Fort Wayne bottling startup delayed, How Walmart may shape dairy landscape

By Sherry Bunting, edited from Farmshine and Farmers Exchange May 18, 2018

GreatValueMilk(WalmartPhoto).jpgFORT WAYNE, Ind. — Bottling at Walmart’s first-of-its-kind milk plant in Fort Wayne, Indiana will be delayed.

“We’ll begin bottling later this summer and will kick in to full production later this year,” notes Walmart spokesperson Molly Blakeman in an email response.

Until then, she said, “we have a plan in place to ensure there are no disruptions in the supply chain for customers.”

Described earlier as a 250,000 square-foot plant to bottle Great Value and Member’s Mark milk for 600 Walmart and Sam’s Club stores, Blakeman confirmed: “Once it becomes operational and once fully utilized, it will be one of the largest fluid milk plants in the U.S.”

Processing capacity was not disclosed, but Blakeman did discuss milk sourcing.

“By operating our own plant and working directly with the dairy supply chain in the Midwest, we will further reduce our operating costs and pass these savings on to our customers, so they can save money,” she related.

“We are working with three milk cooperatives and a number of independent farmers. Each farm that is supplying milk to our facility is within 180 miles of the plant,” noted Blakeman, explaining that farms terminated by Dean Foods that are “closer to Fort Wayne have signed contracts with the cooperatives to work with Walmart.”

She indicated the plant will serve stores “throughout most of Indiana, Michigan, Ohio and parts of Illinois and Kentucky.”

Beyond that, she confirmed: “Dean Foods remains a very large fluid milk supplier to many (Walmart) stores.”

When questioned about reports that Walmart is already eyeing sites for future plants, Blakeman said they want to be successful with this plant before seeing if other opportunities exist.

“Walmart’s goal is to produce the highest quality and freshest-tasting fluid white milk and chocolate milk possible — and deliver a great value on that purchase,” Blakeman stated.

Meanwhile, the milk price wars among supermarkets, discounters and big box stores have reached new lows of 67 cents per gallon in states without loss-leader protection — including Indiana, Kentucky, Michigan, Ohio and Illinois, the states to be served by the new Walmart plant.

Does Walmart accept these below-cost retail milk prices as a cost of customer acquisition and loyalty?

Blakeman cited the Federal Milk Marketing Orders (FMMO): “Any loss Walmart takes on milk cannot be passed on to the producer because of how our milk payments are regulated by the FMMO. We, as a non-coop processor, have a minimum milk price that is set by the government that we have to pay our producers and cooperatives.”

Furthermore, noted Blakeman, “Walmart will not do well in this plant if our dairy producers do not do well. We will provide a dedicated market for their milk, so they can focus on milk quality and animal care.”

She notes that Walmart understands the role of quality.

“We have strict policies in place in regard to animal welfare,” Blakeman explained, noting full support for the National Dairy Farmers Assuring Responsible Management (FARM) program initiated by National Milk Producers Federation, a milk cooperative membership organization, and Dairy Management Inc., an organization funded by the mandatory milk promotion checkoff.

At a link provided by Blakeman (https://corporate.walmart.com/policies), Walmart states that it is “committed to continuous improvement and aspires to achieve the globally-recognized Five Freedoms of animal welfare for farm animals in our supply chain.”

When asked how Walmart’s milk-sourcing addresses consumer desires for locally-produced milk, Blakeman put the focus on the plant.

“The farms and coops we are sourcing from are local and family-owned producers,” she said. “Milk being supplied to our plant comes from no further than 180 miles away.”

Walmart also seeks to work with single-source loads instead of commingled farm milk, and their efforts to work more directly with the milk supply chain go beyond the area served by the Fort Wayne plant.

A number of reports have surfaced among industry sources that some of Walmart’s milk-source will make its way to Dean Foods’ plants in Pennsylvania that bottle a mix of in- and out-of-state milk and where Walmart’s Pennsylvania milk dealer license is associated.

“The sourcing strategy in Pennsylvania remains unchanged since the Fort Wayne plant is not supplying any of our stores in Pennsylvania,” said Blakeman when asked about this potential development. She declined to address questions about the milk sourcing strategy further east.

In 2013, Walmart acquired a Pennsylvania milk dealer license from the Pennsylvania Milk Marketing Board listed for six fluid milk bottling plants owned by Dean Foods — one in New Jersey and five in Pennsylvania — including plants that cut half of their dairy farm suppliers, 42 in Pennsylvania, four in Ohio and one in New York.

In Pennsylvania, the 80-year-old milk marketing law authorizes the Pennsylvania Milk Marketing Board (PMMB) to set retail and wholesale milk prices at levels to cover retailer and processor cost-recovery plus a profit margin.

The PMMB also sets a producer-over-order premium that is only followed back to the farm level on milk that meets three criteria — produced and bottled in Pennsylvania and sold to stores or warehouses within Pennsylvania’s borders.

That premium was reduced from $1.60 per hundredweight of milk to 75 cents in January due to pressure from out-of-state milk sourcing that allows retailers and processors to keep the producer premiums.

Tennessee has a loss-leader law for milk. While not as robust or lawyered-up as Pennsylvania’s complex system, the provision keeps retail milk prices from going too low.

In addition, Pennsylvania has a state logo (PA Preferred) plants can apply for, and if qualified, use the logo to signify the milk was produced on farms in Pennsylvania. Efforts are underway in Tennessee to see if something like this can be achieved, and the state already has bottlers doing local marketing.

Producers who received Dean letters in Pennsylvania and Tennessee were largely able to find new milk contracts with bottlers that source and advertise their milk using local marketing strategies, but even in those states, some of the affected farms ultimately had to sell their cows.

While a few farms in each affected state sold cows and exited the dairy business, most who found markets, found them with smaller bottlers or smaller cooperatives. However, 14 in central Kentucky, 7 in southern Indiana , 1 in Tennessee, 2 in Ohio and 1 in western New York, have not. (Update since publication: Dean Foods did give a 30 day extension until July 1 to the Kentucky producers and a select few in southern Indiana whose contract renewal dates differed.)

As reported previously, of the 25 Indiana farms facing Dean contract terminations on May 31, those in northern Indiana have largely been resolved with offers from two cooperatives — Michigan Milk Producers and Great Lakes Milk Producers — while the southern Indiana farms are having more difficulty, according to Doug Leman, executive director of Indiana Dairy Producers.

“We have had contacts with some of the affected Indiana farms and are looking for opportunities for them,” said Doug Brechler for Great Lakes Milk Producers. “Like the affected farms, we are still making decisions. We can only take the milk we have a market for.”

