WI Idea Spotlight shines on future of the dairy industry

Colleen Kottke
Wisconsin State Farmer
Over a year ago, the reality of the coronavirus pandemic settled across Wisconsin, impacting nearly every industry. The focus of this month's Wisconsin Idea Spotlight centered on the future of the dairy industry – especially in the wake of the pandemic.

Over a year ago, the reality of the coronavirus pandemic settled across Wisconsin, impacting nearly every industry.

The focus of this month's Wisconsin Idea Spotlight centered on the future of the dairy industry – especially in the wake of the pandemic. The virtual event on March 25, hosted by the Wisconsin Alumni Association, featured an online panel discussion with dairy farmer Mitch Breunig, Mark Stephenson, director of dairy policy analysis at UW–Madison and Kent Weigel, professor and chair of the Department of Animal and Dairy Sciences at UW–Madison. The discussion was moderated by Katie Hepler, Wisconsin Alumni Association advisory board member and marketing director at Dairy Farmers of Wisconsin.

Impact on the farm

Mitch Breunig, owner of Mystic Valley Dairy that produces milk for Grande Cheese, says his farm's initial response to the pandemic was to keep workers on his dairy safe and healthy.

Mitch Breunig, owner of Mystic Valley Dairy that produces milk for Grande Cheese, says their milk market was lost overnight when the pandemic shut down restaurants and the food service industry.

"We kidded that dairy farming is the ultimate job for socially distancing anyway," he said.

But as the restaurants and institutions started to shut down on the East Coast, the shockwaves hit the dairy industry hard and fast, especially for farms like Breunig's who produced cheese for that segment of the food service industry.

"Overnight our milk market was lost," Breunig said. "Our (milk processor's) orders were cancelled and they had no outlet for our milk. We got a call saying we had to cut back on our milk production by 20% and we had seven days to figure it out."

RELATED: Farm families cope through hard times of pandemic

Breunig says it was a huge shock. To meet the new production quotas, Breunig said they were forced to dump milk and relocate some of their milking herd to other farms.

"It was the first time in my life as a farmer that we've ever had to dump milk," he said. "It was a horrible, horrible week."

But in a matter of weeks, Breunig said the cheese plant changed its processing protocols and began making a different product.

"Literally in just 60 days everything was turning around," he marveled.

Impact on the supply chain

Mark Stephenson says the change in Americans' eating habits during the pandemic contributed to the stress on the supply chain.

"We normally eat about half of our food and dairy products away from home. So when we lost institutional food service like schools and restaurants, that whole supply chain for dairy products was disrupted," Stephenson said. "It was a complete pivot from people eating in restaurants to people eating at home."

Mark Stephenson

And for farmers sending milk to cheese plants providing product to a retail chain, the fallout wasn't as harsh as those producing for plants furnishing products to the food service industry where product is often shipped in large containers.

"Those plants shut down overnight. People thought 'how hard can it be to just take stuff from restaurants and put it in grocery stores?' But we don't buy 15-pound bags of shredded cheese for our refrigerators. We want it in 1-pound or 8-ounce packages," he said. "Luckily the industry reconfigured itself very quickly as we began to narrow product lines."

RELATED: Milk production increase outstripping supply gains

But as the industry was trying to retool the supply line, cows kept producing milk back on the farm.

"Farmers had to either ratchet back the intensity of rations, dry cows off early or maybe cull some cows in the herd in an effort to slow down production," Stephenson said. "And that was all done."

Impact on education

Kent Weigel says the pandemic also hit the university hard. In a matter of days in mid-March, university officials made the decision to cancel face-to-face instruction to prevent the spread of the virus among their students, staff, and faculty. 

Kent Weigel

"In a span of a couple of days we lost our entire student labor force when they were sent home. So on a couple of days notice, we closed the campus dairy cattle center, sold about 70-80 cows to reduce production and inventory," Weigel said. "We also shut down the research enterprise for about 6-8 weeks."

While students were learning on-line, Weigel says the Extension also sought to deliver education to farmers across the state via an online format.

Moving forward

As Wisconsin strives to move forward out of the pandemic, Weigel says the University of Wisconsin continues to be on the forefront of innovation including making progress on the Dairy Innovation Hub.

RELATED: Dairy Innovation Hub: Three UW schools roll up sleeves to launch Hub activities

The Dairy Innovation Hub, which received $8.8 million in funding from the 2019-20 state biennial budget, harnesses research and development at UW–Madison, UW–Platteville and UW–River Falls campuses to keep Wisconsin’s $45.6 billion dairy community at the global forefront in producing nutritious dairy products in an economically, environmentally and socially sustainable manner.

The hub has four key priority areas: stewarding land and water resources; enriching human health and nutrition; ensuring animal health and welfare and growing farm businesses and communities.

"With the initiative approved, we've been implementing this largely during the pandemic," Weigel said. "We have a lot of people engaged in projects who weren't interested in dairy before – in other fields like entomology, engineering and so forth – involved in collaborative projects with us and the other colleges of agriculture in advancing technology and science for dairy farming and the dairy industry."

Weigel says they've been able to "bring in a lot of new talent" at UW Madison including a rumen microbiologist, dairy economists, soils and ag engineers.

"(Our research focus) spans the whole gamut from traditional fields like genetics, reproduction and nutrition that was kind of the bread and butter of any dairy or animal science program in the past. And now we're in new areas with the new hires we've had including animal welfare specialists, others from fields such as genomics, animal biologics and microbiome studies," Weigel said.

Moving technology ahead

Keeping the future of the dairy industry strong will involve adopting new technologies to keep its farms viable and efficient.

Stephenson says Wisconsin dairy farmers have been embracing new technology for the past 100 years. 

Keeping the future of the dairy industry strong will involve adopting new technology to keep its farms viable.

"But that's dependent on having an unending stream of new technologies coming to them. And that's what the Dairy Innovation Hub is all about: heaps of new management practices; new technologies, new seeds, new crops and new genetics being there for the dairy industry in its quest to find greater efficiencies," Stephenson said.

Technology will also play a key role in product innovation. While many smaller cheese plants have found success in the niche market of producing specialty cheeses, Stephenson says there's an opportunity to look at exporting outside of Wisconsin and the U.S. that don't produce as much in the way of dairy products.

However, there may be challenges not only in getting that product overseas, but in satisfying the unique demands of international customers.

While the U.S. produces a good amount of mozzarella, Stephenson says we haven't been as successful as other competing countries including the European Union or New Zealand.

"It was difficult because we were meeting them with prices but they weren't receptive to the product," he said. "They weren't used to the white mozzarella cheese made here in the United States."

Stephenson says it's important for producers to understand what the customer wants.

"It's easy enough for us to tweak these cheeses and products to make something that consumers in other countries are used to. So there's a lot of innovation that can take place from the university here to help up move this product all the way through."