Tag Archives: sustainability

Part Two: What drove rockier road for 2023 milk prices? Manure. Imports. Concentration.

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— Along with more imports and shifts in cheese production, major manure-driven expansion in cheese-heavy Central U.S. put pressure on region’s ‘disrupted’ processing capacity

By Sherry Bunting, Farmshine, Updated in reflection from original publication in July 7, 2023 Farmshine

EAST EARL, Pa. — What has driven the rockier road for 2023 milk prices? Many things, and manure may be top on the list.

In fact, we’ll cover the ‘manure effect’ in a future article. But are we beginning to see the methane wheel-of-fortune behave with the ‘cobra effect’? (The British government, concerned about the number of venomous cobras in Delhi, offered a bounty for every dead cobra. Eventually, however, enterprising locals bred cobras for the income.)

This happened with greenhouse gases in the past. It happened with a byproduct gas of making refrigeration coolant. In 2005, when the UN Intergovernmental Panel on Climate Change began an incentive scheme. Companies disposing of gases were rewarded with carbon credits, which could eventually get converted into cash. The program set prices according to how serious the environmental damage was of the pollutant. (Like making cow methane seem like new methane when it’s not). As a result, companies began to produce more of the coolant in order to destroy more of the byproduct gas, and collect millions of dollars in credits. This increased production also caused the price of the refrigerant to decrease significantly.

With this prelude, let’s look back in retrospect on what I reported in the July 7, 2023 Farmshine when milk markets were in a tailspin hitting their low for the year — just 10 days before the gradual turnaround began.

As losses in the CME spot cheese markets and Class III milk futures markets continued through July 6, the Federal Order benchmark Class III price for June was pushed down to $14.91 per cwt. and protein down to $1.51/lb, July and August futures went well below the $15 mark, with Class III below $14.

Let’s look at the supply side of the January through June 2023 supply and demand equation.

Looking at the May Milk Production Report that was released in June, it’s hard to believe the bearish response we saw in milk futures and spot cheese markets that occurred based on a mere 13,000 more cows nationwide that month. It was a paltry 0.1% increase over a flat 2022, along with 11 more pounds of milk output per cow for the month (up 0.5% over flat 2022).

This flipped the switch from a gradually lower-than-2022 market to one that plunged sharply and suddently into the dumps – and all the analysts said: ‘We’ve got too much milk for demand.’ (In fact, two months later, processors are pointing to June and July milk dumping and $10 under class spot milk price as proof that USDA is setting Federal Milk Marketing Order minimum prices too high! — I digress).

As noted in Part One of this series that was published in the june 30 edition of Farmshine, other converging supply-and-demand factors plagued cheese markets that month until July 17 — despite basic fundamentals of these milk production reports not being all that bad. 

USDA Dairy Market News said spot loads of milk were being discounted in June by as much as $11 below the already abysmal FMMO Class III price in the Midwest. The milk dumping that reportedly began in May in Minnesota moved into Wisconsin through June and into July. The July 5th Milwaukee Journal Sentinel reported “Truckloads of fresh farm milk have been flushed down the drain into Milwaukee’s sewer system recently as dairy plants, filled to the brim, couldn’t accept more.” The story notes this had gone on for weeks, and the amount has declined to 5 trailer loads per week by the time The Milwaukee Journal Sentinel published its report.

For the price and milk dumping fallout, economists and analysts blamed the higher milk production (though it was modest on a national basis but huge in the Central U.S.). They blamed the higher cheddar cheese production (not accompanied by higher inventory), and they blamed the lower volume of exports (modestly below year ago on a year-to-date solids basis). 

Globally, milk production was up (it is declining this fall), they said, suggesting U.S. prices needed to get below the falling global prices in order to recover more export volume (instead of dumping in the sewer). Well, they got what they wanted as the U.S. prices dropped like a rock through June until the turnaround on July 17.

Of course, no one (but Farmshine) mentioned the rising imports that were reported in Part One of this series.

Looking for context on the imports, we reached out to retired cooperative executive Calvin Covington, who follows these things on a total solids basis and has been watching the whey market as a leading milk market indicator. We learned that his calculations on a total solids basis, pegged January through April 2023 imports of dairy products into the U.S. at levels 15% higher than a year ago!

“The 15% equals 39.3 million lbs. more solids,” Covington wrote in an email response to a Farmshine question. “Most of the imports are coming from Europe. Dairy demand is very weak in Europe, consumers have less money to spend. Those milk solids are moving out of Europe.”

Noted Covington in June: “On a total solids basis, ending dairy stocks as of April 30th are 3% higher than last April. The 3% equals 61.5 million lbs. more solids.”

This means the 15% increase in January through April dairy product imports — on a total solids basis — were equal to more than half (63%) of the 3% increase that was reported in April domestic ending stocks of all dairy product inventories on a total solids basis.

Think about that for a minute. Product came in and was inventoried while domestic milk was dumped, and producer prices were crushed so that the domestic price could fall below the global price so then the U.S. dairy exports could increase? It makes the head spin.

Class I sales were down during this time, especially in the Midwest where some fluid plants have closed. Fresh Italian cheese production was down, and that’s a big one for Wisconsin. Together these factors pushed more milk to make more American cheese at that time, some of it delivered to consumers in smaller packages (rationing). 

A wrinkle in the market-fabric comes from the dairy foods complex importing higher volumes, and there are the fake bioengineered microorganisms from which excrement is harvested and described as ‘dairy casein or whey protein without the cow.’ These analogs are being heavily marketed to large food manufacturers making dairy and bakery products as carbon-footprint-lowering dairy protein ‘extenders.’

So much so, that National Milk Producers Federation recently sent a letter to FDA asking the agency not to make the same mistake with these fake products as has been made with plant-based frauds.

However, as we look at the modest milk production increase for the first half of 2023, overall, and compare it to 2022, the total comparison was flattish then and it is declining now as we move toward Q3.

But there’s another major twist to this supply-demand equation:

The location and purpose of dairy expansion is undergoing accelerated transformation on a geographic and structural basis. This transformation is part of the “U.S. Dairy transformation” that the national dairy checkoff has promoted in its Pathways to Net Zero Initiative… and it is affecting the milk pricing for all U.S. dairy farmers, everywhere.

Here’s the problem: Milk production in the Central U.S. has expanded by much more than the national average. 

Even University of Wisconsin economics professor emeritus Bob Cropp noted in his writing after the May report that growth in the Midwest — where cheese rules the milk check — was outpacing processing capacity, and the existing capacity to process all this milk was being reduced by labor and transportation challenges.

The concentrated expansion of milk production in the Central U.S. has been accelerating since 2018, but a new paradigm is now in effect: New concrete is being poured in the targeted growth areas driven more by manure, than by milk, and new dairy processing plant construction that is completed and in the works is targeting the same areas.

This is creating a production bubble that is a flood within calmer seas.

Some are calling it the California RNG gold-rush as developers construct Renewable Natural Gas (RNG) projects — especially on new large dairies — for the California RNG market and to collect the low-carbon-fuel credits for the California exchange and other exchanges that are and will be emerging, thanks to the USDA Climate Smart wheel-of-fortune.

We’ve heard the national dairy checkoff managers from DMI talk about profitable sustainability, markets for manure, promotion of other revenue streams for dairy farms as part of the mantra the checkoff has assumed for itself as speaker for all-things-dairy for all-dairy-farmers on what is “sustainable” for the industry.

When the Net-Zero Initiative was launched — along with DMI’s industry transformation plan — it was something that had been in the works since 2008 and emerged more prominently in the 2017-21 period when the former and current U.S. Ag Secretary Tom Vilsack did his stint as top-paid DMI executive, presiding over the U.S. Dairy Export Center (USDEC) under DMI’s umbrella and as a top-talker on the Innovation Center for U.S. Dairy, also under DMI’s umbrella. 

All three: DMI, USDEC, and Innovation Center for U.S. Dairy are 501c6 non-profit organizations contracted to spend checkoff dollars. A 501c6 is essentially a non-profit that can lobby policymakers, whereas the 501c3 National Dairy Board cannot.

In 2020 and 2021, the Innovation Center — filing tax returns under the name Dairy Center for Strategic Innovation and Collaboration Inc. — doubled its revenue from around $100 to $150 million annually to $300 to $350 million.

We all heard it, read it, thought about it – maybe – that the checkoff was morphing into a facilitator for the transformation of the dairy industry led by manure-promotion, not necessarily milk promotion, with the mantra of feeding the world, being top-dog internationally, and meeting international climate targets with a Net Zero greenhouse gas pledge. (That pledge and the methane calculation are another story Farmshine readers are aware of, but we’ll leave that big driver off the table for this discussion.)

Here we are, now seeing an industry being created from within the broader dairy industry with new production driven by manure, in regions where new or expanding cheese, whey and ingredient plants are being located and potentially displacing production from plants and farms elsewhere that are not tied-into this manure-to-methane wheel-of-fortune using dubious science and math to overpeg a cow’s global warming impact.

While that production bubble is building in targeted growth regions with cheese-heavy milk checks, driven in part by manure-focused expansion, it bursted at the seams this summer due to a processing capacity bottleneck, compounded by supply chain disruptions and a sudden decrease in the production of fresh cheese at other plants and a sudden 18% decline in the amount of milk processed for Class I fluid use in the Upper Midwest.

Here’s the sticky wicket. A review of the 2022 end-of-year milk production report along with reports issued in the first half of 2023, revealed that, indeed, the Central U.S. was “awash in milk.” 

