Vermont agriculture agency says dairy now a $5.4 billion sector, highlights processing growth and labor strain

Anson Tebbetts, secretary of the Vermont Agency of Agriculture, Food and Markets, presented a new report, Vermont Dairy Delivers, to the Vermont Senate Committee on Agriculture on April 25, saying the state’s dairy sector now contributes $5,400,000,000 to Vermont’s economy.

The report, Tebbetts told senators, traces a decade of change in Vermont’s dairy industry — rising processor numbers, increased exports and renewed focus on environmental practices — while flagging ongoing pressure from the federal pricing system, extreme weather and labor shortages.

Tebbetts said the report tracks a jump in dairy processors from 95 a decade ago to 158 in 2023, and cites national consumption at about 61 pounds of dairy per person in 2023. “Dairy does deliver,” Tebbetts said, summarizing the report’s central finding. He described growth in value-added products — cheese, butter, yogurt and ice cream — and said Vermont exports dairy products to Canada, Europe and Australia.

The nut graf: Committee members said the figures underline dairy’s economic role in rural communities and pressed on the practical obstacles farmers face. The agency reported the industry supports about 17,000 jobs and connects roughly $810,000,000 in wages and salaries to the local economy, while noting farm losses across the decade.

In discussion, Tebbetts and senators outlined several key constraints. Tebbetts attributed price volatility partly to the federal milk marketing order, which he described as month-to-month and sensitive to global supply and demand. He said that export reliance can create surplus and downward price pressure for Vermont producers. Committee members repeatedly raised the challenge of capturing a price premium for locally produced milk; one senator said efforts to charge “another nickel, another dime” for Vermont-made dairy had not been solved by the committee.

Tebbetts also described water-quality progress tied to new state environmental rules. He said farmers have adopted nutrient-management plans and infrastructure to store manure through winter months — noting restrictions on spreading manure during winter and a common required holding period from Dec. 15 through April 1 — and that these changes are contributing to improved water outcomes. A committee member said farmers are often blamed for lake phosphorus even when legacy sources or other factors are involved and praised farmers’ compliance efforts.

Labor was identified repeatedly as a top concern. Tebbetts estimated roughly 750–850 migrant workers are involved in the dairy industry and said many farms have turned to foreign labor programs; he described the visa rules as complex and often incompatible with year-round dairy work. Senators and Tebbetts discussed apprenticeships, the Dairy Business Innovation Center and other programs as ways to recruit and train new workers and successor farmers.

Committee members and the secretary addressed consolidation and scale: Vermont has fewer farms than decades ago, but larger average herd sizes. Tebbetts said about 10% of Vermont farms are dairy and that about 73% of dairy farms have fewer than 200 cows; only about 10% of the dairy industry operates at herd sizes over 700 cows. He warned that very large operations carry operational risks if labor or market conditions change suddenly.

The secretary and senators also discussed policy and market tools that could help producers expand markets — including supporting value-added processing — and noted infrastructure grants from state and federal sources for water-quality and compliance investments. Tebbetts said the state would circulate a booklet and online report to the committee and offered to provide follow-up materials.

The presentation closed with senators thanking the secretary and endorsing the committee’s focus on agriculture as a sector intertwined with land stewardship, tourism and rural community life. No formal committee action was taken on the report itself; members requested additional materials and discussion as the legislative session continues.

The report and booklet are available online from the Vermont Agency of Agriculture, Food and Markets, and the agency offered to distribute printed copies to committee members.