Brechler confirmed that Great Lakes Milk Producers is one of several entities that will be supplying the Fort Wayne Walmart plant. “We’re thankful to be one of the suppliers and look forward to working with Walmart and happy to be a part of providing them with high quality milk and service.”

Brechler and Leman see the new Walmart plant as an opportunity for milk producers in the Mideast milk marketing area even though the current situation in milk markets is difficult at this time.

The farms in Kentucky, southern Indiana, Ohio and western Pennsylvania having trouble finding new milk buyers are on the southern and eastern ends of the area to be served by the new Walmart plant and on the fringes of the Southeast and Northeast regions that are considered milk-deficit. (Update since publication, some of the remaining western Pennsylvania farms were picked up by Schneider’s Dairy, a PA Preferred milk bottler, that has taken on at least 8 of the 16 western Pennsylvania producers dropped by Dean).

These eastern deficit regions were noted recently by University of Wisconsin dairy economist Dr. Mark Stephenson in a “changing dairy landscapes” presentation at the Heartland Dairy Expo in Springfield, Missouri. Stephenson said getting milk from surplus regions to deficit regions is a “tricky challenge.”

Most of the farms still seeking new milk buyers are not large enough to be “single-source-loads,” and they are outside of the 180-mile sourcing distance for the Fort Wayne Walmart plant. Yet the Walmart store brand in their area will be supplied by the new plant instead of the regional Dean plants these farms had long supplied.

According to state officials and Federal Order reports, there are other processors operating in the region, and supplemental milk is regularly brought in from outside the area to serve their needs.

In Kentucky, for example, two cooperatives operating across a wider region are the gatekeepers to these plants, and they have previously indicated they will not accept new members.

Maury Cox, executive director of the Kentucky Dairy Development Council is concerned that losing the 14 Kentucky farms could damage the dairy infrastructure and unravel the state’s significant dairy industry.

“It’s down to the wire and we’re working on a hail-Mary,” says Cox. “We started with 19 affected producers, and we’re down to 14. Some have exited the business and we may lose a couple more.”

He says the KDDC, Kentucky Department of Agriculture and the Governor’s Office of Ag Policy have all gotten involved helping these farms find a solution before their last pickup.

Both Leman and Cox share the concern that if the southern Indiana and central Kentucky farms are lost, other farms in the region — both independent and cooperative – will be more vulnerable in terms of future milk markets and transportation costs.

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Pa. Gov. Wolf names Barley to PMMB, Senate confirmation hearings in June

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By Sherry Bunting from Farmshine, May 25, 2018

HARRISBURG, Pa. — The Pennsylvania State Senate will take up consideration and confirmation of two new appointments from Governor Tom Wolf for the Pennsylvania Milk Marketing Board (PMMB)

The Governor’s appointment of Lancaster County farmer and dairy producer Rob Barley of Conestoga and education technology consultant Carol Hardbarger, Ph.D., require confirmation by the state Senate.

That process is anticipated for June and begins with a Senate hearing via the Senate Ag Committee, which could be scheduled as early as June 6.

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Rob Barley

While the Pennsylvania Milk Marketing Law does not specify two “farmer” representatives and one “consumer” representative, the familiar practice over the years is for the 3-member board to be comprised in this manner. Rob Barley has been nominated by the Governor, pending confirmation by the Senate, to fill the expired “farmer” seat of PMMB chairman Luke Brubaker, also a Lancaster County dairy producer.

According to the Milk Marketing Board website, Brubaker was first appointed by Gov. Tom Ridge in 1997 and re-appointed by Governors Ed Rendell and Tom Corbett. Brubaker’s third term expired in 2016.

“I am supporting Rob Barley’s nomination and think he will do a great job in this position, given the current challenges for dairy today,” said Senator Scott Martin of Lancaster in a phone interview Monday. “Even thought Rob comes from a larger dairy farm, I have already heard from many smaller farms who support his nomination because they see that Rob understands their plight.”

The PMMB completed the second of two listening sessions last week on ideas presented by the Pennsylvania Department of Agriculture through a petition by Ag Secretary Russell Redding as well as ideas presented by the public.

The dairy farming community has brought concerns over the past 10 to 15 years about the transparency of the PMMB over-order premium and other regulatory and statutory aspects of the Milk Marketing Law, as well as questions about the modern-day impact of this unique system not found in other states at a time when milk moves coast to coast and around the world.

“This (appointment) is just one step in us looking at the dairy issue and how it impacts our communities and our local farmers,” said Sen. Martin. “We can’t continue to allow expired positions to go as long as it has in this case. We need to show that we care about these issues, and get this confirmation done.”

Martin notes he is “glad the Governor nominated these individuals for the farmer and consumer representation. We need to get them confirmed and move forward to address the dairy issues.”

Barley operates Star Rock Farms, a diversified dairy, livestock and cropping enterprise, with his brother Tom and cousin Abe. They were recognized as 2017 Mid-Atlantic Master Farmers. Among other involvements, Barley has served on the board of the Lancaster County Ag Council and the township planning commission. He has also served as president of the Dairy Policy Action Coalition and has testified in past years before both the Senate and House Ag Committees when various bills were considered to address transparency in the PMMB pricing system.

If confirmed by the Senate, Barley would fill the expired seat of Luke Brubaker, who has served on the Milk Marketing Board for 21 years, including the past nine as chairman.

Dr. Hardbarger, an education technology consultant, earned her degrees in agriculture and education at Penn State University. She is a former assistant professor at Cornell and has applied her specialized skills to various positions in public and private education with interest in technology and resource utilization, professional development, and grant and proposal writing.

If confirmed by the Senate, Hardbarger would fill the expired board seat of Lynda Bowman, a Lancaster resident who was appointed by Governor Tom Corbett in 2011. She previously served as secretary of the PMMB and is a past president and lifetime member of the International Association of Milk Control Agencies.

The third member of the board unaffected by these appointments is Jim Van Blarcom, a farmer and dairy producer from Columbia Cross Roads, Bradford County. He was appointed by Gov. Tom Corbett in June of 2014.

To support the Governor’s appointments to the PMMB, contact your state Senator. Also contact the Senate Ag Committee chairman Elder Vogel at 717.787.3076 and Senate President Joe Scarnati at 717.787.7084 by June 6. To locate your state Senator, use this guide

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Start your engines… the milk’s a’chillin’

By Sherry Bunting, May 25, 2018

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Photo credit ADAI

INDIANAPOLIS, Ind. — Just as those Indy Cars are fueled to perfection for 500 miles at blistering speeds of 215 to 225 mph, that famed Bottle of Milk fuels the checkered-flag dreams of winners at the finish line of the Indy 500.

It’s the honor of the Milk People (aka dairy farmers) to get it there.