Zooming in on the milk production reports, we see South Dakota continuing its fast and uninterrupted growth — up 15.5% for 2022 vs. 2021, and up 7.4% Jan-May 2023 vs. 2022 — having leapfrogged Vermont, Oregon and Kansas and closing in on Indiana in the state rankings. 

Neighboring Iowa leapfrogged Ohio in 2022 with a 4.7% gain in milk production Jan-May 2023 vs. 2022. Number 7 Minnesota grew again after taking a breather with a 0.6% decline in 2022, then increasing 2% in production Jan-May 2023. 

The tristate I-29 corridor, where cheese processing capacity has been expanding, was up 3.3% in milk production collectively with 19,000 more cows Jan-May 2023. Add to this the 1.3% increase in number 2 Wisconsin’s May milk production, and we saw the quad-state’s collective increase was 203 million pounds of additional milk in the region vs. year ago in May, although Wisconsin’s contribution came from 3000 fewer cows, according to USDA.

Just west in number 3 Idaho, production jumped 3.1% with 7,000 more cows Jan-May 2023.

To the east in the Michigan-Indiana-Ohio tri-state region — where the large new cheese plant in St. John’s, Michigan is fully operational — collective milk output was up 2% over year ago with 11,000 more cows. In 2022, this tri-state region was down 2 to 3% for the year compared with 2021.

Number 5 New York made 2.1% more milk with 7,000 more cows in May vs. year ago, with most of this expansion in the western lake region. 

Number 1 California shrank milk production by 0.7% in May with 2000 fewer cows, and number 4 Texas flattened out its multi-year accelerated growth curve to make just 0.8% more milk in May than a year ago with just 1000 more cows, largely affected by the devastating Texas barn April fire resulting in the loss of around 20,000 cows. 

Neighboring New Mexico continued its multi-year downward slide, ranked number 9 behind a flat-to-slightly-lower milk output in number 8, Pennsylvania. 

Milk production in New Mexico fell 3.8% in May vs. year ago with 10,000 fewer cows. This followed an 8.4% decline in milk production and a 30,000-head cut in cow numbers for the year in 2022. Producers there cite well-access limitations, severe drought, high feed costs with reduced feed availability, as well as receiving the rock-bottom milk price as the reasons dairies in New Mexico are closing or relocating. 

With all of these factors in play, the production reports show a clear paradigm shift in how the dairy industry expands via transformation. It is being driven to where feed is available and milk output per cow is higher, and it’s now being driven by a non-milk-related factor: MANURE for the RNG ‘goldrush’

A saving grace is cattle are in short supply, with replacements bringing high prices. This fact is slowing the bubble, production is declining now, and prices are recovering from those unanticipated lows.

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Dairy checkoff is ‘negotiating’ your future: Train wreck ahead. Stop the train. Correct the track. (DMI Net Zero – Part One)

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By Sherry Bunting, Farmshine, Sept. 16, 2022

Dairy farmers are being used without regard. Their future ability to operate is right now being negotiated, and they are paying those negotiators through their 15-cents-per-hundredweight mandatory checkoff with no idea how the negotiations will ultimately affect their businesses and way of life.

Inflated baselines and an inflated methane CO2 equivalent assigned to cows is setting the stage for a head-on collision, a train wreck on the misaligned track laid by DMI’s Innovation Center for U.S. Dairy.

In fact, the Net Zero Initiative has been designed to help everyone but the dairy farmer. It sets up a methane money game for carbon traders at the expense of those dairy farms that have long been environmentally conscious with no-till, cover crops, grazing, and other practices already on their farms.

Such farms will be of no use in what is shaping up to be a focus on harvesting reductions, not attaining neutrality, in DMI’s Net Zero Initiative (NZI).

Small and mid-sized dairy farms that are already at or near carbon-neutral could show smaller reductions for the industry to harvest. 

Conversely, the largest dairies installing the newest biogas systems are realizing even this route could become a dead-end because the credits are signed over and sold for big bucks, a few bucks get kicked back to the dairy, but the methane capture becomes the property of other industries outside of the dairy supply chain.

If the industry does not act now to stop the NZI train for a period of re-examination, adjustment and correction, then the current trajectory may actually move food companies clamoring for reductions ever closer to alternatives and analogs that boast their climate claims solely on the fact that they are produced without cows.

This is a big money game that is operating off the backs of our cows, and the checkoff has been at best complicit as a driver.

RNG (renewable natural gas) operators are signing up large (3000+ cows) dairies left and right for digesters and covered lagoons to capture methane piped to clustered scrubbing facilities to be turned into renewable fuel for vehicles or electricity generation. Meanwhile dairy protein analogs are being created without cows by ‘precision fermentation’ startups partnering with the largest global dairy companies.

In turn, millions if not billions of dollars in carbon credits are generated while farmers and their milk buyers will be left figuring out how to show their reductions when they are left holding the inflated methane bag.

Six organizations, four of them non-profits under the DMI umbrella, officially launched the Net Zero Intitiative (NZI) in the fall of 2019, five months after Ag Secretary Tom Vilsack made headlines talking about it in a Senate hearing while he was pulling down a million-dollar salary as a DMI executive in 2018.

NZI is the proclaimed vehicle for negotiating the terms for U.S. Dairy to continue, terms based on showing carbon reductions that many family farms may find difficult to meet — especially if the farm is already at or close to carbon neutral.

As DMI’s sustainability negotiators data-collect all previous reductions into farm-by-farm comprehensive baseline estimates, where will those farms find new reductions? 

According to DMI staff, over 2000 dairy farms have already gone through their environmental stewardship review via the FARM program to establish their “comprehensive estimates.”

The six organizations, four of them filing IRS 990s under the national dairy checkoff, that launched NZI are: Dairy Management Inc. (DMI), Innovation Center for U.S. Dairy, U.S. Dairy Export Council (USDEC) and Newtrient, along with the other two organizations being National Milk Producers Federation (NMPF), and International Dairy Foods Association (IDFA).

They have collectively bought-into the global definition that inflates the CO2 equivalent used for methane, effectively committing the cow to perpetual GHG purgatory. 

Because the NZI structure is based on continually showing GHG reductions, no farm is insulated with a get-out-of-jail-free-key — not even the largest farms with the most advanced biogas systems.

Why haven’t checkoff funds been used to defend the cow – to get the numbers right, to get the current practices farmers have invested in counted toward reductions not baselines, and to get the methane CO2 equivalent correct — instead of giving in to this notion that feels an awful lot like ‘cows are bad and we are committed to making them better?’

Perhaps it was ignored or embraced because this inflated methane CO2 equivalent gives the suite of tech tools being assembled by DMI’s Newtrient a bigger runway to show reductions — a money maker for the RNG biogas companies and others that will in many cases end up owning the carbon credits after paying the farmer a nominal fee. 

Carbon trading rose 164% last year to $851 billion, according to a Reuters January 2022 report. A big chunk of this is coming from the methane capture and fossil fuel replacement of RNG biogas projects, mostly in California but popping up elsewhere at a rapid rate and mostly traded on the California exchange.

Farmers are getting some money for these projects, but they don’t own the carbon credits once they are sold or signed over. When they are sold outside of the dairy supply chain, this reduction becomes someone else’s property, so it is no longer part of the dairy farm’s footprint nor the footprint of their milk buyer. 

Likewise, this inflated methane equivalent — along with the emphasis on reductions, not neutrality — has some processors wondering if they’ll be able to come up with the Scope 3 reductions they need in ESG scoring.

They are facing upstream pressure from retailers and consumer packaged goods (CPG) companies as well as asset managers to show reductions, and they have counted on big numbers from their Scope 3 suppliers, the dairy farms.

The problem for dairy processors and dairy farmers comes down to the central definitions of methane equivalent and carbon asset ownership — the rights of farmers to own their past, present and future reductions, whether or not they’ve signed them over as offsets to a milk buyer or a project investor and whether or not they’ve sold the resulting credits on a carbon exchange, and whether or not they’ve installed new practices that are now part of a baseline but represent a new investment every year as they operate their businesses.

Back in June, the American Dairy Coalition added this concern to their list of federal milk pricing priorities because of the impact this climate and carbon tracking will have on milk buying and selling relationships and contracts — and the lack of clarity or fairness in this deal for essential food producers at the origination point that is closest to nature, the farm. 

ADC worded their “carbon asset ownership” priority this way: “No matter where a dairy farm’s milk is processed, that farm should be able to retain 100% ownership at all times of its earned and achieved carbon assets, even if this information is shared with milk buyers to describe the resulting products that are made from the milk.”

For its part, IDFA took a swing last Friday, going one step farther to recommend global accounting methods that would allow the dairy supply chain (farmers and processors) to retain carbon credits even if they are sold on a carbon exchange or signed over to an asset company that invested in an on-farm technology. 

IDFA executives penned the Sept. 9 opinion piece in Agri-Pulse laying out the concerns of their members who are starting to realize the future consequences of the rapid and inflated monetization of methane — and the race to sell carbon credits — leaving dairy processors unable to get those credits they were counting on from the farms that supply them with milk, while at the same time being stuck facing the cow’s inflated methane CO2 equivalent in their downstream Scope 3 even while they try to get reductions in their own controlled areas of Scopes 1 and 2.

When dairy farms no longer own their reduction or cannot show a large reduction because they are already virtually neutral, processors become concerned about how they will gain the Scope 3 reductions that are part of the ESG scoring the large retailers and global food companies are pushing. 

