Eric Brown
The Fence Post

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June 4, 2013
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Primed for growth: Nebraska advocates hoping abundance of feed, water will bring more dairymen to the Cornhusker state

The story of dairy growth in Nebraska in recent times has been a simple tale to tell.

There just hasn’t been much going on, as experts in the state and statistics will explain.

During the last decade, Nebraska’s milk production has only increased by about 1 percent.

Some people, like Rod Johnson with the Nebraska State Dairy Association, and others who closely follow the industry in that state, are left asking themselves, “why?”

Standing as one of the nation’s leading producers of corn and distiller grains, Nebraska has the abundance of feed needed to host additional dairy cows — each of which can eat 50-plus pounds of dry matter daily.

Also, the Cornhusker state — which is tops in the nation for its number of irrigated farm acres, according to U.S. Department of Agriculture figures — has the water necessary to support significant dairy growth, Johnson said.

“Even in the drought last year, we never had a feed shortage, because of our ability to irrigate,” he added, while also noting that Nebraska has low energy costs compared to other regions.

“And with access to Interstate 80, Nebraska is well-positioned to move dairy products or milk east or west,” according to Robert Tigner, a University of Nebraska-Lincoln dairy specialist, who also pointed out that the limited human population in his state competing for land and water adds to Nebraska’s agricultural benefits. “We can provide milk and milk products to states east and south of NE because of I-29, I-35 and I-80.”

But despite its plethora of feed, water and other resources needed for a milk-production upswing, the growth hasn’t happened, and Nebraska remains a milk-deficient state, Johnson said.

Dairy processors in Nebraska have to reach out of state to meet their milk needs.

Johnson and others are trying to change that.

In his position as the leader of the state’s dairy organization, he’s leading the charge to get the word out on Nebraska’s growth potential, and convince milk producers in other states that Nebraska is the place to be.

Johnson knows at least some dairymen are willing to relocate.

In neighboring Colorado, the northern part of the state has seen rapid growth in recent years.

In 2010, Leprino Foods began construction of a new cheese-processing plant in Greeley, Colo., which is now in operation.

Leprino, the largest producer of mozzarella cheese in the world, made the move to Greeley under the impression that the northern Colorado dairy industry would expand greatly — adding as many as 60,000 cows in the region over the next several years.

Dairymen from California, New York and Michigan have so far answered that call.

In the cases of California milk producers, some — including A.J. De Jager, who’s new dairy went into operation near Greeley last month — have said they’ve been leaving their former state because of the increase in regulations that have added to their production costs.

According to dairy experts in Colorado, there are currently 10 dairies project under construction that could be up and running by the end of this year.

Nebraska doesn’t have an incoming cheese facility that’s expected to in take 7 million pounds of milk daily— as Leprino’s Greeley facility will do once it’s fully up and running — to entice dairymen from out of state.

But Johnson believes Nebraska’s abundant feed supply and water availability are enough to bring them his way.

“We’re not expecting the kind of growth they’ve seen in places like Colorado,” Johnson said. “But we do believe we have potential for quite a bit of growth.

“We just need to get the word out on why this is a great place.”

But while there’s opportunity in Nebraska, there are challenges for the dairy industry as a whole.

Building a new dairy is an endeavor that can add up into the millions of dollars.

Additionally, what was dubbed as the “Great Dairy Recession” is still close in the rear-view mirror for dairy farmers.

In 2009, milk prices sank, due to lowered demand in the weak economy, and farmers weren’t getting enough for their milk to keep up with high feed prices.

Even in northern Colorado, the appeal of having a nearby cheese-processing facility isn’t enough to persuade most dairymen to make the move.

Tom Haren — owner of Ag Professionals in Longmont, Colo., which served as the developer for most of the new dairies going into operation in northern Colorado — said about nine out of ten people who’ve talked with him and have expressed heavy interest in moving to northern Colorado to be closer to Leprino have backed out.

“We know there are challenges, but we’re not looking for any staggering growth,” Johnson said. “We just want steady growth, and we believe we have what’s needed here to make that happen.

“We just have to keep putting the word out.” ❖

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The Fence Post Updated Oct 17, 2013 09:25AM Published Aug 5, 2013 01:55PM Copyright 2013 The Fence Post. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.