Dairy farmers in the US are facing increasingly difficult business conditions and finding it hard to sustain operations due to rising costs and falling prices.

The business condition for dairy farmers in South Dakota have become very difficult following the fall in prices of milk during the recession of 2008-2009 at a time when the costs for livestock feed increased in the country. This has made it difficult for the firmest to sustain operations and they have been losing earnings.

The high prices of feed had eroded a very large part of the earnings from operations in the previous and the situation is expected to be the same this year. Due to the drought like situation in some parts of the country, the price of feed is expected to rise further. Experts say that the federal dairy program is designed to provide a safety net to the farmers but it has not been able to help the farmers in that goal. The policy was designed decades when the economy was very different and the exports were non-existent.

The mechanism includes support prices and this may not solve problems as even as prices og milk remain high, the farmers would lose large chunk of earnings to high costs of feed and other materials. Experts said that there is a need reo revive the support structure of the government for the dairy farmers.