All of this has come down through the non-governmental organizations like World Wildlife Fund (WWF), investment and asset management sector via the World Economic Forum (WEF), the global corporate structures through the Sustainability Roundtable and through government entities via the United Nations Agenda 2030. DMI has been at those tables for at least 14 years.

“It is becoming clearer every day that the global accounting standards underpinning GHG measurement and reporting are biased against the very people making the (GHG) reductions,” the IDFA executives wrote in their opinion.

In other words, while some farmers are beginning to profit from GHG-reducing practices that are turned into offsets and traded on the carbon markets, the system is tilted against them because it leaves them without the offsets they traded and leaves them in a position of having to continually reduce in order to secure a position in the value chain.

IDFA points out that under the current rules, once the offset is sold outside of the value chain as a carbon credit – it is gone. The current GHG accounting system says only the buyer of that reduction can claim ownership.

Those farms can no longer claim their own reduction, and it means the company buying milk or other commodities from a producer cannot integrate the reduction into the description of their final product.

This weakens U.S. Dairy, the IDFA opinion states, and it makes dairy farmers less competitive sources of pledge-meeting carbon reductions for retailers and manufacturers – setting real dairy up for fake dairy dilution with the inclusion of whey proteins and other pieces of milk that are being produced in fermentation vats by genetically modified yeast, fungi and bacteria, as well as other analogs.

A bigger problem not mentioned in the IDFA opinion may be the inflated baselines that leave farms that have implemented best practices years ago positioned to show smaller reductions.

While the American Farm Bureau earlier this year lobbied against proposed SEC accounting intrusions for quantifying ESG scoring, it has been silent on the issue of carbon asset ownership for food producers. AFBF has also said little about the recently signed climate bill (Inflation Reduction Act).

National Milk Producers Federation, on the other hand, as reported last week, sang its praises for being right in line with where the industry’s Net Zero Initiative is going.

DMI voices its pride to have been leading the way, positioning its Innovation Center as founded by dairy farmers. They have conceded that dairy farms impact the environment and launched NZI as a collective pledge to reduce that impact.

In other words, DMI submitted to the idea that cows impact the environment, but never fear, through NZI, the Innovation Center and Newtrient, farmers will make them better, and turn them into a climate solution.

This is a fool’s errand given the inflated methane equivalent and the movement of carbon reductions to entities outside of the dairy supply chain such as paper mills, bitcoin miners, and the fossil fuel industry.

Did dairy farmers have a say in any of this? Not really. They were kept in the dark as this was developed over the past decade or more, and the boards representing them on the six organizations that launched NZI (four of them under the checkoff umbrella) have been duped.

Farmers are largely unaware of the NZI train, and their silence as it runs down the track becomes a further signal to the industry and to the government that they approve of the track they are on.

As the industry sits at this crossing, the Net Zero train full of dairy farmer passengers is barreling high speed down the track DMI has laid.

This train must be stopped because the future-bound track needs to be re-examined, adjusted and re-aligned so that the passengers are not ejected by the train wreck – the accelerated consolidator — that lies ahead.

Fundamentals must be vigorously revisited. Every passenger on that train, every dairy farm, must be recognized as an essential food producer, get credit for their prior investment in current practices, and be able to retain ownership of their carbon assets as part of their farm’s footprint — even if these assets have been provided, sold or signed over as offsets to milk buyers or project investors or traders on an exchange.

Furthermore, this train – built with farmer dollars – should protect the so-called founding farmers from being denied a market based on the size of their GHG reductions. If a carbon neutral farm can’t show reductions to its milk buyer, will that buyer look for other downstream vendors who can fulfill their Scope 3 reduction needs?

Will those vendors be other farms with larger perceived GHG reductions or will they be alternative analogs created without cows?

Nestle announced this week it is partnering with Perfect Day toward that end. In fact, the proliferation of plant-based, cell cultured, DNA-altered microbe excrement analogs for dairy protein and other elements are entering the market on big GHG reduction claims based on being made without the cow and the inflated methane CO2 equivalent she has been assigned!

The current standard for methane CO2 equivalency is inflated by orders of magnitude. Dr. Frank Mitloehner has addressed this repeatedly and other researchers back his view with efforts to change it.

As Mitloehner and others point out, climate neutrality should be the goal, not net-zero. Furthermore, the current methane CO2 equivalent is calculated based only on the much greater warming effect of methane vs. CO2. However, the current calculation does not account for the fact that methane is short-lived in Earth’s atmosphere — about 10 years compared with 100 to 100 years for CO2 and other GHG. It also does not account for the cow’s role in the biogenic carbon cycle.

Remember, DMI and company have ignored or embraced this definition. At the same time, the Innovation Center’s data collection of progressive accomplishments are included in the baselines from which new reductions (opportunities) must be found.

These two trains run in opposite directions for a future head-on collision on a mis-aligned track. 

The bigger the perceived GHG problem, the bigger the reduction through technology, and the bigger the monetization of that reduction outside of the dairy supply chain. At the same time, this creates an even bigger problem for farms that are unable to participate in biogas projects, farms that don’t fit the Innovation Center’s 3500-cow-dairy-as-solution template, farms that may be carbon neutral or close to it already.

DMI and company have played fast and loose with the truth. 

Farmshine readers will recall the glaring error reported more than a year ago in the white paper written by WWF for DMI. It showcased these biogas projects and the 3500-cow dairy template it proclaimed could be Net Zero in five years, not 30. 

That paper inflated U.S. Dairy’s total GHG footprint by an order of magnitude! A Pennsylvania dairy farmer brought the error to Farmshine’s attention. In turn, the magnitude of the error was confirmed by Dr. Mitloehner who then contacted DMI. A corrected copy of the white paper magically replaced all internet files with no discussion from DMI or WWF. That number was changed, but all of the assumptions in the paper were left as-is.

Put simply: DMI does not appear to be concerned about inflating the size of dairy’s perceived GHG problem. The bigger the perceived problem, the bigger the reduction that can be monetized, but that is now happening outside of the dairy supply chain. 

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Vilsack is de facto architect as Climate Bill dovetails with DMI Net Zero

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Methane tax exempts agriculture, for now… Meanwhile the energy sector impact will affect farm cost of production

By Sherry Bunting, Farmshine, Sept. 9, 2022

WASHINGTON — Make no mistake about it, the dairy industry via DMI’s Innovation Center for U.S. Dairy — is and has been moving toward a future that rank-and-file dairy farmers have had no real voice in and in many cases are just waking up to.

From the annual World Economic Forum (WEF) meetings at Davos to the UN COP26, high-ranking DMI staff have been at the table. 

In fact, the current U.S. Ag Secretary Tom Vilsack, who President Biden credited for writing the agricultural piece of his Build Back Better campaign platform (same tagline used by the WEF), was the first to announce a Net Zero Initiative during a Senate climate hearing in June of 2019 while he was at the time the highest paid dairy checkoff executive at DMI before round-two as Ag Secretary.

When news of DMI’s Net Zero Initiative spread, farmers were told this would be voluntary, and that DMI was making sure companies understood that it has to be profitable for the farms.

But it is rapidly becoming apparent that requests for on-farm data from milk buyers and co-ops, guidelines for environmental practices under the FARM program are voluntarily mandatory through the member co-ops of National Milk Producers Federation (NMPF) and the privately owned plants that join the alliance and pledge get on board the Net Zero train.

All of this dovetails neatly with the Inflation Reduction Act (IRA) passed by Congress and signed by President Biden in August. Loosely referred to as ‘the climate bill’, NMPF is “thumbs up” on the deal, calling it “a milestone for dairy” as the industry “moves forward.”

(Others in-the-know who wish to remain anonymous call these billions a ‘slush fund’ for Secretary Vilsack.)

During the past 12 to 14 years, DMI has portrayed itself as representing U.S. dairy farmers (because after all, every U.S. dairy farmer pays into DMI, mandatorily by law of course). All the while plotting, planning, partnering and aligning with World Wildlife Fund using the middle of the supply chain as the leverage point to move consumers and farmers to where they want them to go.

They are proud to be working to “get you money” for what you are doing for the environment.

What we hear now is the manure technology and sustainability that checkoff dollars are used to promote brings new income streams to the dairy farm so they are less reliant on the volatile milk price. 

We are told that dairy farmers will make money from manure, from farming the carbon markets, perhaps even farming new climate-related USDA programs some of the $20 billion “for agriculture” will be spent on. 

According to NMPF, this is right in line with where the dairy industry is moving and “supports” the industry’s Net Zero Initiative and “other pledges.”

What pledges?

Did you, Mr. and Mrs. Dairy Producer pledge to do something or agree on the value and cost?

The government is making these pledges in global treaties. The industry as a collective whole through this DMI Innovation Center is making pledges to the investment bankers and global companies who are driving the monetization of climate through ESG — Environmental, Social and Governmental benchmarks.

This all has a very “contractual” feel to it – something that must be measured and recorded and monitored and reported, something that includes various scopes from the center point of one’s business to all of its downstream vendors.

There has been little if any open discussion of parameters, of value, of costs and of consequences. 

There has been little if any democratic process to determine pledge participation. This ESG-driven change is happening at a quickening pace all while most of us don’t know what the acronym stands for, what it means, what it entails, how it is measured, what is its value, who will profit from it, what it will truly accomplish, and how much consolidation it will create of the already consolidating market power in food and energy.

Control of carbon is what we are talking about here, and that means control of life itself.

University of Minnesota economist Marin Bozic mentioned this concern when questioned by members of the House Ag Committee at the farm bill dairy hearing in June.

