Dairy farming was once Harford County's biggest industry, home to hundreds of farms whose owners and members of their extended families milked tens of thousands of cows twice a day, seven days a week, 365 days a year.
But that was generations ago. In 2011, dairy doesn't even rank as Harford's top agricultural business in terms of revenue or land use. Recent animal census figures show the county has more cattle being raised for beef than for milk.
Farm Fair Week in Harford County is usually about celebrating our agricultural heritage; however, the long, slow decline of the local dairy industry is a reminder that all the efforts that have gone into preserving this heritage haven't always succeeded.
Dan Vaughan, who has run Daily Crisis Farm in White Hall for the past 30 years, said the future of dairy is uncertain because the federal government continues to put so many requirements on farmers.
"It's steadily on the decline still," he said about the local dairy industry.
Harford County was down to fewer than 25 working dairy herds last year whose owners sent milk pooled through dairy cooperatives to processors, according to an annual regional milk marketing report released last month.
The report, published by the U.S. Department of Agriculture's Northeast Milk Marking Region, said 42 million pounds of milk were sent to processors from Harford County last year from 21 local producers.
Based on the report's average annual price in the region of $16.92 for 100 pounds of milk, the 2010 production comes out to about $7.1 million in gross value, about a third of what it was 20 years ago.
Much of the bulk milk produced in Harford goes to cooperatives and is in turn pooled and sold to processors. Nationally, cooperatives handle about 65 percent of the bulk milk produced on farms, though the percentage is higher on the East Coast. In some major producing states in the West, particularly California and Idaho, where individual herd sizes are often 10 or 20 times larger than herds on the East Coast and in the Upper Midwest, producers have the ability to deal directly with processors.
Herbie Harkins, of Harkins Hill Farm in Forest Hill, said a number of factors are hurting the dairy industry, with development pressures being a big one.
About dairy's future in Harford, Harkins said: "I hope there is one. If they don't look out for the dairy farmers a little more than they have been for the last 10 years, nobody's going to be here."
National issues
The dairy industry nationally was in particularly bad straits in 2009, when the price of milk plummeted to just over $14 per 100 pounds of milk used for bottling, a casualty of too much supply and not enough demand.
There may have been other market forces at work, however, which has prompted Congress to take a closer look at the complicated and somewhat archaic federal milk pricing system, amid allegations that one or two large national processors depressed prices through their high volume buying.
Though prices rebounded in 2010 and have held higher over the first half of this year, the dairy industry is also being hit hard by higher production costs for fuel, electricity and fertilizer — all sensitive to the price of petroleum.
"The prices they are getting now are incredible, but it's so cyclical," C. John Sullivan III, Harford County government's deputy chief of staff for agriculture, said Friday. "I don't know how you can plan a budget when in one year's time you might lose 50 percent [of revenue]."
Sullivan said local dairy farmers who also produce enough grain and hay to feed their herds "are doing good." Those who don't and have to buy it "are struggling."
Little versus big
Sullivan puts the typical herd size in Harford County at 100 to 150 milk cows. Very few exceed 200 and a 250-cow herd is rare. By contrast, in California, the nation's top producing milk state where there are more than 1.7 million cows, compared to just 55,000 in Maryland (2,400 in Harford, according to the Maryland Department of Agriculture), individual herds of 1,000 to 2,000 cows are the norm.
"Our farmers can't compete with the big dairies," Sullivan said, noting that it's impossible to achieve economies of scale California size because land in Maryland is too expensive and feed production and labor costs are higher. Though the milking process has become highly automated, cows can't take care of or milk themselves, and most operations locally have historically been family farms, which by necessity restricts the size of their milk herds.
Harkins said it's already hard to survive on the small amount of money farmers make, and competition from larger farms doesn't make it easier.
"They have just about killed us," he said. "The big corporate farms have pretty much chased out the little dairy farms."
He said his farm once had about 200 cows. It's down to 50.
Environmental issues
Even 100 milk cows and their calves — cows have to calve each year to continue producing — create enough manure to pose an environmental and economic challenge for local dairy farmers.
"Nutrient management regulations are hot topics," Sullivan said.
Vaughan, of Last Chance Farm, said he is using minimal amounts of fertilizer and herbicide, and cutting back on the amount of protein concentrate used to try to meet regulations and save money.
"The [U.S. Environmental Protection Agency] is our biggest enemy right now. They have no idea how to run a farm," he said.
Harkins cited traffic concerns and growing development as major factors negatively affecting local farmers, although the price of oil is also an issue, since everything used on the farm depends on petroleum.
