“In America, the big get bigger and the small go out,” said USDA Secretary Sonny Perdue when answering a reporter’s question at a press conference during the opening day of World Dairy Expo.
“I don’t think in America we, for any small business, we have a guaranteed income or guaranteed profitability,” he continued in answering the reporter’s follow-up question.
Those two lines sent the electronic universe into a frenzy when paired with the headline "Trump farm secretary: No guarantee small farms will survive."
Perdue’s complete answer
Having recorded the entire 55-minute town hall meeting and having reviewed responses to the media questions on October 1, 2019, the full context to the story is important.
Question: “We’ve seen the loss of a lot of small dairy farms in recent years. Do you think that the continued loss of small farms is inevitable or is there something that can stem the flow of that?”
Perdue response: “No, I think the 2018 Farm Bill will stem the flow of that. Now, what we see obviously is economy of scale having happened in America. Big get bigger and small go out, and that’s kind of what we’ve seen here.
“It’s very difficult on an economy of scale with the capital needs and all the environmental regulations and everything else today to survive milking 40, 50, 60, or even 100 cows. And that’s what we’ve seen.
“What we’ve seen is the number of dairy farmers go out, but the dairy cows haven’t reduced that much. Those cows have not gone to slaughter, they’ve gone to someone else’s herd, for the most part in that way. And that just increases the supply of milk, which makes the supply-demand balance even exacerbated in that way.
“But, again, I think more dairy farmers will be able to survive with the 2018 Farm Bill and its risk mitigation measures.”
Question: “But are they going to survive as they have in the past as small operations or are they going to have to get big or get out?”
Perdue response: “That remains to be seen. Everyone will have to make their own decisions economically whether they can survive.
“I don’t think in America we, for any small business, we have a guaranteed income or guaranteed profitability of survival. That depends on each and every farmer and dairy farmer.
“Farmers are pretty good at managing and managing through tough times. I think those that have survived through the ’14 Farm Bill should do well in the ’18 Farm Bill.”
That’s the complete manuscript
During the town hall meeting that started at 8 a.m. on the morning of October 1, Secretary Perdue and Wisconsin’s Department of Agriculture Trade and Consumer Protection Secretary Brad Pfaff shared the stage, and the two leaders answered a number of audience questions.
In the coming weeks of Hoard’s Dairyman Intel, we will share additional insight on supply management and trade mitigation payments on alfalfa.