Vermont Icons

WHITINGHAM, Vermont, July 31: At his 138-year-old farm above Vermont's Lake Whitingham, Leon Corse lifts bales of fresh green hay off a flat-bed truck to feed his cattle and hopes to sustain a dying New England tradition.

''Forty years ago there were maybe 15 farms in this town, while there are now three,'' said Corse, a lean 52-year-old with a disarming smile and greying moustache who is grappling with New England's worst farming crisis since the Great Depression.

Rising fuel costs, a 30-year low in wholesale milk prices and fierce competition from bigger farms in California, New Mexico and other western states are squeezing family-run dairy farms at the heart of New England's rural image.

Driving rain that ruined 52 million dollars in Vermont crops in May and June led the federal government last month to declare the state a disaster zone, making farmers eligible for low-interest loans and putting them in a national spotlight.

At stake, economists and farmers say, is the bucolic image of old New England that is framed by farms like the 400-acre (160-hectare) spread owned by the Corse family for five generations, where Leon's great-grandfather churned some of America's first commercially produced butter.

''Any one of these problems they could probably weather. When you get all them you are really questioning whether some of the farms will be even able to survive the coming year,'' said Bob Parsons, economist at University of Vermont.

Vermont, the region's top dairy producer, has seen 43 dairy farms shut this year alone. That leaves 1,192 farms in the state -- compared to 11,019 in 1950 and 2,047 in 1995. On average, Vermont loses 3 per cent of its farms a year.

Farmers in Maine, Connecticut, Massachusetts and Rhode Island are also losing money, auctioning off heifers and selling parcels of land. Three of New England's six states have issued emergency aid to farmers.

''Huge numbers of farms are going out of business,'' said Doug DiMento of Agri-Mark, a cooperative of New England dairy farmers. ''Many of the farmers are old, and when there is no money being made, the kids don't want to get on the farm.

''What's going to happen is the farms are going to run down like they have been, you are barely going to be able to pay your taxes like they have been, and the farm is going to go into bankruptcy when the owners leave,'' he said.

VERMONT ICONS

No state depends on cows quite like Vermont. The official state seal includes an image of a cow. ''MOOver'' buses painted in a Holstein motif shuttle tourists around. Premium ice cream makers ''Ben&Jerry's'' was founded in a renovated gas station in Burlington, Vermont.

By sheer economics, the pain is also acute. Although Vermont produces just 1 per cent of the nation's dairy products, dairy makes up 80 percent of the state's agricultural sector, its fifth-biggest economic industry.

Like Vermont's blazing autumn foliage and tapping of maple syrup in early spring, cows grazing on its farms with red barns are an iconic image and a magnet for tourists.

''Vermont is a state that has the greatest dependency on a single commodity than any other state,'' said Parsons at the University of Vermont. ''We have all our eggs in one basket.'' Dairy farmers nationally face similar problems. US milk consumption has dwindled from a peak in 1945 with the slide accelerating in the past 30 years.

Surging fuel costs have pushed up the price of fertilizer and feed, the biggest expense on farms. Milk prices have crumbled below 12 per dollar hundredweight, a key threshold in production costs and compared with about 14 dollar last year.

Farmers are milking more cows to pay their bills, knocking supply and demand further off balance.

WESTERN GROWTH

But while farms in New England are shutting or stagnating, those in California, Texas and New Mexico are growing, fuelled by cheaper labour, warmer climates and less expensive feed.

Vermont Governor Jim Douglas announced a nearly 9 million dollar aid package to farmers last month and is pressing the Bush administration to end opposition to a 4 billion dollar farm bailout package. ''What we really need is Uncle Sam to help us out,'' Douglas told Reuters in an interview.

On the Corse farm in Whitingham, a village of 1,298 people settled by seven British soldiers in 1770, Leon says he wonders whether his three children will carry on the work that keeps him busy from 0400 hrs until sunset seven days a week.

They struggle with the decision and know it would be a sacrifice, he says. Belt-tightening has meant no Corse family vacation in five years. There was no money for luxuries like a television, or a snowmobile in winter or a boat for summer -- amenities common to rural Vermont.

To survive, Corse's farm is going organic, a costly process that takes up to three years but opens up a premium market where supply is failing to match demand. He reckons he'll earn 2.40 dollar a gallon for organic milk -- doubling his money.

''I was quite convinced that there was no way this farm could survive for 50 years as a conventional milk farm. I think it might be a possibility in organic,'' he said.

REUTERS