Charting Consolidation In The U.S. Dairy Industry

MegaMilk: Charting Consolidation in the U.S. Dairy Industry

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MegaMilk: Charting the Consolidation of the Dairy Industry

Today’s dairy industry looks very different to how it did just 30 years ago.

Milk production in the U.S. has increased by a whopping 50% over that time frame—yet, the total number of dairy farms has dropped by three-quarters.

Fewer and larger farms now have the lion’s share of all U.S milk cow inventory. While they have the ability to produce more competitively priced dairy products and provide more value to consumers, it is causing financial devastation for small farmers.

The graphic above uses data from the USDA to chart the rapid consolidation of the American dairy industry between 1992 and 2017.

The End of the Small Dairy Farmer?

In the U.S., the dairy industry is one of the fastest consolidating industries in comparison to almost all other agricultural sectors.

Between 1992 and 2017, small commercial farms with 10-99 cows saw an average decline of 70%. These farms accounted for 48.5% share of all U.S. milk cows in 1992. In 2017, that number stood at just 12.2%.

Over time, small farm production has been replaced by that of bigger and more consolidated “megafarms”—a move that can be attributed to the many benefits that scale brings, such as lower costs of production and the potential to compete in the international market.

  Share of U.S. milk cow inventory (by year)
Herd size 1992 1997 2002 2007 2012 2017
1-9 milk cows 0.9% 0.7% 0.6% 0.4% 0.4% 0.4%
10-49 milk cows 19.5% 13.8% 9.2% 6.8% 5.9% 3.6%
50-99 milk cows 29% 24.5% 19.1% 13.8% 11.1% 8.6%
100-199 milk cows 19% 18% 15.4% 12.8% 10.6% 9.4%
200-499 milk cows 13.7% 15.3% 14.7% 13.8% 12% 12%
500-999 milk cows 8% 10.2% 12.2% 12.5% 11.3% 10.7%
>999 milk cows 9.9% 17.5% 28.8% 39.9% 48.7% 55.2%
Total 100% 100% 100% 100% 100% 100%
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