It’s been over two months since the 2017 Western Dairy Conference was held, but my brain is still thinking about something one speaker said: “Fifty percent of U.S. dairies will change ownership in the next 10 years.”
It shocked me at first, but the longer I thought about it, the more I agreed. If fact, 50 percent change every decade looks like it has been pretty normal for a long time – which says a lot about why so little in the dairy industry stays the same for very long.
The biggest part of the change, of course, comes from attrition. Since 2000, about 4 percent of all dairies have gone out of business each year. In the 10-year period that ended in 2016, the total decline amounted to 29.3 percent. In the 10-year period that ended in 2006 it was 34.7 percent.
The rest of the 50 percent is what I’ve been thinking about so much.
Parents handing the keys to the younger generation is a tradition . . . a hoped-for goal . . . in many dairy families. And when it happens, things the dairy does and how it does them naturally change.
With someone new in charge, new things start. Old things stop. Priorities shift up and down. Business relationships also change, because every person is different and has different ways of doing things.
I’ve met producers who said they had been making a mental list for years of things they wanted to change if they ever took over.
Things like milking more frequently or less, feeding or grouping cows differently, getting rid of bulls, increasing herd size or cutting it, raising calves or shipping them out, growing more forage or less, switching to freestalls, putting in cooling, getting rid of debt or taking on more, diversifying the business, maybe even changing breeds . . . or moving somewhere else.
Think back. Did you take over from a parent or relative? If so, what changes did you make? Everything didn’t stay exactly the same did it?
Farmers of all kinds are part of the huge Baby Boom generation; so many are now at, or close to, the retirement doorstep in some way. The continuing explosion in new technology, automation, and computerization has been daunting for many because it can represent drastic change. “I’ll let the kids deal with that when they take over” is something I hear often.
The question is, will they still be around to do it and will they be willing?
(c) Hoard's Dairyman Intel 2017