Processors talked about the ESGs and the downstream impacts of businesses dealing with “Scope 3”. Members of Congress wanted to understand the impact on family farms, and Bozic was asked for his observations.

“In solving the climate, we should not allow the pace of consolidation to pick up in the dairy industry,” he responded.

“Congress should look to the industry for advice on how to make sure smaller family farms are not left behind in implementing the (sustainability) requirements they will need to meet to remain in business. Some of these technologies work better when you have more animals to spread fixed costs over more (cattle),” Bozic observed.

When this question came up a third time in Bozic’s direction, he took another swing, encouraging the House Ag Committee to “help the smaller farms meet these standards that the processors will require over the next 5 to 7 years as far as sustainability. It may be more difficult for some of them to meet that, and I would hate to see increased consolidation pace because of the sustainability standards.”

Does the IRA package do that? A deeper dive is required to fully answer that question. So far, there hasn’t been much open discussion about how these ‘standards’ will affect the farms and how much of these funds go to support vs. monitoring.

Industry insiders from processing to marketing have complained anonymously that they are concerned about what the retailers are expecting, what the largest processors are moving toward.

Some of it seems illogical and counter-productive, they say. All of it is being decided in boardrooms and back hallways – not in an open forum, not in a democracy.

Take for example NMPF’s proclamation that the IRA (climate bill) now signed into law is good for the industry, that the methane tax it includes is harmless and will not affect farmers.

Really? What parallel universe are industry executives living in?

Farms – especially dairy farms – are some of the biggest downstream users of fuel and fertilizer producing nutrient-dense food. If those companies are taxed for methane emissions, with graduated scales based on meeting pledges, farmers downstream from that will be incorporated into these pledged targets.

Who among us believes this won’t affect fuel and energy costs on the dairy farm? How will this impact decisions made about milk transportation, even though farmers pay for the hauling of their milk, ultimately. What are the downstream impacts of this tax? 

Congressional staffers admit the downstream impacts have yet to be calculated, but it has been passed into law.

There’s an even bigger question lurking in the smoke from that backroom where deals are made.

Reading through the Congressional Research Service explanation of the IRA package it’s clear that whether the methane tax does or does not pertain to agriculture is – well – unclear, and highly subjective.

There is zero language to ‘carve out’ an exemption for agriculture and food production. What the language does say is that the methane tax applies to fuel and energy sourced methane emissions because these industries are already required to be monitored for these emissions, and to report them.

Surprise.

Some of the $20 billion in the IRA “for agriculture” will go to EPA and USDA to ‘support’ methane reducing practices – but also to monitor them and develop reporting consistency.

Once measuring, monitoring and reporting of methane emissions occurs consistently in agriculture, it is a small step by a future President or EPA head to slip agricultural methane emissions into the scope of the now passed-into-law methane tax.

Again, no carve-out language in that bill, no specifically mentioned exemption for agriculture or for cattle.

However, interest is growing as a hearing in the Senate Committee on Environment and Public Works Sept. 7 dug into this a bit.

Scott VanderHal, American Farm Bureau Federation vice president was among those testifying Wednesday. The hearing pertained to a series of ‘protective’ bills for everything from livestock to motorsports in terms of the Clean Air Act through which emissions monitoring and reporting falls.

Interest is now even higher for bills like S. 1475 to protect livestock operations from permits being granted based on emissions. This now takes on a whole new meaning when contemplating a methane tax in the IRA package that is – for now – limited to industries that are monitored and required to report.

Expect to see stepped up interest from Farm Bureau as the methane tax falls into EPA’s warm embrace.

In conversations with congressional staffers, it’s also clear that new leadership in Washington, a new Congress, a new President, can make some changes to executive orders that have come to pass under the current administration, but changing the laws that have passed in this Congress will be more difficult.

However, the scope of the implementation process for the IRA funding (2023-26) will be greatly influenced by the 2023 Farm Bill reauthorization. Those funds will not have been spent yet, and can be rescinded or reallocated by Congress to other areas within the 2023 Farm Bill.

These laws are open to interpretation, so the executive branch has the power to take things in a positive or negative direction where agriculture is concerned.

What does all of this mean for dairy farmers?

First, it is possible that a portion of the $20 billion for agriculture and the environment will fund good programs that are positive for farmers and the environment. But at the same time, look at where the emphasis has been on the part of NMPF and the Innovation Center for U.S. Dairy under DMI’s umbrella. 

The emphasis is on revenue streams for dairy farms from something other than milk. The emphasis is on digesters and renewable energy. The emphasis can also be on regenerative agriculture, but this is an area that doesn’t produce much profit for others, so will it gain traction?

What happens when these government billions and industry / checkoff pledges become embedded at the farm level? What happens to the farms of the small to mid-sized scale under 3000 cows that are not going to be able to capitalize on the California goldrush to RNG fuels from methane digesters?

As good as digester technology can be in the situations where it provides positives – it is not the panacea, and it leaves most of today’s dairy producers on the sidelines from a revenue standpoint, while setting a standards bar that they may or may not be able to reached by other means – and should they have to honor these pledges they did not make?

In many cases, obtaining a milk market may rely upon participation in these pledges, which means small to mid-sized processors outside of the 800-lb gorilla are beginning to sit up and take notice too.

Yes. This most definitely impacts dairy. The industry via DMI and NMPF and their partners say dairy is moving forward to embrace the Vilsack ‘slush fund’ the Congress and President Biden have made available. They call it a partnership.

Instead of government rules, you, Mr. and Mrs. Dairy Producer are getting government help, support and partnership. You are getting a government that sees the value in what you are doing and will pay you for it. 

That’s what we are being told, but we aren’t being told about the monitoring and reporting and the consequences thereafter.

NMPF says the $20 billion for agriculture in the IRA will assist and support and partner with farmers to value their sustainability. That is all well and good until the carrot transforms into a stick. It all depends on where the drivers of the pledges are going.

Can we please have an open discussion of the pledges before making them?

My advice for farmers? Do what is good and right for your farm, for your community, your animals, the environment around you, within your means, and yes, government programs that help cost-share a beneficial practice are a good thing, a win-win.

But when the talk turns into pledges and deadlines and terms that sound contractual, beware. 

When asked for proprietary information about your farm, ask the asker how it will be used and what its value is. Ask for this in writing. Don’t sign anything without taking time to understand it or have an attorney perhaps review it.

When you are asked tough questions about your farm, ask the questioner tough questions about why they want to know.

Be polite, engage in a discussion, and make them explain it. Then tell them you’ll want to think it over. 

President Ronald Reagan said it best. “The top nine most terrifying words in the English Language are: I’m from the government, and I’m here to help.”

As much as we may want to believe the collective “they” are here to help, take nothing for granted.

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Our farmers are the thin green line between us and a ‘Holodomor’ – Let’s not forget it!

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Bale art in Holland has a message. Displays like this are a ‘public-friendly’ way to protest the nitrogen (emissions) policy, and the red handkerchief has become the sign of support for farmer resistance.

By Sherry Bunting, Farmshine, July 22, 2022

The pain is necessary. The transition is unavoidable. The climate pledges are urgent. Race to zero. Net Zero Economy. Sustainable Nitrogen Management. Climate Champions, and on and on. 

These are just some of the pages and phrases at the United Nations Environmental Program (UNEP) website where resolutions are adopted, targets are pledged, sustainable development goals (SDGs) are constructed and updated, and Environment, Social, Governance (ESG) scoring is discussed for countries, cities, corporations, lenders, investors, institutions, states, provinces, networks, alliances, even individuals.

Dairy farmers are being asked to provide more and more of their business operations data, field agronomy, feed and energy purchases, inputs, output, upstream, downstream — a virtual farm blueprint.

While it is important that farmers have a baseline to know where they are and gauge where they are going, it is also critical that such details do not provide a centralizing entity the ability to map them into zones where requirements are passed down by milk buyers, government agencies, industry programs, or lenders deciding farmers in Zone A will be held to one standard while farmers in Zone B are held to another. 

Meanwhile, even the most aggressive standard is so trivial in the big picture that it is offset virtually overnight by unrestrained pollution in countries like China where no one is minding the store.

Sound familiar? Look at The Netherlands.

Activist NGOs have struck deals with everyone from the billionaire globalists, activist politicians, industry organizations, corporations and investors to create the world they envision and have invested in for a future return.

They use marketing platforms, global PR firms, thought-leadership networks, pre-competitive alliances, pseudo-foundations and even align with government agencies to flesh out the details and drive the bus.

As producers and consumers, it feels like we are along for the ride.

For example, Changing Markets Foundation, an offshoot of World Wildlife Fund, partners with NGOs to “leverage market forces to drive rapid and self-reinforcing change towards a more sustainable economy.”

It was formed to accelerate this transition.

Just this week Changing Markets published a study taking aim at dairy – warning investors to take a more active role in improving the dairy and meat sector’s “climate impact” by asking these companies, the processors, to disclose their emissions and investments and cut methane and other pollutants.

In other words, the NGOs, through a ‘marketing’ foundation, prods investors to push your milk buyers, lenders and vendors to obtain and track for them your information.

These NGOs and foundations are driving this bus a little too fast, and it needs to slow down. They take countries (like Holland) to court to hold up infrastructure projects, using their own pledged targets against them and forcing a faster timetable to gain the offsets needed for the stalled projects.

They publish self-fulfilling studies, surveys and warnings prodding investors to reach back into the dairy and meat sector and take a more active role in getting more reporting of downstream methane emissions (your farm).

