The United States dairy industry has undergone a major transition during the past 20 years. Industry analysts and leaders view Iowa as having long-term dairy growth potential despite dairy plant closings and decreasing cow numbers in the short-term. However, continued decline in cow numbers will result in shrinking markets and services. Nationally, the dairy industry is in a growth period. The demand for milk is growing, with most of the growth in cheese. Production will need to grow by 1 to 2 percent annually to meet the demand. Iowa needs to increase milk production so processors can continue to be reliable suppliers of their product in the national market. Iowa has the resources and the infrastructure to take advantage of this opportunity.
Iowa State University (ISU) Extension began the Iowa New Farm Family Project in 2001 to actively grow and enhance Iowa’s dairy industry. This project’s goal is to improve Iowa’s farm economy and the state’s competitiveness. The project involves inviting Dutch farm families to become dairy farmers in Iowa communities. Dutch families have already begun settling in Northeast Iowa. Several of these families have visited the Dutchland Dairy in Rolfe and the Duitscher family initiated the first planning meeting in Pocahontas County. The local steering committee includes dairy and crop farmers, business people, elected officials, lenders, service groups, economic development staff and ISU Extension. ISU Extension staff has provided facilitation and education to build existing grassroots support for Dutch farm family resettlement.
The project will impact the economy of the county by bringing economic development to the county, offering jobs to our residents, and using local services such as veterinary, feed, trucking, hardware and repair, fuel, oil, electricity, labor, and professional services. Milk production and processing has a tremendous economic impact on local communities. The economic multiplier for milk production is 2.29 for every $1.00 in milk and associated livestock sales, another $1.29 is generated in economic growth. Only dairy processing, with a multiplier of 2.61, is higher. The average 72-cow Iowa dairy farm creates 1.52 jobs on the farm and 0.75 job off-farm. As operations grow in size due to the adoption of new technologies or the creation of multiple-generation businesses, job growth will increase proportionally.
Dutch farm families want to become United States and Iowa citizens and become fully integrated in the community, schools, churches, the dairy industry, and business community. These families seek a welcoming environment, profitable and competitive dairy business opportunities, and a good place to live and raise a family, all things that Iowa offers in abundance.
Dutch farmers are emigrating due to regulations in The Netherlands that limit herd size and the number of animals per hectare and reduce opportunity for inter-generational expansion. Iowa now has the opportunity to import educated and successful farm families and to grow the dairy industry to meet the needs of the major processing firms in the state.
Emigrating Dutch dairy farm families are not receiving any incentives or subsidies from the Dutch government, the U.S. government, the State of Iowa, the pilot communities, or private industry to relocate and settle in Iowa. Families who choose to emigrate are doing so on their own in the pursuit of a better life. In The Netherlands, these families will sell their milk quota, cows, personal property, and land. After paying 52 percent capital gains taxes, they will use the net along with borrowed capital to establish a new farm in their new country.
The Dutch families want to focus exclusively on milking enterprises of 150 to 500 cows situated on 40- to 80-acre parcels. These farms would be managed and operated by the owner with the majority of labor coming from the family or multiple generation families. The three pilot communities are working exclusively with farm families who want to pursue operations of this type. Feed and forage production agreements, in exchange for manure, would provide neighboring crop farmers with an increased net return per acre of nearly $30. Other spin-off opportunities for neighboring farmers include raising replacement heifers and dairy steers.
Nancy Jenson
County Extension Education Director
305 N. Main, PO Box 209
Pocahontas, IA 50574
712-335-3103 712-335-3104 FAX
Created on 05/24/2005 10:47 AM by MikeMajorowicz
Updated on 05/24/2005 10:56 AM by MikeMajorowicz
