays are 12 to 16 hours – every day, in all weather – and the labor can be grueling. A farmer, financially and practically, can rarely afford to take a day off. The cumulative cost of maintaining machinery, purchasing livestock and buying fuel can be prohibitive.
Washington and Greene counties, of course, have long agrarian traditions, and are still homes to a numerous farms. A leisurely drive through either county will verify that. Some spreads bear the “century” and “bicentennial” designations: farms owned by the same families for 100 or 200 years or more.
The industry is beset by challenges, though, ones that are causing this noble vocation – this necessary vocation – to diminish greatly across the nation. The Observer-Reporter’s Rick Shrum reported Sunday that between 2007 and 2012, Greene County lost 30 percent of its farms and 25 percent of its farmland, and Washington lost 5 percent of its farms during that period.
Economics today are making it increasingly difficult for all farmers to run their agribusinesses. But dairy operators, in particular, are getting hit hard with high production costs, low demand for whole milk and low prices for their signature product. Nationwide, they are receiving $14 to $15 per hundredweight (100 pounds) of milk, about two-thirds what they were paid in 2014.
“The economics of dairies say they should be paid $18, $19 or $20,” said Sam Minor, a dairy farmer and co-owner of the SpringHouse Country Market and Restaurant with his wife, Bev.
An oversupply has depressed prices paid to producers, which forces a conundrum for farmers. To make up for rising costs, farm owners have to continue to send their product to market and get what they can. So the surplus mounts.
“The only way to keep this business afloat is to increase production. When costs increase 10 percent, you have to produce 10 percent more or you quit,” said John Grice, who owns Folly Hollow Farm in South Franklin Township with his brother, Bruce. The Grices and Minors are among farmers who sell milk to cooperatives or other dairies. Some, like the Grices, also sell to cheese manufacturers.
Retail giant Walmart’s decision last summer to get into the dairy business – it will open its own bottling plant in Indiana next month – is further squeezing farmers. And although Dean Dairy Holdings announced last month it would terminate contracts with dairy operators in six states, including Pennsylvania, effective May 31, that move will have minimal effect in this end of the state.
No, farm living isn’t easy, but the owners/operators understand this is a lifestyle and will keep on keeping on. Someday, however, they will want to retire and either turn over the farm to a younger generation of the family, shut it down and live there – especially if they have gas and oil rights – or sell the land to a developer for a handsome return.
Younger generations, however, seem less and less inclined to follow this tradition, meaning farms will continue to diminish, even though they are necessary.