The price of milk is dropping to record low levels. While this may be good news for consumers, it could be threatening the future of many farmers.
Peckhaven's Dairy Farm in Saratoga Springs is just one local dairy facility hit hard by the slumping global economy and drop in demand for milk.
Farmer David Peckhaven has about one hundred cows and produces thousands of gallons of milk per year, yet he says he may not even break even if prices continue to plunge.
“A year ago [milk prices] were really high, they've steadily gone down since, and combine that with the high price of fuel this summer, and it really put a pinch on us and now we're hitting record low prices,
Either you survive or you don't. You can't reduce the number of animals because of your overhead costs. So you have to be as efficient as you can and not buy anything you can live without,” Peckhaven told NEWS10.
Peckhaven predicts as many as 2,000 people will lose their farming jobs this year because of low milk prices.
It is interesting to note that New York is the third largest dairy state in the country, with hundreds of farmers struggling to stay in business.
NEWS10 spoke with New York State Agriculture Commissioner Patrick Hooker, who says farmers are essentially taking a 40% salary cut.
“Farmers are currently paying double, for their feed, their inputs, various commodities they are using to feed cows,” Hooker said, “so not only are they taking a 40% cut, their costs are doubling. It is a price cost squeeze like we have never seen in the dairy industry,”
The commissioner says that although there is no quick fix to this problem, Governor David Paterson is reaching out to the Federal Secretary of Agriculture for assistance.