While I didn’t meet this year’s Indy 500 Milk Woman — I did meet her husband and children during a visit to the farm last March while passing through Northern Indiana.

Kim Minich, Triple M Dairy, LaPorte, was the rookie last year when Milk Man Joe Kelsay, Kelsay Farms, Whiteland, had the honor of delivering the “coolest trophy in sports.” This year, Kim is the veteran, and her rookie understudy is Andrew Kuehnert, Fort Wayne. They all hail from six and seven generation Indiana dairy farms.

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Photo credit ADAI

Last year, as the ‘rookie,’ Kim learned the ropes for this year’s 102nd big race at the Indianapolis Motor Speedway, where legends are born, speed and tradition rule, and milk always wins!

During my brief March visit to Triple M Dairy where Kim and her husband Luke are part of the dairy farm that has been in his family since 1909, their children Anna, Kate, Mary, Will and Calvin were looking forward to May. They talked of how exciting it was to see Mom’s rookie year as Milk Woman in 2017 … How it felt like the dairy farmers were celebrities like the Indy car drivers — two long and storied traditions brought together when three-time Indy 500 winner Louis Meyer requested buttermilk to quench his thirst after his second win in 1933.

Indy500-4137According to American Dairy Association Indiana (ADAI), Meyer was then photographed in Victory Lane drinking milk after his third win in 1936. Milk was presented off and on during the next several years until, in 1956, the Bottle of Milk was made a permanent part of the post-race celebration by Indianapolis Motor Speedway owner Anton “Tony” Hulman.

Today, the milk choices of the drivers are kept cold in a secure “Winners Drink Milk” cooler.

The drivers are polled ahead of time on their milk preferences — whole milk (3.5%), 2%, 1% or fat-free, and the cooler is stocked with these choices, so the ‘milk people’ are ready.

For this year’s race, 17 drivers chose the whole milk option, 10 chose 2%, 4 chose fat-free and 2 said any milk was fine with them!

Hoosier driver Ed Carpenter chose to up the ante with a request for the throw-back choice of Louis Meyers: Buttermilk. That could be a lucky move as he is considered a strong contender going into the race scoring a pole position.

Tomorrow, as always, the milk will be kept under lock and key in a secret location with one of the Milk People keeping a watchful eye at all times. This year, in fact, the Milk People will be the first to enter the Indianapolis Motor Speedway grounds at 5 a.m., Winners Drink Milk cooler in tow.

Minich5414wRecalling her mom’s rookie year in 2017, Anna says “they looked like the secret service in sunglasses guarding the milk cooler!”

In 2016, the 100th running ended with a milk toast by spectators. The children wonder what milk drama will unfold this year.

“The bottle of milk is the star,” says Kim’s husband Luke. “When they start making their way toward the winner’s circle with that cooler, and you hear the crowd chanting ‘It’s the milk,’ as a dairy farmer, that’s pretty cool.”

Each year the ADAI selects a dairy producer to represent Indiana’s 1100 dairy farms as the Milk Man or Milk Woman.

People flocking through the gates want to talk to the Milk People (aka dairy farmers), and for weeks ahead of the big day, they have opportunities to tell the story of milk and dairy farming. They even co-host the Fastest Rookie Luncheon earlier in the week.

Kim married into dairy farming, and in one pre-race-day interview, she explained how she grew up in the Indianapolis suburbs and would watch the Indy time trials with her father.

Minich5418wToday in her career as a nurse-practitioner, Kim says she has a big appreciation for the milk-side of the big race and appreciates the opportunity to tell others about the nutritional goodness of milk and dairy products as well as the life their family lives — like other dairy farm families across the country — caring for the animals and the land.

The children are passionate about the farm too. They have a growing array of 4-H projects that make your head spin: Cattle, chickens, rabbits, goats, horses. In fact, while the dairy farm is home to 1000 mainly Holstein milk cows, Luke and Kim’s older children each have a few of their own breed — Anna with Jerseys, Kate with Brown Swiss, Mary with Shorthorns, and Will with Ayrshires. They love their chores and are happy to show visitors, like me, around.

“This is a great way to raise a family and produce a quality product for other families to enjoy,” says Luke on a brisk March day at the farm.

His wife Kim could not agree more, saying in pre-race interviews that being part of the dairy farm “has been absolutely wonderful, and as a nurse practitioner, I’m able to talk to my patients about the importance of dairy.”

As for her job tomorrow as the provider of the Indy 500 Bottle of Milk, “It’s a great honor to do this,” says Kim. “It’s exciting to meet the drivers and to represent our dairy farmers and what we do.”

web2016WinnersDrinkMilk-46As the sun rises tomorrow, drivers and crews will be getting ready, spectators will be pumped, our nation’s service men and and women will be honored, anthems will be sung and tributes given… and after 500 miles of exhilarating speed, the winner drinks milk!

So chill your milk, and get ready. The thrill of the 102nd Indy 500 is hours away.

Here’s a video teaser from the 100th Indy 500! Wait for it… The powerful and patriotic blend of freedom and speed that ensues after the recognition of our military, the moment of silence for fallen heroes, the singing of America the Beautiful, the National Anthem followed by the Blue Angels flyover, the singing of Back Home in Indiana, the anticipated “Gentlemen Start Your Engines”, the breaking free of the pace cars as the field of Indy cars passes the paddock with Old Glory in tow!

 

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Global dairy thoughts Part II: Who’s being creative?

Part Two of Six-part “Global Dairy Thoughts” Series in Farmshine

wGDC18-Day1-56By Sherry Bunting, from Farmshine May 4, 2018

BROWNSTOWN, Pa. — Everywhere we turn, we receive the message that fresh fluid milk is a market of the past and exports of less perishable dairy products are the wave of the future. As discussed in Part One of this ‘global dairy thoughts’ series, that seems to be the trend if you look at the markets.

Yet, could a portion of the reason we are in this fluid milk decline, be the effect of USDA-regulated pricing, USDA-imposed restraints on the ability to promote competitively in the beverage space, and the resulting industry neglect of this regulated commodity category — fresh fluid milk?

The government — USDA — and the checkoff and cooperative leadership have no appetite for significant change to any of these factors. USDA gets to pay less than it otherwise might for milk in its nutrition assistance programs, while both the proprietary and cooperative processors get to pay less than they might otherwise for components in a range of products.

Meanwhile, dairy farms see the first product to come from their herds — milk — declining, and their futures along with it.

Yes. We all know it. Fresh fluid milk — the most nutritious and natural option — is in the fight of its life. In meeting after meeting, presentation after presentation, we hear the messages from the industry and university economists — both subtly and outright.