"It's hard to farm in this area," he said. "It has a little bit to do with everything. We have a lot of neighborhoods in the county, not that all of us aren't to blame for selling a few lots here and there … It's hard not to, when you are trying to pay bills and put kids through college."
Ways to adapt
On the plus side, Harford does sit in the midst of a huge population where demand for milk has historically exceeded what is produced in the region. Proximity to that large market via I-95 helps somewhat, Sullivan said, though not enough to outweigh the more negative economic variables.
Sullivan said only a few Harford dairy herd owners are trying to get bigger, but more are considering direct sales for all or some of their milk. The most successful practitioner of the latter, he noted, is the Dallam family, of Broom's Bloom Dairy, off Route 543, where they sell ice cream and artisan cheeses made with their milk, as well as other locally produced dairy and meat products.
Sullivan said Broom's Bloom owner Kate Dallam, a member of the county's agricultural advisory board, has encouraged other dairy operators to diversify into on-farm direct sales.
He also said he recently led a group of local farmers on a tour of a dairy in Cecil County which is bottling its own milk for direct sale to the public.
"It's a huge investment in equipment," he said, "and that doesn't even count dealing with the various health department regulations."
Complex pricing
Dairy farmers in Harford have historically said if their costs of production and keeping up burgeoning environmental regulations don't fell them, the way milk is priced also tends to work against a smaller operator.
Milk prices are set through a complicated formula regulated by the federal government that takes into account factors such as butterfat and protein content, supply and demand and use by processors. The prices are regulated across marketing regions, so when processors buy milk, they pay a guaranteed minimum price to the farmer.
The prices are further determined by the use of the milk, so processors pay more for milk that is bottled for drinking, known as Class I milk, than they pay for milk used in so-called soft products such as ice cream and yogurt, known as Class II milk. They pay less for milk used in cheese production, Class III milk. There is also a class of milk used for nonfat dry milk and butter, Class IV. Prices in classes II, III and IV are further broken down by 3.5 percent butterfat content and skim.
Regional milk prices are set monthly. According to the latest Northeast Marking Area monthly report, Class I milk was priced at $23.77 per 100 pounds for June, Class II (3.5 percent) at $21.27, Class III at $19.11 and Class IV at $21.05.
The industry standard for weight of a gallon of whole milk is 8.6 pounds, so for every gallon of milk a farmer sells for bottling, he or she will receive $2.04 back less deductions for cooperative assessments. The same milk will sell for a third higher in a retail store.
"We can't say, 'We are not going to sell our milk for that.'" Harkins notes. "We belong to a co-op and the government sets our price, and we don't really have anything to say about it,"
Proud heritage
As recently as 50 years ago, dairy farming was still among Harford County's biggest industries and its largest agricultural enterprise in terms of gross receipts.
Even 25 years ago, despite the suburbanization of much of the southern half of the county over the previous quarter century, Harford still had 120 working dairy farms.
In 1986, the federal government tried to address an oversupply of milk nationally and the subsequent plummeting prices for producers by buying up whole individual dairy herds through a bid and offer program.
Harford lost about a sixth of its herds through what was called the federal whole herd buyout. The number of local herds has dropped steadily in the intervening years.
Dairy farmers face numerous challenges. Despite mechanization that revolutionized the industry in the first half of the 20th century, dairy farming is still a labor-intensive enterprise.
Herd health requires constant attention, and cows have to be milked twice a day, seven days a week. There are all kinds of economic challenges involved, and many Harford County families that have remained in farming for generations have switched away from dairy to either beef cattle or crop farming because of the uncertainty involved in running a dairy herd.
"You don't see many younger people getting into the business," Sullivan, of the county government, said. "We did have one younger person start a herd in the last few years, which is encouraging."
Sullivan also said owners of most of the major dairy farms have placed their land in agricultural preservation, so they are committed for the long haul.
Looking ahead
Vaughan is one who is not especially concerned about competition for his products. He has consistently kept 70 dairy cows on the 150-acre farm over the years.
"We are going to try to stay in business," he said. "Two of my children are coming back to the farm, but with the constant government regulations and government intervention, it's hard to know where the end is going to be."
Harkins said he would be happy just to survive.
"We would just like to be able to pay our bills and get from one year to the next," he said, explaining there is not much he can do to change the operation.
His son-in-law, Dave Thomas, said the farm he recently married into might have to continue changing, which is what many younger farmers are doing, regardless of what their families concentrated on producing in the past.
"If you don't diversify, it's not going to survive," Thomas said. "There's too much volatility as far as milk price, petroleum. Your input versus your output is too volatile."