Prices Sour, Local Dairy Struggles to Stay Afloat

By Camaron Abundes   
NewsWest 9

HOBBS, NEW MEXICO - It's a long way from Wall Street but the same factors driving the global financial crisis are sending the dairy business into a tailspin. Dairy Farmers like Gerard Doldersum and Heather Bill are facing unprecedented losses according to the United States Department of Agriculture (USDA).

"Every cow that leaves the milk barn is losing money," Doldersum said.

Bill and Doldersum started Landmark Dairy in Hobbs, New Mexico just over a year ago, but already they've watched market highs and lows one would expect to see in a lifetime.

"I am afraid that if it lasts too long then the banks will back out and a lot of dairymen will have serious trouble," Doldersum said.

At Landmark, layoffs are relatively small, the staff went from seven people to just five people.

"It's just like any business." Heather Bill, Co-owner of Landmark said, "Everyone is making cuts."

Recession or no recession, farming is a gamble, but the U.S.D.A. reported back in December of 2008 prices have fallen by 60 percent in the last year. The melamine milk scare in Asia, increased supply worldwide, and the financial melt down are all factors weighing down the market.

"All the fertilizer was based on last years fuel cost," Doldersum said. "The prices are so low and the costs are so high we're losing a lot of money."

Bill is now handling jobs they would normally contract out.

Dairy Farmers of America called the loses in 2009 unprecedented. They've setup a 24-hour support Hotline for members and say the group says it's working to balance the supply with the demand.

"We are always dependent on banks and as we all know they're in a crisis too," Doldersum said.

Normally, Doldersum expects to make about 30 cents on milk sold to consumers but with today's price of feed and production expenses he's losing thousands each day.

"The dairy industry is in somewhat of a collapse." Bill says she hopes it turns around soon.

Still at Landmark, the couple is optimistic because they only have 600 cows, Doldersum says he is more worried about friends with larger dairies down the road.

"You here stories about how people are having trouble paying the bills. We're really in big trouble right now," Doldersum said.