Naerebout Encouraged About Future of Idaho Dairy

Things are looking much better for the Idaho dairy industry.  Rick Naerebout, CEO of the Idaho Dairymen’s Association said this is especially welcomed news, considering producers have been dealing with negative margins for 18-24 months.  He noted that milk prices have rebounded to the point where dairy producers have returned to profitability.  And he noted it looks like the good news will stick around for a while.

“We've got a good demand equation right now and then you also have constrained supply.  Like the beef industry, we have a very short heifer crop and so replacement animals are not plentiful. And so that is. That's putting a bit of a crimp on the milk supply, and then you know that's going to persist forward. It takes 2 years to get a heifer ready to be a milk cow.”

Naerebout added this is most likely not a short-term supply constraint. He acknowledged that producers should be able to slightly increase production in the next year, the reality is until the dairy industry has the animals, very little will change.  The industry’s consistency is another reason Naerebout is optimistic about the future.

“Growth for us really, it's not huge percentage growth, we typically grow about 1% per year," Naerebout said.  "If you looked at the last five to eight years, that's what our trend is, about a percentage of growth a year.  But in terms of volume, that's about a half –a-million pounds of milk a day. We've got a processing industry that's growing right along with us. And so we feel very, very good about the prospects for Idaho’s dairy industry. And us continuing to be the pillar of the Ag economy that we've been the last two decades.”

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