A number of wake-up calls in the 1990s caused leaders in the Badger State to step up and take action. As a result, Wisconsin's stalled production began to take off.

by Hoard's Dairyman staff

Wisconsin dairy industryThe word renaissance means rebirth or revival. The revolution in Wisconsin dairying began in 1872 when the state's farmers began transforming from wheat production to dairy and shipped cheese to East Coast markets for the first time. Then, in less than four decades, Wisconsin rapidly grew milk production and overtook New York to become the nation's leading dairy state. While that was the revolution, Wisconsin is now experiencing a renaissance where dairy producers and processors alike are reinvesting in America's Dairyland.

That hasn't always been the case, as there was a time period after the revolution in which everyone just assumed Wisconsin's dairy industry would remain vibrant. As was the case, a number of converging forces have caused state leaders from government, industry and the farm gate alike to take their eye off Wisconsin's prized "golden" economic egg. Perhaps California passing Wisconsin for milk production in late 1993 was the loudest wake-up call that got Badgerland dairy leaders leading again. Once that happened, Wisconsin's stalled milk production began taking off.

In our minds, there are a number of projects that caused Wisconsin's dairy renaissance. We singled out 10 key projects that supported its recent resurgence. We will start with the top three because they are perhaps the largest contributors.

1. Wisconsin became reacquainted with its strengths. America's Dairyland was born for a reason. Wisconsin has a climate suited for cows, and it has water. Timely rainfalls make Wisconsin ideal for growing forages. Go to the Western and Southwestern U.S., which is presently experiencing a devastating drought, and the first word to come out of farmers' mouths is WATER. "Where will we get it today?" is among the most asked questions.

2. A reawakened dairy infrastructure. While California still produces more milk, Wisconsin is dairy's Silicon Valley, and it serves as one of the world's elite research hubs. The Badger State has three four-year colleges turning out dairy grads, plus nearly a dozen two-year programs.

Wisconsin has more international dairy-related businesses, more dairy farms and more dairy plants than any other state. Plus, state and national elected officials care about dairy due to its economic impact. The latter isn't the case in most other states.

3. Modernized the Western dairy model. Using all the natural resources and other tools within the state, dairy farmers adapted the Western model. In doing so, Badger State dairy farmers added a land base and their crop production prowess to the Western dairy model. That land-based amendment, splashed with water, cash flowed many producers during corn's recent record prices. As a result, the Badger State is once again cost-competitive with the entire country.

To validate this factor's high ranking . . . Nearly two decades ago, before Wisconsinization of the Western model took place, one had to drive two hours to see a freestall barn. Today? Ten minutes, at the most, in major dairy areas.

In creating the remaining seven action items, our analysis left off a number of very important grant programs over the past decade. These five state-sponsored initiatives provided seed money to investigate dairy-related business ventures that took root because of the top 10 factors detailed in this article. In leaving them off, we chose to focus on forces that remained long after the seed money dried up.

4. Use value assessment for farmland. The Wisconsin Farm Bureau and the Cooperative Network worked with Wisconsin's legislature to tax land based on its use, not its development potential. The law took effect in 1995 and was fully implemented in 2000. It reconfirmed Wisconsin's commitment to agriculture and kept acres in ag-based activities by not taxing farmers off the land.

The law has worked extremely well. Prior to its implementation, 60,000 acres were being converted each year to nonfarm use. In 2004, land conversion fell to 44,000 acres; 15,200 acres in 2007; and 4,300 in 2012. Wisconsin farm families are saving $400 million in property taxes for a total of $4 billion since 2000.

5. State investment tax credit. Many agricultural groups worked with the state's elected officials to encourage investment in its aging infrastructure. Those tax credits were passed in 2004 and began the next year for farms and for manufacturing plants in 2007. Those credits will bear fruit for years to come, as an updated infrastructure will make Wisconsin cost-competitive with the country and the world.

6. CDR and WMMB. Dairy product research has been at the heart of bringing value-added dairy products to the market. Cheese is the nation's leading dairy product, and Wisconsin makes the most of it in the nation. It also has done a remarkable job branding it with help from groups such as the Wisconsin Milk Marketing Board (WMMB). That cheese output made whey research a natural fit at the Center for Dairy Research (CDR) as 100 pounds of milk yields 10 pounds of cheese and 90 pounds of whey.

7. PDPW and DBA. There's power in numbers, and these groups focus exclusively on dairy. The Professional Dairy Producers of Wisconsin (PDPW) got its start in 1994; the Dairy Business Association (DBA) in 2001. Both groups brought like-minded people together to get excited about and grow the dairy industry.

8. Livestock siting law. Unique synergies came together to bring about a law that gave predictability to the siting process, and dairy farm expansion ensued in May 2006. While many groups deserve praise for its passage, there is no doubt that DBA led a unique coalition in the capitol rotunda to make it become a reality.

9. Dairy farm choice. If you want to dairy farm, you can do it about any way you want in Wisconsin. The Badger State is home to the most organic dairy farms. Tie stalls, freestalls, bedded packs, robotics and grazers; you name it, and Wisconsin has it. All are welcome and flourish.

10. Rebirth of the little cheese factory. Value-added has benefited Europe for centuries, why not Wisconsin? Innovation in dairy product research helped Wisconsin move past the commodity market model, and today the state produces 600 varieties of cheese.

From our vantage point, these 10 key elements helped Wisconsin recapture the dairy momentum it once had, fostering a positive business climate for dairy. This grassroots, bipartisan effort proves it's far easier to assist already established businesses than to invest countless dollars with hopes that a new venture will someday gain economic traction.

Wisconsin milk cow trend

This article appears on page 721 of the November 2014 issue of Hoard's Dairyman.