Like this: “The fluid milk market is the dead horse we need to stop beating.”

Or this: “Do we want to hitch our wagon to a falling rock?”

And so forth, and so on.

It is difficult to question the industry and its economists on anything to do with the Eastern U.S. or the fluid milk market. Some have gone so far as to say that if the East is relying on fluid milk, they are out of luck.

Meanwhile, dairy farmers in eastern regions suggest that if fluid milk does not stabilize its losses or restore its market share — at least partially — they see their value as producers vanishing.

And in fact, this has an impact on our global advantage — that being the U.S. having a large consumer base at home to anchor the base production while growth is said to be the reason why we need exports.

As mentioned briefly in Part One, the Federal Orders are designed to move the milk from surplus regions to deficit regions, and that is what the proposed USDA change in Orders 5 and 7 will do further, the experts say.

Meanwhile, who is being creative to figure out how the deficit regions of the East can use or regain their primary competitive advantage — having a base of consumers within a day’s drive. This line of thinking is analogous to how the U.S. fits as an exporting nation with quite a large consumer base at home.

What really requires our creativity is the U.S. product mix and how milk resources are priced and sourced.

Here are some numbers. U.S. dairy protein disappearance has had average annual growth of 6.3% over the past five years, though it has been a bumpy ride, with U.S. production of milk protein concentrate (less exports) at its lowest levels over that five-year period in 2014.

Meanwhile, demand for fat is increasing as consumers heed the dietary revelations and switch from lowfat and fat-free milk to whole milk and have their butter without guilt.

Mentioned last week in part one is that global milk production increases are beyond the stable rate of 1.5% per year. According to the U.S. Dairy Export Council (USDEC), the combined growth rate from the EU-28, U.S., New Zealand, Australia and Argentina was double that collective 1.5% threshold. Looking at 2018, however, reports are surfacing to show spring flush is delayed in Europe just as it appears to be in the U.S.

Or is global production reining in? The markets are trying to figure that out with quite a rally going in powder right now.

One thing rarely mentioned in these reports is that Canada’s production has also grown with increased quota to account for the greater demand they see in their domestic market for dairy fat.

In fact, despite its supply management system, government figures show Canada’s milk production had year-over-year growth between 3 and 6% for each of the past three years, and 2018 production is off to a 5% start.

In Canada, as in the U.S., fat fortunes have changed over the past four years, so the belt has been loosened to serve that market, leaving more skim swimming around.

Canada’s new export class (Class 7) mainly pertains to this excess skim, which has reduced the amount of ultrafiltered milk they now buy from U.S. processors.

In addition, as pointed out by Calvin Covington in his presentation at the Georgia Dairy Conference in January, milk can be purchased at lower prices for this Canadian export Class 7 because the excess skim is used in products that are then exported.

This means the resulting products in the Canadian export class can be sold at globally competitive prices. While not in huge volumes, some of this product is going to Mexico.

This brings us to Mexico — currently the largest buyer of U.S.-produced nonfat dry milk, making the outcome of NAFTA negotiations a sticky issue for industry leaders, especially as Mexico recently signed a trade deal with the EU to include dairy.

The two forks come together in regions like the Northeast, where Class IV utilization has become an increasing part of the blend price and a more important balancer of the shrinking Class I.

While March showed a surprising jump in Class III utilization to a 15-year high in the Northeast, the overall trend over the past four years has been a blend price with increasing Class IV utilization and decreases in Classes I, II and III.

Dairy economists indicate the U.S. is making more world-standard skim milk powder for export, but in reality, the U.S. still makes a high percentage of nonfat dry milk (NFDM), which is still the largest domestically-produced milk powder category and it is the only milk powder that is used in the Federal Order pricing formulas.

NFDM is primarily made in conjunction with butter. As butter demand has grown and prompted greater butter production in the U.S. over the past four years, more NFDM has been made and stored (or the skim is dumped) as a result.

The market issue in the U.S. has been compounded by the EU having a mountain of intervention powder stocks in storage, some of it aging.

After the European Commission sold over 24 metric tons two weeks ago, global and domestic powder markets moved higher. It was the largest chunk to come out of that mountain to-date and was offered at reduced prices to attract buyers. But by the time the bidding was done, it sold at or above the GDT price for SMP powder.

It’s really true. Inventory depresses prices. Having a big chunk of a huge inventory gone, is, well, big.

The flip side of the coin is that European processors have shifted from powder production with their excess to making more cheese and butter.

Next in Part Three, we will look specifically at some differences between the products made in the U.S. vs. what is traded globally, and at the differences between the U.S. and global trading platforms.

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PHOTO CAPTION

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While attending the 2018 Georgia Dairy Conference in January, a large global cargo ship on the Savannah River, passed by the glass windows at lunchtime on its way out to sea. Several dairy producers walked outside for a closer look, we all hoped there was plenty of powder on board. Photo by Sherry Bunting

Global dairy thoughts Part I: Whirlpool of change. Who’s minding the store?

Part One of Six-part “Global Dairy Thoughts” Series in Farmshine

By Sherry Bunting, from Farmshine, April 27, 2018

BROWNSTOWN, Pa. — Even though U.S. per-capita milk consumption is in decline, consumption of other dairy products is strong. As the industry devotes resources to new milk markets abroad and puts the fluid milk market here at home on commodity autopilot: Who’s minding the store?

While it is true that the U.S. dairy market is ‘mature’ — not offering the growth-curve found in emerging export markets — the U.S. consumer market is still considered the largest, most well-established and coveted destination for dairy products and ingredients in the world.

As U.S. milk production continues to increase despite entering a fourth straight year of low prices and market losses, industry leaders look to exports for new demand that can match the trajectory of new milk.

The U.S. has already joined the ranks of major dairy exporting nations, and the U.S. Dairy Export Council (USDEC) has set a goal to increase exports from the current 15% (milk equiv) to 20%. Keep in mind that as our percentage of exports increases while our milk production also increases, the volume of export markets required to meet this goal is compounded.

On one path at this fork in the road is the mature domestic market with its sagging fluid milk sector that is increasingly filled in deficit regions by transportation of milk from rapidly growing surplus regions.

This dilemma of getting milk that is increasingly produced away from consumers packaged and moved toward consumers was cited as a “tricky challenge” by Dr. Mark Stephenson, Director of Dairy Markets and Policy at the University of Wisconsin-Madison, in his presentation on Changing Dairy Landscapes: Regional Perspectives at the Heartland Dairy Expo in Springfield, Missouri earlier this year. In this presentation, Stephenson pegged the Northeast milk deficit at 8 bil lbs and the Southeast deficit at 41 bil lbs. (More on this in a future part of this series).

