SD dairy industry continues to grow, add economic value
GOODWIN, S.D. — South Dakota's dairy industry is growing rapidly, and the public is getting to see that for themselves during June Dairy Month open houses hosted by Ag United of South Dakota.
MoDak Dairy of Goodwin is just one of many dairy farms opening their doors to the public this month. Co-owner Greg Moes says they have been hosting people at the farm for many years and saw a record crowd at this year's event. "Now with livestock everybody wants to see everything that's going on with how we handle animals, how their food is produced," he says.
MoDak's 2,000-cow dairy operation is indicative of the growth in the state's dairy industry, which continues to see the largest monthly increases in milk production of any state.
Tracey Erickson, an extension dairy field specialist at South Dakota State University, says cow numbers have grown over the last decade from 80,000 at the low, to the current 120,000 head, which has resulted in more pounds of milk being produced. "The I-29 corridor has had positive growth for several years here and in fact has led the nation in its growth on a percentage basis for numerous years," she says.
The building herd can be attributed to the industry, as well as Governor Dennis Daugaard and the State of South Dakota recruiting new dairies from other states and overseas. In fact, Sonja and Frido Verpaalen relocated their dairy from the Netherlands to Volga, S.D., in part because of the friendly business climate in South Dakota.
They shared their story with non-ag consumers attending their June Dairy Month event at Old Tree Farms. "The United States doesn't have a milk quota. So, we could sell our milk quota in the Netherlands, get good money out of that and then just gain a lot of cows in a short time," says Sonja Verpaalen.
They started with 500 cows in 2001 and have grown to 1,400 today.
In addition, Moes says the positive trend is also tied to a strong milk processing infrastructure and current expansion in the I-29 corridor. The most recent examples are Agropur's plant in Lake Norden, S.D., and Valley Queen Cheese Factory in Milbank, S.D.
"We have two processors within 40 miles of us that are expanding ... So, I think that has really turned the tide for us in the Midwest," Moes says. "Right now, the processor is stepping to the plate. So, we have to bring some more milk in for them because they want it. If we were at 50 and 60 cow dairies here right now, we'd have trouble getting a processor coming and tripling their production."
He admits it has been a bit of a chicken and egg scenario, as just a few months ago, the state was facing a milk surplus and processors were turning milk away.
South Dakota dairy farmers are approaching this expansion in an environmental manner, as people also witnessed on the tour. "The number one thing is we try to be responsible. We live here too as farmers. We drink the water, we breathe the air, we consume the products," says Richard Vasgaard, president of Ag United.
According to Vasgaard, those dairy farms also bring significant economic value the state. He says these operations buy large amounts of feed, utilities and other supplies, plus rely on semen and vet services and truckers to haul milk. "We would like to see more dairy cows here. Agropur has expanded and they could use more cows," he says.
In fact, livestock production adds value to the state's grains and forage crops and that is positive for all sectors. "We export too much of our feed to other states so they can feed animals. It would be nice if we could keep them here and give us a little better basis for our product," Vasgaard says.
Livestock development also provides economic benefits to rural communities in the state. "Every dollar that you can spend gets turned around in the community and helps our local businesses and it's just a benefit all the way around," he says.