They warn dairy and meat processors that if they don’t get this information and cough it up, investor confidence will be harmed and their assets could be stranded, resulting in large economic losses.

They salivate with anticipation, waiting for land purchase packages that they, as NGOs, can poorly manage as contractors alongside the purchasing government entities.

Let this sink in. The investor class is being deemed the farmer’s new customer – not the consumers whom our farmers are proud to feed and proud to show the truly valuable practices they use in caring for the land, practices that are often not very well monetized – like cover crops, for example.

If a country like the Netherlands with a progressive agriculture industry finds itself in the position that it can’t build or do infrastructure projects without first decreasing nitrogen emissions on the backs of farmers, where do we go from here with the fuzzy math being done on all greenhouse gases in the sidebars of highly-capitalized alternative meat and dairy lookalikes that are lining up — ready to burst on the scene to grab a foothold for investor returns?

The Changing Markets report, in fact, makes the claim that 37% of global GHG comes from food production and attributes most of this to meat and dairy — certainly embellishing the issue in this disingenuous phrasing and fuzzy math.

If farmers can’t be paid for the simplest of constructive practices that produce food for people — while at the same time being restorative to the land, why should billionaires and governments be able to come in and buy their land, plant trees, re-wild to scrub brush or half-hearted grassland status and get an offset?

None of what is happening makes sense unless we step back and recall what we know about the World Economic Forum’s Great Reset, Food Transformation, Net Zero Economy and the realities of so-called ESGs. This has been a process and most of us have only had glimpses of it to connect the dots.

I recall conversations over the years of my journalism career with a most respected ag economics professor, the late Lou Moore at Penn State. He worked with farmers and his peers in former Soviet countries after the breakup of the Soviet Union. He would tell the stories from Ukraine, described to him as handed down through generations of the period of terror and famine known as the Holodomor when the Soviets collectivized the farms of the Ukraine under communism – resulting in the starvation and death of 10 million or more in a transition.

Bottomline: Agenda 2030 has been under construction for some time now, and ‘climate urgency’ is being used today to target farming and food production, not just energy and fuel.

Our industry organizations keep telling us the public, consumers, are driving where this is going, that it is science based, and yet key questions at the farm level still can’t be answered.

At the regional levels, we see authentic models of conservation groups partnering with dairy farms and cooperatives to access grants for meaningful improvements that make financial and environmental sense but may not show up just so on a global NGO’s master sheet. 

There are ideas being generated to give companies of all sizes a way to be ‘climate champions’ by investing in Farm Bill conservation programs that really work. Congressman G.T. Thompson mentioned this recently at a farm meeting.

Let’s do the work that accomplishes what’s real and equitable for our farmers and hold off just yet providing too much detailed information.

We know NGOs and governments have set targets to protect 30% of the earth’s surface as non-working lands by 2030 and 50% by 2050. This boils down in the targets at the U.S. level as well.

Let’s be sure we don’t give away the farm.

The strength and diversity of our farmers is so important. You, our farmers worldwide, are the thin green line between us and a Holodomor.

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For farming to flourish, liberty is essential

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By Sherry Bunting, Farmshine, July 1, 2022

As our nation commemorates Independence Day, we think of America’s agrarian roots and how an agrarian himself, Thomas Jefferson, the primary architect of the language so carefully chosen in our Declaration of Independence, wrote much on the subject of agriculture.

With all that is happening in the world, and in agriculture, now is the time to really ponder our nation’s birth. Liberty has proven for almost 250 years to be more than an ideal worth fighting—even dying—for. It is a condition of life in America that can be misunderstood and taken for granted.

The battle of Gettysburg, the turning in the tide of the Civil War marks this same spot on the calendar. This too is remembered every July 4th weekend with re-enactments on sacred ground where freedom was further fortified for all, lest we forget that our unity stood the test of valor and dignity from both sides—an internal struggle to recommit our nation to the freedom and responsibility of true liberty so that…

As President Abraham Lincoln said: “These dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom and that government of the people, by the people, for the people, shall not perish from the earth.”

From East to West and North to South, the diverse beauty of both the land and people of our United States of America move us to do the work, the caretaking.

Diversity, too, is a key attribute of liberty.

Across the long rural stretches of prairie from the Midwest through the Great Plains—where one can go hours without seeing another vehicle—the bigness of this land and its call of freedom is, itself, liberating.

Whether it is the eastern patchwork of small farms living at the fringes of suburbia with subdivisions often sprinkled between them or the western stretches of uninterrupted farmland—we have a duty to protect America’s agriculture, the quiet essential role of family farms as the backbone of our nation’s liberty.

We can’t allow global business interests and elitists to dictate from afar, to turn our rural networks that need restoring and rebuilding into food deserts.

Thomas Jefferson once said that, “The earth is given as common stock for man to labor and live on.” He also held high the value of agriculture to the nation’s economy, which remains true centuries later in 2022.

“Agriculture is our wisest pursuit because it will, in the end, contribute most to real wealth, good morals and happiness,” Jefferson wrote.

These are not idle words. In today’s times of rapidly advancing technology, many of us lack a full understanding of how advancing technology can coexist with the essential simple goodness of the sustainability we need—that of families farming for generations in the U.S. being able to choose their path instead of having it chosen for them, with new generations staying in farming or leaving to do other important work even as new and beginning farmers are drawn to the land.

Liberty is essential for agriculture to be that beacon. No other profession sustains our communities like agriculture, multiplying earnings throughout local communities.

The billionaires at Davos know this. The global corporations taking over all sustenance, they also know this. Real riches begin with the soil, the land, the work, the families, the food that sustain us.

Ralph Waldo Emerson observed: “The glory of the farmer is that, in the division of labors, it is his part to create. All trade rests, at last, on his activity. He stands close to nature; obtains from the earth the bread, the meat. The food which was not, he causes to be.”

Science, itself, is being misused, along with our faith in doing good, feeding the hungry, caring for the earth and for others, giving God the glory. The challenge is to retain our independence, remember our nation’s birth and what it stands for and never take for granted our agrarian roots, so essential for our future.

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Deals with the devil at Davos; it all comes down to money… and land

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WEF panel at Davos on redirecting capital in agriculture. (screen capture)

NEWS / ANALYSIS

By Sherry Bunting, published in Farmshine Newspaper, June 10, 2022

DAVOS — Let’s follow your checkoff money all the way to Davos, where Klaus Schwab and friends, known as the World Economic Forum (WEF), gather annually in Switzerland. This is where globalist elites have been plotting and planning the net zero economy, complete with food transformation maps.

On May 26, your message was delivered and your future was signed up, with your money through your checkoff programs — a plan 14 years in the making under the DMI umbrella of multiple so-called non-profit foundations and alliances.

Some of the same global actors in the WEF food transformation movement are also represented in the various non-profit alliances that were created by your checkoff in the 2008 through 2012 time-period.

At Davos, the May 26 panel on “redirecting capital in agriculture” is where “farmers voices were heard for the first time,” they said.

Don’t worry, the purpose was to get you the money from Davos billionaires to do all the things they will be requiring you to do to be part of the new net zero economy they are creating with the net zero goal DMI has set for you — despite the fact you didn’t vote on it or sign up for it, and experts can’t even agree on what it means or how it will be measured.

But that’s okay, your checkoff created surveys, sustainability platforms and strategic alliance non-profits to bring the largest processors together “pre-competitively” to set the timelines, plan the parameters, and craft your messages.

DMI “thought leaders” often talk about getting ahead of “societal issues” such as animal care and the environment via the Innovation Center — to avoid regulation. That is the basis of the FARM program, for example.

But the reality is the regulatory side has at least some accountability — a process via our democratic republic if we still have one. 

What democratic process was used to determine the rules your farm will live by — as decreed by the corporations buying what you produce, and now also the access to capital you will need to continue?

Consumers have not asked for this, and neither have you. But your checkoff has done it for you and will help you navigate.

DMI issued a press release just a few days before Davos about how the Sustainability Summit they held state-side to help you, the farmer, navigate this new future they have been creating with your checkoff money.

“Never has the opportunity been greater for us to come together and demonstrate our collective impact,” said DMI CEO Barb O’Brien in opening the pre-Davos Summit. “And frankly, never has it been more urgent as we work to meet the growing demands and expectations of both customers and consumers around personal wellness, environmental sustainability and food security.”

These are pretty words.

The press release cites the U.S. Dairy Stewardship Commitment as having 35 companies representing 75% of the milk market signed on. The four pieces DMI is working on were listed in a vague way: 1) utilizing new ‘digital frontiers’ for point-of-purchase ‘strategies’, 2) promoting a new definition of ‘health and wellness’, 3) fulfilling an ‘impact imperative’ they say exists among consumers positioning U.S. Dairy as the leader in addressing societal challenges such as climate change, and 4) targeting ‘inclusive relevance,’ which O’Brien said Gen Z is the driver as the most diverse generation to-date with societal expectations for companies and brands.

Two weeks later, the thought leader representing you in Davos told the gathered elite, the billionaires, the power-centers, that your soil has “perpetual societal value” and should be invested-in and traded as an “asset class,” that farmers are the “eco workforce to be deployed,” and that investors and lenders should “redirect capital” to “de-risk” the investments farmers must make as “climate warriors that are planting the future.”

We missed that memo. Lots of buzz terms here, so let them sink in.

Here’s the reality: Farmers’ voices were NOT heard in Davos. Instead, what was heard was the voices of the WEF billionaires, the WWF supply-chain leveraging model, the string-pullers (thought leaders), and the plan-developers. 