On the other path at this fork in the road is the industry’s desire to expand exports within a global market that needs a 1.5% year-over-year global production increase. But, as the USDEC reported in its February global dairy outlook, global milk output is growing by twice that rate, mainly from gains in Europe.

Meanwhile, U.S. regulatory pricing structures are based on milk utilization. As the total dairy processing pie grows larger, the neglected fluid milk sector becomes a shrinking piece of the expanding pie, and income is further diminished for dairy farms.

The emerging export markets are rooted in the demographic of rising middle-class populations improving diets with dairy. And yet, just because these new markets offer new growth curves for new milk production, the anchor for this ship is still the U.S. market, still No. 1 as the largest dairy consumer sector globally, and still moving milk via Federal Order pricing that hinges on that shrinking piece of the expanding pie: Class I.

What are the obstacles to improving this sagging fluid milk sector? How are regulated promotion and pricing constraining restoration of declining fluid milk sales?

Over the past three years, two prominent and longstanding milk bottlers in the New York / New Jersey metropolis have either closed their plants (Elmhurst in New York City), or sold their dairy assets (Cumberland Dairy in New Jersey sold to DFA). Amazingly, the former owners of both plants are expanding into the alternative beverage space — adding new plant-based beverages to the proliferation of fraudulent ‘milks’ that already litter the supermarket dairy case.

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While dairy milk sales decline, plant-based beverages are a growth market, though the pace of growth has slowed.

At the Georgia Dairy Conference in January, Rob Fox, Dairy Sector Manager of Wells Fargo’s Food and Agribusiness Industry Advisors, talked about big picturedairy trends, and he showed graphically the way these alternatives are eating into the U.S. dairy milk market. While dairy milk sales decline, the plant-based beverages are a growth market, though the pace of growth has slowed. (See Chart 1)

Fox also showed a pie chart of combined supermarket sales of dairy and plant beverages at $17 bil., with dairy accounting for $15.6 bil. and plant-based at $1.4 bil. (Chart 2).

GlobalThoughts(Chart2)

Rob Fox showed a pie chart of combined supermarket sales of dairy and plant beverages at $17 bil with dairy accounting for $15.6 bil. and plant-based at $1.4 bil.

Doing the math, Fox remarked that the plant-based alternatives now represent 8.9% of the combined dairy and plant-based ‘milk’ market. He said that in other countries with mature dairy markets, these alternative beverages tended to level off in growth when reaching 10% of total dairy market share. But at the same time, the combined dairy and plant beverage sector has also declined from 6.4 billion units in 2013 to 6.1 in 2017, according to Fox.

He noted the alternatives are also infiltrating other dairy product categories and that these ‘next generation’ products are offering much better nutrition than earlier versions. “But they will never compete with dairy milk, nutritionally,” Fox said.

What these alternative beverages have going for them, said Fox, is very high margins for processors and investors.

He explained that plant-based dairy products have low ingredient costs, are easier to manufacture, package, market and distribute and are seen as ‘greener’ and animal friendly. They are better positioned for e-commerce and kiosk-type retail outlets and are made by innovative marketing companies and startups with a market and margin profile that attracts investors.

Meanwhile, dairy milk is a highly regulated market with a prevailing commodity mindset worn down even more-so by supermarket price wars at the retail level, making it difficult for the dairy milk sector to adapt to U.S. consumer market trends.

U.S. consumer trends gravitate toward innovation and specialization so everyone can be a ‘snowflake,’” Fox explained, adding that areas of growth for the dairy milk sector will be full-fat in smaller containers, dairy protein in sports nutrition, and non-GMO branding. (No joke: Look for more later on genetically-modified, aka GMO, lab-manufactured products like Perfect Day that are actively defending what they see as their right to use the term ‘animal-free dairy’ because their product is said to be compositionally the same as milk, derived from genetically modified laboratory yeast exuding a white substance they say IS milk.)

That said, where is the true and simply original dairy in its re-branding process? What efforts are being made to compete to reverse this fluid milk market decline? Wouldn’t revitalization of the fluid milk sector also provide a demand pull for U.S. production growth?

Fresh fluid milk is not interchangeable on the global stage as are milk powders, fat powders, protein powders, cheeses, butter and aseptically packaged shelf-stable fluid products.

Meanwhile, the fastest growing surplus regions of the U.S. are busy aligning with retailer/processors and utilizing the Federal Order pricing schemes to pull their production growth into milk-deficit regions, leaving the milk-deficit region’s producers sending their milk to manufacturing homes in other Orders, or even looking for ways to export from eastern ports.

The U.S. has the water, the feed, the space, the transportation, logistics and support infrastructure, as well as a large existing domestic market to anchor the base production level of our nation’s farmers. The U.S. also has a legacy of dairy producers that are respected for their progress, animal care and food safety.

The ingredients for global success are here, but other factors need evaluation because the success is eluding dairy farm families as they face their fourth year of low prices and lost markets forcing increased numbers to exit the business.

In future installments of this multi-part series “Global Thoughts,” we’ll look more closely at the export side of this fork in the road, including the product trends, product and trading platform differences, imports, transportation and logistics, the role of regulatory pricing and cooperative base programs at a time when the dairy landscape is being forever changed.

As this series proceeds, thoughts and questions are welcome: agrite2011@gmail.com

 

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Will ‘local’ focus stem tide of milk displacement?

PA-preferred (1).jpgHarrisburg Dairies, Schneider’s Dairy step up for milk from at least 9 of 42 dropped Pa. farms

 

(Author’s note: Farmers whose milk has been displaced in 8 states are in various stages of determining their futures. Some are exiting the dairy business, a few have been picked up by cooperatives, or as in the case of this story, by processors. Some are resorting to marketing milk with brokers at much lower prices. In addition to PA Preferred, Tennessee’s legislature is working on a state label for milk.)

By Sherry Bunting, Farmshine, March 30, 2018

BROWNSTOWN, Pa. — In the days following the “Save Pennsylvania Dairy Farms” town hall meeting in Lebanon March 19, some breakthroughs came for 9 of the 42 Pennsylvania farms notified by Dean Foods that their contracts will end May 31.

Harrisburg Dairies, based in Harrisburg, picked up 5 (possibly 9) of the 26 farms let go by Dean’s Swiss Premium plant in Lebanon.

Schneider’s Dairy, based in Pittsburgh, picked up 4 of the 16 farms let go by the Dean plant in Sharpsville.

Both Harrisburg Dairies and Schneider’s Dairy source their milk through direct relationships with local family farms, and they use the PA Preferred logo on their milk labels, signifying it was produced and processed in Pennsylvania, which also means the state-mandated over-order premium paid by consumers is passed back through the supply chain.

