As goes dairy, so goes business Written By Michelle Monroe Thursday, October 08, 2009 Product, service suppliers worry about future ENOSBURG FALLS — Area businesses that provide services and products to local dairy farmers are in a unique position to see the economic effect of the current farm crisis. Two local business owners say that times truly are tough.     “If you lose 10 farms in an area, you lose a business,” said Tim Bates, owner of Bates Farm & Garden in Enosburg Falls.     According to the most recent figures from the U.S.D.A. the cost of producing 100 pounds of milk in Vermont in August was $24.79. The cost in New England to produce it: $12.27. The June figures are the most recent available.     “It’s the first time I can remember when farmers milking 50 to 100 cows are doing better than farmers milking 500 or 1,000 cows,” Bates said.     Farmers lose money with every hundredweight they produce, but still need the income, Bates explained. “They’ve got to make milk. It doesn’t matter what they get paid for that milk.”     Farmers are surviving by borrowing against the equity in their farms, but the value of cows has dropped $300 to $500 each, according to Bates, dramatically reducing the farm equity.     Real estate prices are also down, reducing the value of farmland.     Farmers who have borrowed heavily against their equity to expand are in the toughest spot, according to Kent Henderson of Northwest Veterinary Associates in St. Albans. Many of those farmers are in the west and southeast, Henderson said.     Henderson was critical of banks and what he called an “unnecessary delay in how long it takes to process the loans.” Banks, Henderson pointed out, were given a bailout.     Veterinarians across the country are seeing a decline in the demand for services, Henderson said. Farmers are being more conservative about treatment, he said. Henderson has been using lower costs generic medications to treat animals, something he doesn’t like doing.     "All of the infrastructure, all of the support businesses are feeling a similar pinch,” Henderson said.     About half of Bates’ business is agriculture. “The ag side of our business is off substantially,” Bates said.     Farmers are buying just what they need for their daily operations, putting off repairs and improvements to equipment and infrastructure, he said. “Guys aren’t repairing stuff. They’re praying to the good Lord that things don’t break,” Bates said.     Many farmers have loan and other payments deducted from their milk checks, the checks they receive from the processor or cooperative for their milk. “All of the sudden there’s a large number of producers who aren’t receiving a milk check,” Bates said, as the money farmers are receiving for their milk isn’t enough to cover the deductions.     “They’re having to start selling assets to pay the bills,” Bates said.     Half of Bates’ 12 employees are allocated to the agriculture side of the business. Bates pointed to other Enosburg area businesses dependent on farming from trucking services to cheese manufacturers to gas stations and car dealerships.     “If we get rid of all the farms in this area, I guarantee half of the people in Enosburg would get laid off,” Bates said.     “If something isn’t done soon, it’s going to be too late,” Bates said.     Henderson agreed. "The dairy industry won't come back and that's the real danger here," he said, pointing to the loss of safe, local food. The dairy industry is vital to Vermont, he added. "I don't know what we're going to replace it with if it goes."

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