South Dakota is open to the dairy industry

Hoard's Dairyman: 

South Dakota is open to the dairy industry

Date: 
Thu, 02/23/2012

With few of its citizens more than one generation removed from the farm, South Dakota has an affinity for agriculture and is ready for dairy industry growth.

Governor Dennis Daugaard
Travel the I-29 corridor in eastern South Dakota and you will have found the heart of the state’s population. Intermingled along this same stretch of land are the vast majority of the state’s dairy cattle and processing facilities.

To help foster agricultural growth and dairy development within the state, South Dakota Governor Dennis Daugaard stopped by World Ag Expo, Tulare, Calif., on Wednesday, February 15.

“Our state currently has between 90,000 and 92,000 cows in the milking herd. We are looking to double this number in the next few years,” noted Daugaard. Within the last 12 years, milk production per cow has also blossomed, from 14,000 pounds per cow to its current level at 20,000 pounds per cow.

Processing plant fosters growth
Part of this growth was sparked when the announcement came from a large cheese manufacturer that plans to invest approximately $100 million to build a processing plant on a 48-acre parcel of land in Brookings, S.D.

This cheese plant will join two other large plants that call the I-29 corridor home. Currently, the other plants pull milk from Iowa and Minnesota to meet their processing needs; milk production within the state is unable to meet this demand. In 2011, the state produced 1.8 billion pounds of milk. The company’s investment will also bring another 400 jobs to the state.

To start, the new cheese plant will require 500,000 pounds of fluid milk per day. Additionally, the other plants use a combined volume of around 5 million pounds per day. From the producer’s perspective, these three plants foster a competitive market and a home for their milk.

Corn, alfalfa production strong
Corn is the state’s number one crop and contributes to South Dakota's expanding ethanol industry. “Between 2002 and 2010 we saw rapid growth in terms of both corn acres and yields. Corn production is rising at a rate that exceeds our current demand,” added Daugaard. Production exceeding demand is a plus for the burgeoning dairy industry; there is enough corn crop to go around, allowing producers to meet both cattle feed and fuel needs.

Lisa Richardson, executive director of the South Dakota Corn Growers Association has noted that current corn production hovers around 600 million bushels. With the improvements in crop genetics and tillage, it is anticipated that production will hit the 1 billion bushel mark sooner rather than later.

The state is also the largest producer of alfalfa and ranks in the top 10 for corn silage production, based on the USDA’s 2011 Crop Production Report. Due to its production rankings, South Dakota is able to maintain a low feed cost; averaging around $7.74 per hundredweight.

“South Dakota,” noted Governor Daugaard, “is open and ready for business.”

To find out more about the opportunities for dairy in this state, click here.