Kraig Smith, 26, rents a 200-acre farm where he keeps 130 dairy cows, milking 65 of them.
I enjoy being around the cows, enjoy being in the fields. But, I’d say the last 12 months have been stressful.
— Dairy farmer Kraig Smith
Kraig William Smith
• Age: 26
• Home:Near Catlett
• Work:Dairy farmer, 2014-present
• Family:Parents, Kalvyn, 55, and Lisa, 51.
• Education: Virginia Tech, associate’s degree, agriculture technology, 2013; Liberty High School, 2011.
Working 14-hour days, the young Catlett dairyman barely scratches out a living.
Debt, overhead, depressed milk prices and other factors make it difficult for Kraig Smith, 26, to cover his expenses.
For starters, Mr. Smith pays $2,000 per month to rent a 200-acre farm along Bristersburg Road that includes a milking parlor, cow barn, machine shed and a modest, two-story home, which he occupies.
To bankroll the dairy in 2014, he borrowed $230,000 through the USDA Farm Service Agency’s “Beginner Farmer” program to buy about 35 cows, a corn planter, tractor and feeding equipment. Retiring the loan requires the Fauquier native to make monthly payments of $2,400 for the next 10 years.
With a herd of about 130 cows, he milks 65.
Five years ago, when Mr. Smith launched the dairy, milk sold for as much as $28 per 100 pounds, he recalled.
Today, it goes for about $17 per 100 pounds, which he called roughly “the break-even point” for him.
“When the milk prices tanked, we kind of dug ourselves in a little hole,” Mr. Smith said. “And, we need a little bit more than we’re getting now to get ourselves out of the hole.”
If prices reach $20 per 100 pounds, “we’ll be doing good,” he added.
For now, revenue from the sale of soybeans helps keep the dairy afloat, offsetting anemic milk prices, Mr. Smith said.
“That’s where most of the income comes from” to provide his cows feed, Mr. Smith said.
He declined to say how much he clears.
“It pays for me to live,” Mr. Smith said. “Right now, that’s about it. But, I’d say the last 12 months have been stressful.”
When milk prices last year plummeted to $12, he considered quitting the dairy business.
“Everybody else was,” said Mr. Smith, who estimated he has invested $500,000 to $600,000 in the operation. “I can’t blame them. I don’t blame anybody selling out, with these milk prices.”
A “combination” factors contribute to anemic milk prices, he said.
“There’s a little oversupply,” Mr. Smith explained. “Consumption of milk is down in general. There are new competitors (almond, oat and soy milk producers). And, the tariffs don’t help things.”
Transportation costs also have soared.
“Hauling our milk has doubled in the last three years,” from about 70 cents to $1.50 per 100 pounds, Mr. Smith said. “It’s been a big setback for us.”
Virginia dairy data paint a grim picture of the industry.
In 2006, the state had 782 dairies, producing 1.7 million pounds of milk, according to the Virginia Department of Agriculture and Consumer Services.
In January, Virginia had 510 dairy farms, producing 1.6 million pounds, VDACS reported. That represents about a 7.5 percent decline.
In the last eight months, the agency reported that 40 dairies have shut statewide, an average of more than one per week.
In 2006, Fauquier had about 26 dairies, according to Jimmy Messick, who milks about 230 cows at his farm near Midland. Today, the county has 16 dairies.
In 2006, county dairies produced 61,734 pounds of milk. In 2018, production totaled 40,170, tumbling 35 percent in a dozen years.
“This is not just happening in Virginia,” VDACS Communications Director Elaine Lidholm said. “It’s really a national kind of phenomenon” because of the simultaneous decline in prices and increase in production costs. “The farmers are a getting a double hit sort of at each end.”
A labor shortage also has placed additional “pressure” on some farms, Ms. Lidholm said.
“The only bright places we’re seeing are the farmers who are deciding the only way they can stay in the business is to either diversify or to add to their product,” she said. “Sometimes, they do both” to create new income streams.
Increasingly, they incorporate corn mazes, petting zoos and pumpkin patches into their farms, Ms. Lidholm said.
“That way they’re not putting everything into one bottle called dairy.”
Others, make ice cream and sell it through retail outlets, said Ms. Lidholm, citing Remington’s Moo-Thruas a model example of the practice.
“He’s sort of the one who started this trend” in Virginia, she said of Fauquier dairyman and Moo-Thru owner Ken Smith — no relation to Kraig.
Fauquier Agricultural Extension Agent Tim Mize described state of dairy farming as “very precarious.”
“It’s a very tight-margin operation,” Mr. Mize said. “Prices have been very bad, and so most farmers have been operating at a loss.”
Recent though small price increases may have improved farmers’ bottom line, he said.
But, the industry still faces significant challenges.
“It’s a lot of things,” he said. “Part of it is land availability. And, it’s not just having a place to put a (milking) parlor. You’ve got to grow crops. Pasture ground has become an issue.”
Increased traffic also poses problems because most Fauquier dairy farms “are pretty much located” in Southern Fauquier along the heavily travelled Route 28 corridor, Mr. Mize said.
“There’s a lot of pressure there that’s coming from urbanization.”
The Messick family has operated a dairy farm near Midland for 101 years.
Equipment, maintenance and labor costs can be “killers,” Mr. Messick said.
In more prosperous times, farmers could meet those obligations and still make a reasonable profit, he said.
“Back then — in 1980 — we were getting $17 (per 100 pounds of milk) and your largest tractor was $20,000 or $30,000,” Mr. Messick said. “Now your largest tractor costs $150,000, and the mechanic charges $100 an hour, not $15 an hour . . . . The numbers don’t work anymore.”
But, he believes dairy farmers can succeed if they carefully control spending.
“You’ve got to be sharp on it,” Mr. Messick said.
Mr. Smith, who has no paid labor, runs a tight ship.
His parents — Kalvyn, 55, and Lisa, 51 — and girlfriend, a Fauquier public school teacher, volunteer at the dairy farm.
“My parents are a huge help,” Mr. Smith said. “They’re here every day, and usually twice a day.”
He also makes do with two, 15-year-old pickup trucks.
“I don’t have the extra change to buy all this new equipment — not right now,” said Mr. Smith, smiling.
His family has deep agricultural roots in Fauquier. From the early 1950s to 2006, his grandfather, George Noland, operated a dairy at the 200-acre family farm along Old Dumfries Road just north of Catlett. Mr. Noland died in 2011 at age 74.
Mr. Smith’s parents keep about 30 head of beef cattle at the farm. A retired firefighter, Kalvyn Smith worked 32 years for Prince William County.
If all goes according to plan, Kraig Smith hopes to move his dairy to the family farm in about a year.
Because of his grandfather, Mr. Smith got an early taste of agriculture. And, through high school and during college breaks, he worked on other Fauquier farms. The experience made a big impression.
“It really just hit me,” he said. “I just enjoyed being around the cows every day. It’s a new challenge every day, a new challenge every crop year.”
Ultimately, Mr. Smith settled on dairy farming because, “I guess to try to follow in my grandfather’s footsteps, I reckon.”
Despite the industry’s numerous challenges, he remains optimistic.
“I do believe they’ll be a market for the milk before too long.”
Source: fauquiernow.com