“It really made the decision for us, when it came to needing our milk supply to be independent producers that we can have a direct relationship, monitor and inspect ourselves,” Alex Dewey told abc27 News, Harrisburg about the PA Preferred label and their decision to add five of the displaced farms to their Pennsylvania-sourced milk. Dewey is the assistant general manager of Harrisburg Dairies.

Likewise, Schneider Dairy president William Schneider told Clarion news that, “We really didn’t need the milk, but… these people were going to lose their livelihood. I didn’t want people to be out on the street, so we did what we could.”

Both dairies appear to have chosen their 4 and 5 farms based on hauling routes and proximity to their respective plants.

Meanwhile, the situation is in limbo the remaining 12 farms in western Pennsylvania, along with the handful of Ohio and New York producers, affected by volume adjustments at Sharpsville and New Wilmington as well as 21 in eastern Pennsylvania affected by volume adjustments at Dean’s Swiss plant in Lebanon.

In addition, producers affected by these notices in Indiana, Kentucky, Tennessee and the Carolinas are also currently still seeking markets. A few in the Southeast have made plans to sell, but overall, there are still about 100 dairy farms displaced by Dean’s system-wide consolidation and Walmart’s new plant coming on line in May in Fort Wayne Indiana.

Some other marketing factors are emerging.

For example, the Dean Sharpsville plant continues to notoriously bring in loads of milk from Michigan. The company confirms that the 90-day notices sent Feb. 26 to over 100 dairy farms in 8 states, did not include Michigan.

The Sharpsville plant was referenced specifically in the December Pennsylvania Milk Marketing Board (PMMB) hearing where the Pennsylvania Association of Milk Dealers and Dean Foods requested a significant reduction in the producer over-order premium to its lowest level in 17 years. This change to a 75-cent mandated premium went into effect for wholesale and retail milk price minimums January 1.

At the time of the hearing, both John Pierce and Evan Kinser of Dean Foods testified that retailers are getting accustomed to bargain-priced milk elsewhere with documented retail milk prices offered to consumers in other states as low as 87 cents per gallon. Kinser testified that this new reality made Pennsylvania’s high state-minimum retail milk price an increasingly attractive destination for milk bottled elsewhere.

Kinser had further testified that the pressure from the increasing influx of out-of-state milk was making it difficult for milk produced in Pennsylvania to compete for retail (and apparently farm level) contracts.

Kinser also indicated that the mix of milk sourcing at the Sharpsville plant, in December, was already much different than the mix at the Swiss Premium plant in Lebanon. With Sharpsville close to the Ohio and New York borders, the plant has been sourcing milk from Ohio and New York for some time, but also increasingly from Michigan and Indiana.

In fact, at the December PMMB hearing, Kinser’s much-redacted testimony warned of Pennsylvania milk becoming displaced and that the new and lower 75-cent over-order premium level is “already a compromise that represented the highest level the current economic conditions can sustain.”

Kinser warned that if the premium were any higher than 75 cents, Dean Foods would be forced to renegotiate its contracts with suppliers to change the mix of milk used at ALL of its plants within the state in order to compete for contracts with packaged milk coming into the state from plants beyond Pennsylvania’s borders.

Even though the PMMB granted Dean’s request to lower the mandated premium to 75 cents, it appears the mix of milk is being renegotiated anyway as part of the company’s milk supply chain consolidation process as the volume adjustments at Pennsylvania plants have fallen primarily onto Pennsylvania farms.

Also emerging in the marketplace is the increased occurrence of brokered milk. This trend began in 2013 as producers across the Northeast and Mideast have dealt with contract losses in the fluid market at smaller levels than seen today.

Great Lakes Milk Producers is an example of a recently organized group of producers from Ohio, Michigan and Indiana, which is organized “like” a cooperative but markets milk as single-source loads through a broker.

Part of the drill is getting the milk qualified with farm audits and certifications as single-source loads that can be matched up to spot needs from cheese and yogurt plants to even, at times, the Dean plant in Sharpsville, Pennsylvania, the Southeast in the summer, and potentially even the new Class I Walmart plant in Fort Wayne.

Marketing through a broker can mean a long haul in a long market with changing conditions. This option makes milk quality a mandate without a premium.

As 27 farms in Indiana continue to seek a market, it is unclear whether brokering with Great Lakes Milk will become an option. The size of the displaced Indiana family dairy farms fits the single-source criteria, ranging 300 to 1500 cows and collectively represent an estimated 20 million pounds per month of displaced milk volume let go by a Dean plant in Indiana as well as Louisville, Kentucky.

“This is a huge issue for our state right now with an overwhelming impact,” said Indiana Dairy Producers executive director Doug Leman at a recent annual meeting in Indianapolis about the 27 farms with displaced milk scattered around the state. “Conversations are starting to happen, and we are planning a meeting for these farms. But just because Dean is not buying this milk, does not mean that the consumer demand has gone away. We have to let the dust settle and go through the milk shuffle.”

Among the recently affected Indiana farms is the sixth generation Kelsay Dairy Farm, operated by brothers Joe and Russ Kelsay and milking nearly 400 cows near Whiteland.  Joe Kelsay was the milkman for last year’s Indy500.

“We are exhausting all contacts and connections with cooperatives and plants,” said Kelsay in a phone interview. “Several told us they are not in a position to take any additional milk, some are doing some checking, and we do have a couple meetings scheduled. We are cautiously optimistic.”

When asked if the new Walmart plant will pick up any of the Dean dropped farms, Leman said the plant’s supply has been locked up with a percentage coming from undisclosed dairies doing contracts directly with Walmart and the balance being single-source loads via third parties.

“We can’t tell Walmart where to get the milk, but we are letting them know to check with these farms,” said Leman. “Some are within 50 miles of the plant.”

Kelsay doesn’t blame either Dean or Walmart for the market loss his family and others are experiencing. “This is a difficult time, but we can’t fault one company or another for doing their best to run their businesses,” he said.

Meanwhile, in Pennsylvania, town hall meetings were held (and reported in last week’s Farmshine) to raise public awareness. Ag Secretary Russ Redding wrote to Dean Foods asking for contract extensions.

But Dean has indicated its problem with excess volume will begin before these contracts end.

“We explored all our options before we made this decision,” noted Reace Smith, Dean Foods director of corporate communications. “At this time, we can’t extend the contracts further. As a fluid milk processing company, we are unable to store milk long-term.”

The timing is difficult with spring flush and spring decisions around the corner.

“We’re all in limbo right now,” said Agri-King nutritionist Bob Byers in a phone interview. He works with 25 farms, serving in the affected area of western Pennsylvania for 20 years. He notes that affected farm families have only so much time to make decisions like what crops to plant, what fuel and supplies to order. These decisions revolve around whether or not they will be milking cows after May 31.

