The U.S. Department of Agriculture’s most recent statistics reports show the number of dairy cooperatives in Wisconsin continues to shrink, leaving dairy farmers in the state with fewer options for selling their milk.
The number of agriculture cooperatives in Wisconsin dropped from 180 in 2000 to more than 110 in 2015, the Milwaukee Journal Sentinel reported. Dairy co-ops in Wisconsin dropped from 31 to 21 during that same period.
The explanation for the shrinkage is that cooperatives across the agricultural industry are consolidating, which is problematic for smaller dairy farms.
Darin Von Ruden, Westby dairy farmer and president of the Wisconsin Farmers Union, said he finds the increasing number of cooperative mergers worrisome.
“We have fewer and fewer places we can sell our products to,” Von Ruden said. “We’re lucky in southwest Wisconsin we have a few different places, but it’s a different story in the northwest.”
He said some cooperatives have become “marketing giants” in the Southwestern U.S.
“If that’s the way they’re going to carry on their business around the rest of the country, that is a scary thought for the 50- to 100-cow operators,” Von Ruden said.
Jim Wadsworth, agricultural economist of cooperative statistics in the Policy & Research Branch of USDA Cooperative Programs, said the cooperative consolidation trend is expected to continue when the 2016 and 2017 USADA reports come out.
A large portion of their members must vote in favor of the merger, sometimes up to 60 percent, before cooperatives merge. Such a large percentage is needed because producers lose local autonomy when cooperatives become bigger, Wadsworth said.
“In many cases, it’s an emotional thing for farmers,” Wadsworth said. “It goes back to their grandparents. They’ve always had this cooperative down the street, and all of the sudden it’s headquartered somewhere else.”