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Updated 11:00am - Nov 26, 2014

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TROUBLE ON THE FARM

Blake Alexandre stands on his dairy farm in Fort Dick. He keeps production up despite a struggling dairy industry. Photo by Stephen Corely/The Daily Triplicate ().
Blake Alexandre stands on his dairy farm in Fort Dick. He keeps production up despite a struggling dairy industry. Photo by Stephen Corely/The Daily Triplicate ().

Farmer able to increase production, but price cuts hurt progress

By Todd Wels

Triplicate staff writer

Blake Alexandres green rubber boots are slicked with mud and manure as he walks toward his barn.

The smell of hay and sawdust thickens the air.

In the distance, black and white cows dot the green grass, chomping away contentedly. A quiet chorus of moos can just be heard above the slow breeze.

Then, seemingly from another time, comes the electronic chime of Alexandres cell phone.

As he answers it, the image of the flannel-shirted country-boy farmer falls away, and he speaks the language of the professional commodities trader: weights, measures, dollars and cents.

Its a language he needs to know well. Despite the fact that his dairy has expanded considerably since it opened in 1992, producing more than half the milk in Del Norte County, hes losing money due to a nationwide slump in dairy prices.

Alexandre Dairy in Fort Dick produced approximately 40 million pounds of milk last year, totalling more than 58 percent of Del Norte Countys milk production, for a value of more than $5.8 million, according to the Del Norte County Department of Agricultures 1999 Crop and Livestock Report.

That was a big increase in production over the previous decade. In 1990, Del Norte County produced only 1.7 million pounds of milk. With the arrival of Alexandre Dairy in 1992, that number has steadily risen through 1999, when over 68 million pounds of milk were produced countywide.

Alexandre employs between 35 and 50 employees depending on the season.

Nearly 1,500 cows were milked by the dairys 52 milking machines last year.

Alexandre Dairy has expanded from 500 acres in 1992, to nearly 2,400 now.

But Alexandre has reason to worry that that might not always be the case.

The dairy industry isnt the cash cow it used to be.

Production is up, but prices are down, and the Alexandre Dairy is losing money.

Were struggling, big time, Alexandre said, adding that the dairy is losing between $1,000 and $2,000 each day.

Alexandre said a small percentage of over-production only 1.8 percent nationwide has resulted in record-low prices for dairy goods on the wholesale market.

Ironically, consumers are still paying last years higher prices, even though dairy owners are receiving less for their milk.

Unfortunately for Alexandre, his feed costs, which account for as much as 50 percent of his annual budget, remain at last years levels as well.

Its a vicious circle, in which the more he produces, he must also invest more, and will still receive less in return, he said.

Many business owners would respond to such adverse conditions by cutting back on both production and employment.

You cant just keep cutting back, Alexandre said. Our plans are to continue to grow.

Alexandre anticipates producing 8 million pounds more milk than last year, and is looking to expand even further.

Wed like to start a second dairy within the year ... in Smith River, he said.

In addition, Alexandre is considering entering into the organic milk market.

To market milk as organic, the cows producing it must be fed only naturally-fertilized grass or other feed, and not receive any antibiotics.

Unlike traditional dairy markets, which are dependent on Chicago commodity exchange prices, the organic market gives dairy producers a better ability to tap into the total retail price, Alexandre said.

The certification process for opening an organic dairy can last more than a year.

Alexandre is confident that his dairy will be able to weather the current economic storm for at least that long.

Were not going to go broke unless something catches us off guard, he said. This has by no means caught us off guard.

Still, when asked how long his business could remain open if the condition worsened, he replied: Not long.

Alexandre anticipates producing 8 million pounds more milk than last year, and is looking to expand even further.

Wed like to start a second dairy within the year ... in Smith River, he said.

In addition, Alexandre is considering entering into the organic milk market.

To market milk as organic, the cows producing it must be fed only naturally-fertilized grass or other feed, and not receive any antibiotics.

Unlike traditional dairy markets, which are dependent on Chicago commodity exchange prices, the organic market gives dairy producers a better ability to tap into the total retail price, Alexandre said.

The certification process for opening an organic dairy can last more than a year.

Alexandre is confident that his dairy will be able to weather the current economic storm for at least that long.

Were not going to go broke unless something catches us off guard, he said. This has by no means caught us off guard.

Still, when asked how long his business could remain open if the condition worsened, he replied: Not long.

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