Because local restaurants have not been able to open, Dakin Dairy was forced to dump 48,000 gallons of milk in the first week of the shutdown.

Jerry Dakin and his wife Karen are among the last remaining dairy farmers in Manatee County. They’re also among the select group of workers deemed “essential” by government officials because they help supply the global food chain with milk.


But with the COVID-19 pandemic driving dairy and crop prices down, the Dakins’ essential work is losing value, leaving them looking toward a dark and uncertain future.


Because local restaurants have not been able to open, Dakin was forced to dump 48,000 gallons of milk in the first week of the shutdown. That cost him around $87,000. The farm is now dumping half that amount, but it still hurts.


About 92% of his restaurant business has been lost. Though none of the dairy’s 80 employees were let go, the farm sold 150 of its 2,400 cows and cut back on feed. It also reduced milk to $2.50 a gallon and sold it on site. Many people in the community have come out and purchased milk to support the business. Dakin is grateful but he is also worried.


“It’s really tough for us,” Dakin said. “We’re just trying to survive.”


Stay-at-home orders and social distancing mandates have severely limited business across the country, closing restaurants, schools and stores, leaving farmers across the country with no markets.


It’s about to get even worse.


Related: Coronavirus: Florida dairy farmers forced to dump excess milk


Milk prices on Friday are expected to plunge by a staggering 30%, the U.S. Department of Agriculture announced last week.


Milk prices will shrink from $16.64 for 11 gallons of milk to only $12.95, well below the cost processors and dairy farmers need to keep paying the bills. That will potentially cripple an already fragile dairy industry.


While dairy farmers here have petitioned the federal government to set a floor price for milk, officials have largely denied that request. Without help from the USDA, many multigenerational farmers in Florida, the largest dairy state in the Southeast, will shutter for good.


Terrible timing


The Dakins’ pandemic-induced financial woes build on a half-decade of economic difficulties for farmers, and come at a point when things were starting to look up, said Colleen Larson, regional dairy agent for the University of Florida/IFAS extension in south Florida.


Larson said there “was a sense of optimism” in the agriculture industry at the beginning of 2020. Dairy industry prices were looking better than they had in recent years.


Dairy farmers expect milk prices to fluctuate, but typically they go in a three-year cycle. The last slump extended longer, with fewer people drinking milk in part because of a surge in popularity of nondairy alternatives such as almond, oat and soy milks.


Dairy farms are dwindling. The USDA also reported that licensed dairy farm numbers in the country declined by 2,731, a total of 6.8%. There used to be 38 dairy farms in Manatee County. Only three remain, and they are in the Dakin family. Florida had 152 two years ago. Half remain.


But the economic downturn could cause the worst the industry has seen since the Great Recession, said Joe Wright, president of Southeast Milk Inc., one of the largest dairy cooperatives in Florida.


“It’ll be worse than what we’ve seen in any of our lifetimes,” said Wright, who also co-owns V&W Farms in Hardee County with his wife. “We have chaos and we need help from the federal government but they’re taking a hands-off approach.”


Eyes on Washington


Now, as the pandemic-induced national emergency stretches into its third month, Wright said the optimism of early 2020 is gone, and farmers are being forced to turn to the same place they always have to for help during challenging times: the federal government.


Southeast Milk Inc. and other stakeholders have asked the USDA for an emergency hearing to temporarily set the price of milk. Fluid milk prices are set largely on the prices of cheese, butter, milk powder and items with a longer shelf life.


Restaurants, coffee shops, universities and suppliers for school cafeterias were still buying some milk in March. The price was about $17.46 for a little over 11 gallons. Prices in April dropped to $16.64 and May fell to only 12.95. Summer is forecast to dip to as low as $11.19.



The Florida dairy industry has asked the USDA to set the price of milk at $15.68. That would allow farmers like Tommy Watkins, a third-generation farmer in Hardee County, to just scrape by.


But the USDA has denied such a request. In a letter to Florida stakeholders on Wednesday, Bruce Summers, the administrator for the USDA’s agricultural marketing service, told dairy farmers to look for other potential alternatives.


But there are few other alternatives.


Cows don’t shut off, and fluid milk, which is predominantly harvested in Florida, is highly perishable. It’s hard to cut corners as a dairy farmer and trying to curb production is a slow process, said Watkins, who owns C.R. Melear Dairy, a 7,600-acre family farm in Zolfo Springs.


“There is only so much you can do without jeopardizing the health of the cow,” Watkins said. “The other option is to sell your cows, but who is going to buy them now that meat packaging facilities are closed?”


Limited options


The Trump administration revealed a $15.5 billion initial pandemic relief package to farmers earlier this month. The program would provide direct payments to farmers and the federal government would purchase milk and meat and move them to food banks.


However, the USDA has put a cap of $125,000 on aid. As a collective, Southeast Milk Inc. is hemorrhaging about $70 million, Wright said.


Farmers are also eligible for assistance under the $2.2 trillion CARES Act through the Paycheck Protection Program, a $350 billion program aimed at supporting small businesses during the pandemic.


Dale McClellan, the owner of M&B Dairy and M&B Products Inc., provides 50% of the milk to schools in Florida. He employs about 150 people split between his processing plant in Hillsborough and the dairy farm in Citrus County. McClellan was eligible.


“Until that point, we hadn’t laid people off,” said McClellan. “But we were on the threshold and the PPP came at the right time.”


While the money won’t cover all of McClellan’s expenses, it will see him through the next several months.


While the payments will help farmers keep the lights on, they won’t do much to make up for lost revenue, leaving both lawmakers and farmers calling for Congress to include additional support for the agriculture industry in a potential fourth coronavirus relief package.


However, with the House of Representatives not set to return to Washington until early May, and with fierce negotiations over the contents of a fourth relief bill expected to continue, additional relief for farmers is unlikely to arrive quickly.


This story originally published to heraldtribune.com, and was shared to other Florida newspapers in the USA TODAY Network - Florida.