As dairies in other states lose contracts, Colo. dairies have found balance
June 8, 2018
While some say no man is an island, Colorado's dairy industry could be compared to one. As fluid milk processing facilities are closing, and dairies are losing their milk contracts due, in part, to a surplus of milk, Colorado dairy producers have found balance to meet demand.
Norm Dinis, owner of Empire Dairy in Wiggins, Colo., said Colorado's dairy industry is the picture of balance.
"We've done a really good job over the last 30 years of supply management," he said. "We're unique here that we're almost an island here in the middle of the country. We don't have a lot of processing here in Colorado so there aren't many processors competing for milk."
Without fierce competition for milk prompting dairies to constantly be on the hunt for the best contract, Dinis said producers have been able to form partnerships with Dairy Farmers of America and, as such, have stabilized supply and built important relationships. Dinis serves as a director in DFA as well as a member of the Political Action Committee. Leprino Foods, which is a cheese processor and accepts about 70 percent of the state's milk; Meadowgold, Safeway, Kroger and Sinton's are the main fluid milk processors.
The supply management programs in place in Colorado do not restrict new dairies from coming into the state, Dinis said.
"The last dairy was built six months ago in Roggen," he said. "That dairy, once it comes on line at full production, Leprino in Greeley will be at 100 percent capacity. Then we'll be in balance. We'll have enough cows to supply all of the manufacturing in Colorado."
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DFA will market the milk of any dairies that may enter the state, he said. However, in the event of a surplus of milk, that dairy would have to pay the full amount of balancing costs, or the cost of either processing it into powder or shipping it out of state.
"We won't burden existing members with the expense of trying to get rid of that milk," he said. "For a new guy, there's no base or quota so he's at the mercy of an open market."
Despite the security of a well-balanced market, Colorado is facing similar challenges to agriculture operations both in state and across the country in terms of a workforce. Many dairies are beginning to utilize robotics but Dinis said he would prefer to depend upon a steady stream of immigrant labor.
"We wish we could operate like we have for the last 30 years," he said. "Unfortunately, with the attitude in the United States, especially under this current administration, guys are seeing the writing on the wall and they're trying to eliminate some of that labor. There's just not the supply of labor that's needed."
The use of robotics can potentially eliminate 25 percent of labor needs, he said. Dinis said he is particularly fortunate to have an older, more experienced group of employees, some of whom have been with the dairy since it opened.
"It's an aging workforce," he said. "We're not finding a lot of the younger generations to replace these guys. Once my older generation starts to retire, there are going to be huge holes to fill. In five to six years, we're really going to be struggling."
It is not these employees, he said, that could be replaced with robotics but only the tasks that are more menial. Even so, managers would still be necessary to oversee the robots as well as the operations in general. With one robot unit carrying a $100,000 price tag, Dinis said it's not the dairies that would benefit. Dinis said the Hispanic workforce is well-trained and thrive with technical tasks that are vital to each aspect of the dairy's operation.
The insulated nature of Colorado's dairy industry doesn't come without challenges. Similar to the beef industry, the dairy industry faces a barrage of fear-based marketing tactics that Dinis said appeal to consumers' fears.
"We're getting more purple all the time," he said. "Vegans are really coming to Colorado. Fort Collins has turned into Boulder and there's a lot more California-style politics migrating into Colorado."
The constant task of battling environmentalist agendas keeps Colorado dairymen on their proverbial toes and DFA has played a major role legislatively in that fight with the Colorado Livestock Association also playing a more significant role as well, he said.
The DFA has answered the call to assist member dairies in crises. When blizzards hit the Yuma area and DFA trucks were unable to reach the affected producer dairies, the cooperative paid for the dumped tanks of milk that couldn't be accessed. Another member dairy found themselves at the center of an undercover video scandal and the DFA came in to assist with the media, cleanup from flooding that occurred at the same time, and, he said, stood behind the producers.
"The dairy industry here is in great shape," he said. "We take care of each other." ❖
— Spencer Gabel is a freelance writer from Wiggins, Colo., where she and her family raise cattle and show goats. She can be reached at email@example.com or on Facebook at Rachel Spencer Media.