The World Wildlife Fund 2012 “Better Production for a Living Planet” identifies the strategy depicted in this graphic on biodiversity (30×30), water and climate. Instead of trying to change the habits of 7 billion consumers or working directly with 1.5 billion producers worldwide, WWF stated that their research identified a “practical solution” to leverage about 300 to 500 companies that control 70% of food choices. By partnering with dairy and beef checkoff national boards in this “pre-competitive” strategy, WWF has essentially used farmer funds to implement their priorities in lockstep with the World Economic Forum. Image from 2012 WWF Report

We don’t even know all the tentacles behind the pretty words used to describe what you have already been signed up for. Rest assured, DMI will roll them out gradually through the Innovation Center and FARM, and investors, lenders and others will put them in the fine print of farmer access to capital and markets.

It’s more truthful to say the farmers’ voice is being stolen in this process.

Your autonomy, independence and decision-making is being overridden. Your permission is being granted for the WEF Davos billionaires to step right up, help themselves, and determine your options, your future through their investments in a soils asset class — because, climate.

During the WEF panel, it was Erin Fitzgerald who carried “the farmers’ voice” to Davos.

Erin Fitzgerald (USFRA photo)

Fitzgerald is CEO of U.S. Farmers and Ranchers in Action (name changed in 2020 from the previous U.S. Farmers and Ranchers Alliance). She became the USFRA CEO in 2018 after spending the previous 11 years working for DMI as Vice President of Sustainability and several other roles and titles while the FARM program and net zero framework was being developed. She spoke “for farmers and ranchers” in four sessions at the WEF annual meeting in Davos, including one panel about redirecting capital in agriculture, where she talked about soil as an “asset class” and farmers as the “eco workforce.”

During her comments on the Davos panel about “redirecting capital,” she made it clear that your consumer is “no longer the person at the checkout” in the grocery store. She said it’s the pension fund investors looking for low-risk investments. 

Even that is not entirely accurate. The truth is that DMI — in the creation of its many precompetitive alliances — has its sights set on bigger fish: the billionaires at Davos, the venture capitalists, the global corporations investing in climate. 

In fact, this is being driven behind the scenes by Edelman, the global PR firm that receives $16 to $18 million in checkoff funds annually as the contractor for DMI over the past decade of plotting and planning. Edelman is a key player at Davos. GENYOUth was the Edelman brainchild, and outgoing CEO Alexis Glick was originally tapped by Richard Edelman, himself, to lead GENYOUth as a former financial analyst who made Davos a high point of her itinerary.

Back to the WEF panel on May 26 — the messages that have been crafted were touted, along with a narrative about what you will do in the next 30 harvests as the “eco workforce” of the “new global net zero economy.”

Listening to some of the livestreamed sessions, other panels highlighted the future of food, energy and financing to all be rooted in carbon impact.

Some panels noted the fast pace of the WEF global transformation is creating inflation pain, but the globalist elites are not concerned, even saying “that’s a good thing.”

Other panels delved into individual carbon tracking, to measure, record and score what each one of us eats, where we go, how we get there.

Truth be told, consumers are also being signed up for the net zero economy, although most don’t even know it yet. In a free America, I’m not sure we voted on this global-control-fast-track either.

Fitzgerald, whose role is described as “building sustainable food systems of the future,” laid it out for the crowd of investors, corporations, regulators, and government officials.

On the Davos stage, she said she brought the farmers’ message and referred specifically to the DMI board chair as “my chair Marilyn, a farmer from Pennsylvania.” (Marilyn Hershey also sits on the USFRA board.) 

In the ‘redirecting capital’ discussion, another layer of the World Wildlife Fund (WWF) model of leveraging the few players in the middle of the food supply chain to move consumers and producers at both ends was very much in play.

This is not surprising. The DMI alliance with WWF also spanned a 12-year period from 2008 to 2020 when all of these non-profit alliances were formed under the DMI umbrella to bring global processors together as a platform for “pre-competitively” determining how all farms will operate in the future.

Your innovation and hard work were mentioned, but no credit was given to where you are, what you already accomplish, as farmers. It is all forward-looking to annually “make progress” over “the next 30 harvests.”

The stage was set for farmers to see capital “redirected” to de-risk certain types of operations and to make the soil you farm an “asset class.”

“We officially have our first solution,” declared the Davos panel moderator, turning to the panelist sitting beside Fitzgerald, saying “that’s your area, let’s do it.” Who was this panelist? None other than David MacLennan, the board chair and CEO of Cargill, and a former member of the Chicago Board of Trade and Board of Options Exchange.

Think about this for a moment. Soil as an asset class dovetails nicely with the 30 x 30 land grab, another WEF / WWF / Great Reset / Build Back Better invention.

Lured by money or financing, the soil you farm — if it becomes a tradable asset class with financing channeled to certain practices begs this question: Whose land does it become and what will be your accountability through the Security and Exchange Commission or the Commodity Futures Trading Commission for disclosures? Farm Bureau is already sounding the alarm on proposed rules about supply chain producers being an open book to the SEC for claims made by companies buying their raw commodities.

More importantly, who will make the decisions on your farm? Fitzgerald asked the audience to “put aside the term ‘farmer’ and think about ‘these people’ as the “eco workforce.’”

Your voice, through your checkoff, just went into the den of thieves to offer your land, your future, your autonomy — as a farmer, rancher, landowner, generational steward of God-given resources in your community — and put it on a silver platter for the Davos global elites under the feel-good message of farmer as climate warrior, an eco workforce planting the future in the net zero economy.

They said your voice was heard, your story was told, and they’ll get you the investment funds for projects. In  “thinking about soils as a perpetual asset to society,” Fitzgerald said investors can do what was done for the renewable energy sector in 2008 to “prop it up and get it moving.”

“This eco workforce has boots on the ground,” she said. “They have every bit of capability, but they’re going to be battling the real effects of disrupted markets and climate change, and they also have unbelievable talent. Our farmers are doing amazing work as climate eco warriors. Are we as business agents of change here at Davos really creating the finance models to de-risk their investment to let them plant the future and be the eco warriors they can be in the fight on climate change?” 

More pretty words that might sound inspiring to some, until we pull back the layers and realize deals are being made with the devil.

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Dr. Mitloehner clears the air on ‘net zero,’ sees narrative changing on America’s cows

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Dr. Frank Mitloehner is a foremost authority on animal science and greenhouse gas emissions. Find him on Twitter @GHGGuru and @UCDavisCLEAR (Screen capture from American Dairy Coalition webinar)

‘Climate neutrality, not net zero carbon, should be dairy’s goal.’

By Sherry Bunting

‘Net zero’ seems like a simple term, but it’s loaded, according to Dr. Frank Mitloehner, professor and air quality specialist with the Department of Animal Science at University of California-Davis. 

He firmly believes dairy can be a climate solution, but the first step is to accurately define dairy’s contribution to the climate problem. Setting the record straight is his prime focus, and he also researches ways dairy, like every industry, “can do our bit to improve.”

Presenting on what ‘net zero’ really means for dairies, Mitloehner answered questions during the American Dairy Coalition (ADC) annual business meeting in December, attended by over 150 producers from across the country via webinar.

Based in Wisconsin, ADC is a national producer-driven voice with a regionally diverse board. President Walt Moore, a Chester County, Pennsylvania dairy producer, welcomed virtual meeting attendees, and CEO Laurie Fischer shared a federal dairy policy update. 

She said the ADC board is nimble, moves quickly, and wants to hear from fellow dairy farmers. She encouraged membership to make ADC stronger and shared about the organization’s federal policy focus in 2021 — from pandemic disruptions and assistance, Federal Order pricing, depooling and negative PPDs to real dairy label integrity, whole milk choice in schools, and farmers’ questions and concerns about dairy ‘net-zero’ actions.

“Too often, farmers think they may not understand something, so they don’t speak up,” said Fischer. “But we get calls and so much great advice from our farmers. We know you get it, you know it, because it is happening to you.” 

From this farmer input, the net-zero topic became the ADC annual meeting focus.

“We are rethinking methane, and this is influencing and shaping the discussion,” Dr. Mitloehner reported. He urged producers to use the information at the CLEAR Center at https://clear.ucdavis.edu/ and to do better networking, to have a better presence on social media. 

This is necessary because the activists are well-connected, and methane is the angle they use in their quest to end animal agriculture. He said Twitter is a platform where many of these discussions are happening. His handle there is @GHGGuru and the Center is @UCDavisCLEAR.

“This is something I have told the dairy industry. They say ‘net-zero carbon’, but they shouldn’t say that because it is not possible, and it is not needed. We need to be saying ‘net-zero warming’. That’s the goal. Then, every time you reduce methane, you instantaneously have an impact that is inducing a cooling effect,” said Mitloehner.

‘Climate neutrality’ is the more accurate term he uses to describe the pathways for U.S. dairy and beef. But it requires getting accurate information into policy in a fact-based way. 

It requires arming people with the knowledge that the constant and efficient U.S. dairy and livestock herds produce no new methane, that they are climate-neutral because not only is methane continuously destroyed in the atmosphere at a rate roughly equal to what is continuously emitted by cow burps and manure, that process involves a biogenic carbon cycle in which the cow is a key part.

One of the issues is how methane from cattle is measured, he said. Current policy uses a measurement from 30 years ago that fails to acknowledge the carbon cycle and ‘sinks’ alongside the ‘emissions.’ 

Mitloehner said accurate information is beginning to change the narrative. This is critical because methane is the GHG of concern for dairy, and the narrative about it has been incomplete and inaccurate. 