“There is a timeline involved to unwind a multi-generational dairy farm with inventories of cows and feed and with a team of employees to think about,” says Kelsay. “If there is no one to purchase our milk, how can we continue? What happens here has a significant impact on our team of employees, and their families, as well as our hauler, nutritionist, equipment and feed suppliers – our whole web of contacts. We do a lot of business with a lot of people.”

Byers notes that this is the worst of times in the dairy business that he has seen in his 20 years and that it definitely affects local jobs and businesses.

Lebanon9495(Signs)

“Local people want local milk,” he said. “That is the only thing that will help these local farms at this point. Media attention will help get that message in front of consumers, and in front of companies like Walmart.”

CAPTIONS –

PA-preferred

Alisha Risser of Lebanon posted this photo of Harrisburg Dairies’ milk displaying the PA Preferred label signifying the milk was produced on Pennsylvania farms. The Rissers were part of a town hall meeting in Lebanon reported in last week’s Farmshine, and they are one of five farms whose contracts were dropped by the Dean Swiss Premium plant in Lebanon that will be picked up by Harrisburg Dairies.

 

 

 

 

‘This is the face of the dairy crisis’

(Author’s note: Look for an update here soon about developments since this town hall meeting on 3/19. As of 3/31, in eastern Pennsylvania, 9 Lebanon County dairy farms have been picked up by Harrisburg Dairies, 2 have been picked up by a cooperative and 2 have decided to exit the dairy business, leaving 2 Lebanon County farms and 11 Lancaster County farms still seeking a market. In western Pennsylvania, 4 of the 16 farms have been picked up by Schneider’s Dairy based in Pittsburgh, leaving 12 still needing a market for their milk.)

Lebanon9490(crowd)Emotional town hall meeting in Lebanon, Pa. draws over 200 people urging contract extensions for Dean’s dropped dairies

By Sherry Bunting, Farmshine, March 23, 2018

LEBANON, Pa. – “Family is a treasure for all of us here, and we have a family crisis concerning our dairy farms,” said Randy Ebersole, a local car dealer whose family has been part of the Lebanon community surrounded by dairy farms for generations. He moderated a “Save Pennsylvania Dairy Farms” town hall meeting about the 26 Lebanon and Lancaster County dairy farms that received 90-day milk contract termination letters from the Lebanon Swiss Premium plant owned by Dean Foodd on March 3.

The meeting drew 200 people to the Expo Center Monday (March 19) and was covered by three television stations and a host of other media.

State representatives Frank Ryan, Russ Diamond and Sue Helm also attended and spoke about their commitment to work with farmers on solutions.

Jayne Sebright, executive director of the Center for Dairy Excellence also attended, mentioning the Center’s resources for counseling and support as well as a joint venture with the Pennsylvania Dairymen’s Association to launch a “local and real milk” promotion by June Dairy Month.

Pa. Ag Secretary Russell Redding was not present, but Sebright said he will be sending a letter to Dean Foods in support of an extension of terminated contracts for 42 Pennsylvania dairy farms, the 26 in eastern Pennsylvania and 16 shipping to Dean plants in western Pennsylvania.

“This is the face of the dairy crisis. This is not fake news. This is real,” said Ebersole of the panel of three producers, a nutritionist, a veterinarian and a feed mill manager who shared their stories of the impact to the farms whose milk contracts will end May 31, 2018. This represents about half of the Lebanon plant’s daily milk intake.

The message of the town hall meeting was simple: Don’t blame or boycott Dean Foods because there are still another 40 local farms who did not get letters and are supplying the Swiss plant in Lebanon. But do, write, call or email support for a contract extension for these terminated farms until fall or winter.

And yes, drink more milk and eat more dairy products, especially locally-sourced dairy, knowing how it supports healthy bodies and healthy communities.

All told, Dean Foods ended marketing agreements with over 100 farms in eight states as the company says it adjusted its milk volume because of a supply and demand imbalance made worse by the trend among retailers, namely Walmart, to vertically integrate into bottling their store brands and compressing the supply-chain with consolidated intakes and wider distributions.

The emotional 2-hour meeting revealed community support for these farms by those who recognize how these farms touch many of its jobs and businesses.

Yes. A legacy is on the line here. And there were plenty of youth among the 200 attendees, many of them from local dairy farms where the future is uncertain due to the current dairy economics and especially for those in the families whose farms have been blind-sided by these 90-day termination letters.

One after another, people voiced their concern that 90 days is not enough time to find a new market at the worst time of year, ahead of spring flush, nor is it enough time for these families to unwind their businesses by selling cows, assets, even their farms and their homes to settle their lifetime investments in a way that allows these farm families to find a path forward.

“You will not find a more dedicated and hard-working people than dairy farmers,” said Ebersole. “They have invested their money, their time and their lives developing their herds and their businesses. We understand the world is changing, and that we are not an island, but what has not changed is the expectation of fair and reasonable treatment.”

A local pastor asked a blessing on the meeting and referenced Psalms 139 where David asks God ‘search me… and know my heart; test me and know my anxious thoughts. See if there is any offensive way in me and lead me in the way everlasting.’

The parallels of this passage to what these farmers are facing were obvious in the emotion that followed as each of six panelists told their stories and as others attending lent their support and as 8-oz chugs of Dean’s TruMoo milk and trays of cheese from the Lebanon County dairy royalty were enjoyed.

No one blamed Dean Foods.

Producers talked of a good relationship with the plant. They talked of how the letters completely turned their worlds upside down. They talked of how they have called eight to 10 other milk buyers in the region, none of them stepping up to accept new milk.

“Our cows are like our children,” said Kirby Horst of Lynncrest Holsteins, which has produced milk for the Lebanon Swiss Premium plant for 60 years across two generations. “The thought of 90 days and no market for our milk and no place for our cows to go… the thought of looking out at the pastures and not seeing the cows … I don’t know if I can handle that.”

The affected producers and the businesses that serve them stressed that with a little more time, they could do what is best for their families.

“Just like all the 26 farms affected in this community, our minds are missing right now,” said Alisha Risser. She and her husband have been shipping their milk to the Swiss plant for 17 years. She described how they worked full time jobs and saved and rented a barn before purchasing a herd and then building a dairy full time on their farm in 2001, when they began shipping milk to the plant in Lebanon.

“We have been lucky to have our passion be our job every day and to share this with our kids,” said Risser, her voice tinged with emotion as she described how her husband and youngest son bounce ideas off each other about the cows and the crops. “Our children wonder what future we have now. This is such a feeling of helplessness.

