By Nathan Phelps, Press-Gazette Media
OSHKOSH, Wis. – Vendors at the Wisconsin Public Service Farm Show say record milk prices last year were good for business, and some of that momentum is expected to carry into 2015.
The beginning of the year has seen milk prices retreat from the highs of 2014, but a number of Wisconsin agribusinesses say they remain optimistic about business prospects.
"Last year, with pretty good milk prices, we saw a significant amount of updates, improvements and a few new projects," said Dan Vander Heiden, a Kaukauna-based sales specialist with DeLaval. "A lot of that momentum seems to be carrying over into this year."
DeLaval specializes in providing milking systems.
Both farmers and agribusiness are subject to the cyclical swings of prices — crops or milk.
"When dairymen have money, they will spend it," Vander Heiden said Tuesday.
Several hundred vendors are at the three-day farm show on the Experimental Aircraft Association exhibition grounds as part of the 55-year-old event that runs through Thursday.
Pound-based Patz Corp. is seeing the sales trend from last year carry into the opening months of 2015.
"Last year was a very good year for equipment purchases," said Kevin Habeck, a district representative from Maribel. "This year we're expecting it to slow down some, but thus far it's been strong for the first quarter.
"We expected some carryover," he said.
Patz produces a range of farm equipment including vertical mixers, livestock belt feeders, manure handling equipment and conveyors.
Wisconsin milk prices were strong all of 2014, ranging between $20.80 per hundredweight in December to a high of $26.60 per hundredweight in September, according to figures from the National Agricultural Statistics Service.
In January 2015, prices dipped to $18.40 per hundredweight, the lowest since July 2012 when the price was at $17.80 per hundredweight.
Uncertainty remains over where milk prices will bottom out for the year. In a monthly analysis issued in February, University of Wisconsin dairy market expert Bob Cropp wrote the amount of milk produced this year may be less than forecast, which could help buoy prices.
But it's still early.
"Milk prices may turn out better than earlier forecast, and let's hope so," Cropp wrote. "But, milk production is currently running strong in the Northeast and the Midwest and several other states and spring flush is still ahead of us."
Corn and soybean prices also remain low with May futures trading around $3.72 per bushel for corn and $9.62 for soybeans.
Those commodity prices have cash crop and livestock farmers like Mike Dorshorst and Roger Branton of Poynette taking a reserved approach to major capital investments in 2015.
"We'll hope for next year being better," Dorshorst said. "Hopefully the fertilizer prices will come down … based on the sale price of your corn. Right now, it's high inputs and low income."
Many businesses have adapted to the cyclical nature of farm prices. Swiderski Equipment offers new and used farm equipment — including big-buck equipment like sprayers and tractors — at locations in Mosinee, Wausau, Thorp, Antigo and Waupaca.
"Even if some of the markets dip a bit, we still have product for the producers that need it. We can meet their needs no matter what their current situation is," said Melissa Heise, Swiderski's marketing and human resources director. "We're looking positively toward 2015."
Kurt Hieronimczak, vice president of DairyLand Structures in Seymour, said the business saw a bump in projects — barns, manure, feed slabs — last year, and there are projects that remain in the pipeline.
"Everybody was busy last year and I'm hoping (2015) is like last year," he said. "Maybe next year will be when things slow down."