As a more potent heat-trapping gas than carbon dioxide, methane becomes the ‘easy’ target to achieve the warming limits in the Paris Accord. Methane was the focal point of ‘additional warming limits’ during the UN Climate Change Summit (COP26) in Glasgow in November.

Putting together the inaccurate narrative alongside international agreements to specifically reduce methane, it becomes obvious why cattle are in the crosshairs. Producers are already in the middle of this in California as methane regulation and carbon credit systems began there several years ago.

As the narrative is beginning to change, Mitloehner sees opportunities. He described the current California ‘goldrush’ of renewable natural gas (RNG) projects where large herds both in and out of state cover lagoons to capture and convert biogas into RNG. The state’s investments and renewable fuel standard provide a 10-year guarantee with the RNG companies typically owning the offset credits that can be traded on the California exchange from anywhere.

Getting the numbers right is mission-critical

“We are far and away an outlier because of our efficiency in the U.S with all livestock and feed representing 4% of the GHG total for the U.S,” Mitloehner confirmed. “Dairy, alone, is less than 2% of the U.S. total.”

This is much smaller than the 14.5% figure that is thrown about recklessly. That is a global number that includes non-productive cattle in India as well as the increasing herds in less efficient developing countries. This number also lumps in other things, such as deforestation.

He said the true global percentage of emissions for livestock and manure is 5.8%. Unfortunately, activists and media tend to use the inflated global figure and conflate it with these other things to inaccurately describe the climate impact of U.S. dairy and livestock herds as 14.5%.

The efficiency of U.S. production and the nutrient density of animal foods must be part of the food and climate policy equation.

Methane is not GHG on steroids

“Without greenhouse gases, life on earth would not be possible because it would be too cold here,” said Mitloehner. “We need GHG, but human activity puts too much into the atmosphere, and the toll is large concentrations.” 

The way all GHGs are measured has to do with their intensity as determined 30 years ago when scientists wanted one global warming potential (GWP) unit to compare cows to cars to cement production and so forth. They came up with GWP100, which converts methane to CO2 equivalents based on its warming potential.

Methane traps 28 times more heat than CO2, but it is short-lived, Mitloehner explained.

“Looking just at the warming potential, you get this idea that methane is GHG on steroids and that we need to get rid of all of it and all of its sources,” he said.

But is this the end of the methane story? No.

Sinks and cycles must count

Mitloehner described how ‘methane budgets’ look at sources and their emissions but ignore the carbon sinks that go alongside and ignore the chemical reactions that result in atmospheric removal of methane as well.

“Plants need sunlight, water, and a source of carbon. That carbon they need comes from the atmosphere to produce oxygen and carbohydrates,” he said, explaining how cows eat the carbohydrates and convert them to nutrient dense milk and beef. In that process, the rumen produces methane.

“Is this new and additional carbon added to the atmosphere? No it is not. It is recycled carbon,” he said.

“Say you work off the farm. You drive and burn fuel, adding new CO2 in addition to the stock in the atmosphere the day before. Stock gases accumulate because they stay in the environment. Currently, agencies treat methane as if it behaves the same way. But methane is a flow gas, not a stock gas. It is not cumulative,” said Mitloehner.

If the same farm has 1000 cows belching today and 1000 belching 10 years ago, those 1000 cows are not belching new methane because in 10 years it is gone from the atmosphere. It is cyclical.

“The take-home message is the carbon that our constant livestock herds produce is not new carbon in the atmosphere. It is a constant source because similarly to it being produced, it is also destroyed. The destruction part is not finding its way into the public policy system… but it will in the future,” he predicts.

Methane drives Paris Accord and COP26

Methane targets are driving intergovernmental agreements wanting to limit the “additional warming impact” of nations and industries.

Currently, cattle are viewed as global-warmers because they constantly emit methane. However, as Mitloehner drilled numerous times, this is not new methane, it is not additive, it is not cumulative. It is recycled carbon.

“If you have constant livestock herds, like in the U.S., then you are not causing new additional warming,” said Mitloehner.

Burning fossil fuels is much different. 

“Fossilized carbon accumulated underground. Over 70 years, we have extracted half of it and burned it, so where is it now? In the atmosphere. We added new and additional CO2 that is not a short-lived gas. It is a one-way street from the ground into the air,” he explained.

The problem for dairy and beef producers is their cattle are being depicted as though their emissions are additive, cumulative, like fossil fuels, which is not true, he said.

Signs the narrative is changing

One promising sign that the message is getting through has come from Oxford researchers acknowledging the constant cattle herds in the U.S. and UK are not adding new warming.

They acknowledge the GWP100 “grossly overestimates” the warming impact of cattle and are working on a new measurement that recognizes constant cattle herds are not adding new warming, said Mitloehner.

Another promising sign is that the International Panel on Climate Change (IPCC) issued a statement recently acknowledging that the current GWP100 overblows the warming impact of cattle by a factor of four. This new information is not in current policy, but it is making its way there.

Tale of two bathtubs

Mitloehner believes it is important to visualize climate neutrality. He described two bathtubs. One has a CO2 faucet with no drain, the other a methane faucet with a drain. Open the faucets, and even at a slow and steady rate, the CO2 bathtub continues to rise, while the methane bathtub drains as it fills to remain at a constant level.

He also explained that over the past 200 years the U.S. hasn’t seen any real change in that methane bathtub because prior to settlement in America, 100 million ruminants — buffalo and other wild herds — roamed. Today, there are around 100 million large ruminants in the U.S. dairy and beef industries.

What has changed is the U.S. does have more liquid manure lagoon storage that is producing more methane than solid manure storage. “But we know of ways to further reduce that,” he said.

Mitloehner pointed out how the current GWP100 poorly estimates the warming impact three example scenarios. If, over 30 years, methane is increased 35% from a source, or reduced 10%, or reduced 35%, the GWP100 would show significant continuous addition of cow-sourced methane in CO2 equivalents for all three scenarios because the destruction of the methane – the drain that operates with the faucet – is ignored.

The proper way to look at this, if the methane increased a lot, is that it would add a lot. But if it is balanced, then there is no new or additional warming. And, in that third scenario, he said, “where we pull a lot from the atmosphere when we reduce methane, it has the same impact as growing a forest.”

Bottom line, said Mitloehner, “We can be a solution and take it to the market and get paid for that,” but current policy does not yet reflect the neutral position of the constant and efficient U.S. herd.

Bullish about the future

‘Net zero’ is a term that is not yet clearly defined, said Dr. Frank Mitloehner several times during the American Dairy Coalition annual meeting by webinar in December. He sees the real goal as “climate neutrality,” to communicate the way constant U.S. dairy herds contribute “no additional warming,” in other words “net zero warming.”

The climate neutrality of U.S. cattle must be part of public policy, he said. Only then will dairies truly be on a path to marketing their reductions as ‘cooling offsets.’

Mitloehner, a University of California animal scientist and GHG expert is bullish about the future of “turning this methane liability into an asset, so if we manage toward reducing this gas, we can take that reduction to the carbon market,” he said.

“When we hear ‘net zero’, we think about carbon, but that would mean no more GHG is being produced, and that is not possible. I have told the dairy industry this for years. Why is (zero GHG) not possible? Because cows always belch, and we can’t offset that, and furthermore, we do not need to offset that because it is not new methane,” said Mitloehner.

On the other hand, “If we replace beef and dairy made in the U.S., this does not create a GHG reduction at all. This is because we are the most productive and efficient in the world,” he said.

Just stopping beef and dairy production here in the U.S. — and picking up the slack by producing it somewhere else or producing something else in its place — creates ‘leakage.’ This leakage, he said, is where the biogenic carbon cycle becomes disrupted. In other words, the bathtub has a faucet that is out of sync with the drain.

California’s RNG ‘goldrush’

Mitloehner touched on the strict California standards that mandate a 40% reduction of methane be achieved by the state by 2030. Again, methane is targeted because of its warming potential per the Paris Accord.

The good news, he said, is California is using incentives to encourage covering manure lagoons to capture a percentage of the biogas bubble so that it doesn’t go into the atmosphere but is trapped beneath the tarp and converted into renewable natural gas (RNG) that can be sold as vehicle fleet fuel to replace diesel. 

Because this RNG comes from a captured and converted methane source, it is considered a most carbon-negative fuel in the state’s low-carbon fuel standard. 

Those credits equate to $200 per ton of CO2 replaced with a carbon-negative renewable, said Mitloehner.

“This is a huge credit. This is why dairies are flocking to get lagoons covered to trap and convert. These credits are guaranteed for 10 years in California, but the anti-agriculture activists are fuming over them,” said Mitloehner.

Of all California investments made toward achieving the 40% methane reduction goal, dairy has received just 3% of funds, but has achieved 13% of reductions so far.

This “carrot” approach has incentivized the biogas RNG projects assuming $4000 income per cow, making an estimated $1500 to $2000 per cow per year on a 10-year California fuel standard guarantee.

Mitloehner noted that the carbon intensity of the reduction is presently viewed as greater when RNG is used in vehicles vs. generating electricity, but right now there is not enough RNG suitable for vehicle use. He sees the fuel use increasing in the future and explained that dairies anywhere can sell into the California market if they capture biogas and convert it to RNG.

The state’s 10-year guarantee has stimulated companies seeking to invest in RNG projects on large dairy farms, where they then own or share the credits.

Mitloehner answered a few questions from producers about the caveats. If the bottom and top of the lagoon are covered, what happens to the sludge that accumulates? He acknowledged there is no satisfactory answer to that question presently.