“We are proud of our milk that we produce on our farm, and we are proud of the Swiss Premium milk in our community,” she added. “We are just asking the community to support us with letters to Dean Foods to provide a contract extension until fall or winter.”

As milk pricing, promotion, regulatory environments and dietary guidelines are sorted out in the coming months, these farms are left without a milk market, without an opportunity to compete, to survive.

“God is always faithful, and we know we will be okay in the end, but an extension would allow all 26 farms here to make decisions for our families and our futures,” Risser said.

Ebersole added that, “These farms have developed their cow herds over a long period of time. They are rooted in our community. It’s not like a car dealership where you can just go to the Manheim Auto Auction and get in the business of selling cars.”

Lebanon5278(ProducerPanel).jpgIndeed, a legacy is on the line in Lebanon and Lancaster Counties, as in other communities similarly affected.

“I am not sure how we are going to handle this going forward. We have put all we have into the farm. Nothing will settle like it should,” said Brent Hostetter, who received his letter a week after the other farms on his milk hauling route were notified. Hostetter and his wife have been shipping to the plant for 19 years.

“Our kids love the farm. It has been going three generations, and now I am not sure how we can see a fourth,” said Hostetter. Like the others, he said a contract extension would give them some time to figure things out.

He also encouraged the public to “support our Pennsylvania farmers” to buy local milk and to look at the plant codes.

Lebanon5282(AgBizPanel).jpgRick Stehr, a nutritionist and owner of R&J Consulting, directed some of his comments to the significant number of youth in the audience, saying that these farms are where the next generation learns morals, values, work ethic and the joys and failures of life.

“This is worth fighting for,” said Stehr, “worth fighting all together for.”

He noted that for every 9 milk cows in Pennsylvania, one job is supported in the related business infrastructure. In Lebanon County, alone, one job is supported by six cows. The impact is deep if these cows and farms are lost, he said.

“Each cow here produces $14,000 in revenue for our community,” said Stehr, “16% of U.S. dairy farms are located in Pennsylvania where the average farm size is 80 cows. We are not California or New Mexico. We are located well within a day’s drive from 50% of the U.S. population. It seems our location would be pretty good, and yet this is happening.”

The emotion was palpable as Stehr and others offered to do whatever is needed in terms of counseling and assistance through this.

Alan Graves, manager of Mark Hershey Farms, a prominent feed mill in Lebanon County, said 80% of the mill’s feed business is dairy.

“We have been in business 45 years and employ 55 people in this community,” said Graves. “This day is about the producers and how they affect everything else in our communities. Our mill employees and their families rely on these dairies for their jobs. We don’t make business projections for 90 days, we are out a few years in our projections.

“The extension these producers are asking for is a fair request,” he added. “They have spent their lives improving their cows and improving the product they produce. The thought of taking that away in 90 days is almost unjust.”

Ebersole described the community impact this way: “These folks write out checks to other businesses in our community. There has to be a check coming back the other way. In 90 days that will all stop.”

Dr. Bruce Keck of Annville-Cleona Veterinary Service talked about how the public is unaware of what has been happening over the past 30 days and the past 10 years of consolidation and change. He asked the three television stations represented to raise awareness.

“We want to bombard Dean Foods with letters and emails and phone calls,” he said.

“These dairy farmers are so invested in cows and equipment that they can’t just quickly turn around,” said Keck, who has worked with local dairy farmers as a veterinarian for 25 years and took over the practice started by his father in 1961. He understands the family business dynamics.

“Without an extension, these families will be forced to sell their herds, and even their farms, for a fraction of their worth in this environment,” said Keck, “and that will trickle down to affect truckers, nutritionists, equipment companies, feed mills, veterinarians and more. This is like asking a loaded tractor trailer to turn as fast as a speeding car. It’s not enough time.”

To communicate support for the farms facing 90-day termination of contracts, call Dean Foods at 214-303-3767, email dairydirectsupport@deanfoods.com, or mail a letter to Dean Foods, 2711 North Haskell Avenue, Suite 3400, Dallas, TX, 75204.

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Lebanon5240(Hostetter)Brent Hostetter, Lebanon County dairy producer: “I am not sure how we are going to handle this going forward. We have put all we have into the farm. Nothing will settle like it should.”

 

Lebanon5228(Risser)Alisha Risser, Lebanon County dairy producer: “We are proud of our milk that we produce on our farm, and we are proud of the Swiss Premium milk in our community. We are just asking the community to support us with letters to Dean Foods to provide a contract extension until fall or winter.”

Lebanon5216(Horst)Kirby Horst, Lebanon County dairy producer: “The thought of looking out at the pastures and not seeing the cows … I don’t know if I can handle that.”

Randy Ebersole, local car dealer and panel moderator: “This is not about blaming or boycotting Dean Foods. Please do the opposite, fill yourselves up with these dairy products.”

Lebanon5260(Kreck)Dr. Bruce Keck, Annville-Cleona Veterinary Service: “Without a contract extension…This is like asking a loaded tractor trailer to turn as fast as a speeding car. It’s not enough time.”

Lebanon5272(Stehr&Moderator)Rick Stehr, R&J Consulting: “This is worth fighting for…worth fighting all together for.”

Lebanon5257(Graves)

Alan Graves, Mark Hershey Farms: “These producers have spent their lives improving their cows and improving the product they produce. The thought of taking that away in 90 days is almost unjust.”

Lebanon9500(Helms)Rep. Sue Helm: “A group of representatives are writing a letter Dean Foods. We want farmers to stay in contact with us.”

Lebanon5291(RepDiamond)Rep. Russ Diamond: “We wanted to get Pennsylvania milk into Pennsylvania schools but have been told that with the product stream in Pennsylvania, this is hard to do. This Pa. Milk Marketing Board issue is a hard issue to get to the bottom, and people get very protective of it.”

Lebanon5303(RepRyan)Rep. Frank Ryan: “Keep faith first and foremost and your sense of humor and talk with your bankers. This is emotionally draining and people want to run from it. There is a solution and we need to work together to find it.”

Lebanon5314(Morrissey)

Bernie Morrissey, retired agribusinessman: “Dairy farmer Nelson Troutman got me involved in this nine years ago, and I have given up my retirement to work on this issue because it’s important to our farms. No matter who buys your milk, this is all connected… There are over 25 milk contracts from outside dairies selling milk in Pennsylvania while you guys are under the Pa. Milk Marketing Law. You have been shafted.”

Lebanon5318(EbyMike Eby, chairman National Dairy Producers Organization and former Lancaster County dairy farmer: “The media are our friends. We can work with the media to advertise our product in ways the (check off) promotion programs can’t.”

 

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