Dairy farmers across California are struggling to stay in business. They're having a cow over no rain because that means no hay for the cows that produce milk.

They need hay in order to make milk, which comes down to the livelihood for dairy farmers. It becomes a question of supply and demand down the road.

The alfalfa hay cows in Moss Landing are eating came all the way from Oregon. That's a full-day round trip for dairy farmer and Monterey County supervisor Lou Calcagno.

"You can imagine the cost by the time the hay gets here, close to $330 to $340 a ton, which is almost prohibitive, but you have to feed them. You can't let them starve," he said.

Calcagno runs about 1,000 cows and ships about 6,000 gallons of milk a day. But now this drought has increased the feed demand all over California, and the drought has killed the supply. In the 57 years he's been in the business, he's never seen it this bad.

"That water supply and being short is going to create major havoc on the dairy industry," he said.

Each of his cows eats about 20 pounds of hay every single day. It gives them proteins and nutrients that they need in order to produce quality milk.

While beef cattle farmers are selling their animals, it's not an option for Calcagno.

"It's pretty difficult for dairy," he said. "It would be very difficult for me to be out of business today and get back in a year from now."

Milk prices are already on a steady incline, and it could get worse. Now the cost could go up another 20 percent from a year and a half ago.

"I think we're looking at some of the highest milk prices that we've ever had. If we didn't get that for our product, there would be no way we can stay in business," he said.

California is one of the top dairy producing states because of the alfalfa that's grown in the Central Valley. Because the dry conditions are even worse out there, farmers can't look to them for help.