Another drawback is the technology only works for larger dairies because smaller lagoons won’t have the same breakeven. Community digester models are emerging as well, he said, but they also use clusters of large farms working together.

Soil carbon sequestration

Mitloehner cited soil carbon sequestration as a way dairy farms of any size can be a solution.

It’s the process by which agriculture and forestry take carbon out of the air via the plant root systems that allow the soil microbes to take it into the soil — unless the soil is disturbed by tilling or it is released through fires. With good forest and grassland management, as well as low- and no-till farming practices, carbon can be sequestered to stay in the ground forever, according to Mitloehner.

“Agriculture and forests are the only two ways to do this,” he said, adding that USDA seeks to incentivize practices that take and keep more of the atmospheric carbon in the soil.  

Answering questions from producers, he noted that he has not yet seen a scheme that would incentivize soil carbon sequestration through marketing offsets, but the discussions are heading in that direction.

“Many of the environmental justice communities are running wild on this. They do not want farmers to get any money for it. They are putting on significant pressure and threatening lawsuits, so it’s not settled yet,” he reported.

There is also a lot of confusion around soil carbon sequestration and “regenerative” agriculture. One big problem is that producers who are doing some of these things, already, won’t get the opportunity to capitalize on those practices when offset protocols are eventually developed — if those practices are not deemed “additive.”

“If you are doing something now and are not covered by a policy of financial incentive, then four years from now, if it is developed, they’ll say you don’t qualify because you are already doing it,” said Mitloehner. 

“They are calling it ‘additionality.’ It’s about the change to doing it to qualify. That seems crazy, but it’s like if you bought an electric vehicle 10 years ago when there was no tax credit, you don’t get a tax credit now for already owning an EV because the improvement is not ‘additional,’” he explained.

What about the burps?

For farms with under 1000 cows, other technologies like feed additives can be used on any size dairy with effects realized within a week, said Mitloehner, noting one product that is commercially available and several others on the docket.

If a 10 to 15% reduction can be achieved in enteric (belching) methane reduction, then it will be marketable. Right now, these reductions are not marketable. If an offset protocol is developed for this in the future, it will be taken to the carbon market, he said.

In the meantime, incentives are being offered within supply chains, according to Mitloehner. Companies like Nestle, Starbucks and others are doing pilot projects and buying feed additives for the farmers within their supply chains to reduce their products’ GHG. He said there is some evidence these products can enhance components and feed efficiency. This is a big area of research right now.

A question was also asked during the webinar, wondering about Amish farms using horses instead of tractors. Are they contributing to cooling?

Mitloehner replied that he has not yet seen a calculation for this, and while the impact of horses would be less than the impact of burning fossil fuels, there is still an environmental impact to calculate. 

Since the international focus is on ‘additional warming impact’, methane is – like it or not — the target. Whether a dairy farm is managed conventionally or in the Amish tradition, the cows, the methane, and how governments and industry measure the ‘additional warming impact’ of cow-sourced methane, is still the crux of the issue for all dairy farms. If efficiency is reduced, then the ability to position the dairy farm as ‘cooling’ may be more complicated, or less significant, he said.

In addition to accurate definitions that acknowledge climate neutrality of constant cattle herds producing no new methane, Mitloehner’s wish is for federal policy to also take productivity (and nutrient density) into stronger consideration when evaluating emission intensity “instead of just counting heads of cattle. 

“This can be good for large or small dairies with a high or low footprint. When the relative emissions are determined by how you manage the dairy, the hope is that this is more about the how than the cow.”

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DMI’s DS4G sees dairy feed, cropping, cow care as ‘big hammers’ for net-zero

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‘Grant’ will start ‘measuring’ air, soil around dairy cropping practices in nine U.S. regions

This is the third and final part of the multi-part series about DMI’s Net Zero Initiative and Dairy Scale for Good implementation. Parts one and two in Farmshine covered some of the 12- to 13-year history, the ‘scale’ approach for getting the industry to net zero faster, and the impact of manure processing, digester models, and renewable energy policies and technologies in the NZI scheme.

By Sherry Bunting, Farmshine, May 7, 2021

ROSEMONT, Ill. — How dairy feed and forage are produced are the “biggest hammers” that are “ripe for innovation in dairy emissions reduction,” said Caleb Harper, executive director of DMI’s Net Zero Initiative (NZI) Dairy Scale for Good (DS4G) implementation.

He and Dr. Mike McCloskey, chairman of the DMI Innovation Center for U.S. Dairy’s Sustainability Initiative, presented information about the Net Zero Initiative (NZI) and ‘implementation on the farm’ during last month’s Balchem real science lecture series.

Much of the presentation used the ‘spreadsheet exercise’ of the World Wildlife Fund (WWF) white paper laying out the “business case for getting to net zero faster”, based on a 3500 cow dairy (a Fair Oaks site with 3000 milking and 500 dry). In fact, Harper’s DS4G work will exclusively pilot and model on dairies about this size.

After explaining that the DS4G goal is to make maximum impact on the entire supply of milk in the short-term using “the consolidation going on in the industry” and the idea of “scale to drive down the risk … and spread the benefit across the industry,” Harper dug into each area and showed how the models tend to work best when multiple areas are combined.

Harper said no till farming, cover crops, innovative crop rotations, renewable fertilizer, precision agriculture all fall into this feed production area of emissions.

“It all boils down to measuring the emissions,” he said, showing a slide of boxes in potato fields in Idaho, where USDA ARS has a project that monitors the air around the crop to show the emissions from a field and mitigation that can be attributed to cropping practices. He said DMI has a grant to do the same thing with dairy cropping practices beginning this year.

The key, according to Harper, is to show that the emissions are being reduced. In addition to boxes in fields measuring emissions around crops, Harper said soil core samples will be taken to determine carbon sequestration of dairy feed cropping strategies.

“This is open science, (meaning still in the proving stage),” said Harper, known for his Open Ag science project growing food in computer controlled boxes at M.I.T. That project ended amid controversy last April a few weeks before Harper was hired by DMI to lead its NZI DS4G.

During the real science lecture in April, Harper said DMI has a grant program starting this year, along with Foundation for Food and Agriculture, to do this type of field box emissions monitoring and soil core sequestration monitoring across nine different U.S. geographies to test conservation tillage practices in terms of carbon emissions and sequestration over the next five years.

Harper said he sees this area as “huge” for innovation and for generating carbon credits that are valued by markets and for reducing one-third of dairy’s ‘field to farm’ emissions while improving soil health and the ability of soil to hold water.

He projects the bottom line potential annual farm revenue on this at $70,000, saying the industry will have to combine this with other strategies, like manure processing, renewable energy generation and such to get the combination of environmental impact toward ‘net-zero’ GHG and the economic revenue stream impact for the dairies.

“Some strategies are more impactful than others,” he said about the WWF models.

In this diagram, which was also shared by DMI leaders in a Pa. Dairy Summit breakout session about what dairy checkoff has done for producers lately, Harper illustrated how WWF models show farms will have to combine areas to merge emissions reduction potential with revenue potential. This shows feed production represents 26% of field to farm emissions reduction potential but just 3% of farm revenue potential; Cow care encompassing feed additives, efficient rations and genetics represents 33% of emissions reduction potential and just 5% of farm revenue potential; but conversely, renewable energy production on the farm represents just 5% of emissions reduction potential and 23% of farm revenue potential.

The ‘hammers’ on the emissions side do not line up with hammers on the revenue side, and the question remains, where will individual dairy farms sit in terms of decision-making as supply chains scale these combinations.

Yet again, the question arises around selling or monetizing the carbon credits generated by the farm once these cropping practices are “measured” and added to models. How does the sale of these credits, or bundling with sales of milk, then change the carbon profile of the farm selling the credits vs. the buyer in the dairy supply chain. Again, as mentioned in Part II on manure technologies and energy generation, this is an important detail that the WWF, NZI and DS4G modeling has not dealt with or worked through.

So, while discussions have already progressed to model how carbon credits and milk could be bundled to milk buyers, with pilots funded by supply chain grants to model how scale can spread impact over the industry and the entire milk supply, the holes in the value proposition are more obvious in this area where farms are already doing great things for land, air and water, by keeping something green and growing on the land as part of dairy feed production: How do farmers get credit for what they are already doing?

Harper also said “amazing things” are happening in the feed additive aspect of reducing enteric emissions, but he acknowledged “it’s early” on the carbon credit side for that.

This area of feed production and feed additives in the DS4G ‘value proposition’ has been spreadsheet-modeled to account for one-third of dairy’s field to farm CO2 equivalent emissions, and yet, at the same time, carbon credits based on this area are still in the research and measurement stage, needing documentation to be ‘monetized.’ 

Harper cited an example paper from University of California-Davis showing significant reductions in enteric emissions in beef cattle with certain feed additives.

As this work in the area of feed production and feed additives continues, said Harper: “Continuing to optimize rations (for production efficiency) remains important, while feed additives and selecting genetics for lower emissions will become important.”

Author’s Notebook:

The WWF Markets Institute released the dairy business ‘case study’ for scaling to net-zero faster on Jan. 27, 2021. A mid-February Farmshine report revealed the WWF mathematical error that had inflated the magnitude of CO2 equivalent pounds contributed by all U.S. milk production. WWF on Feb. 25, 2021, corrected its baseline to show the much smaller collective impact of 268 billion pounds CO2 equivalent (not 2.3 trillion pounds).

Both Harper and McCloskey serve on the WWF Market Institute’s Thought Leadership Group.

DMI confirms that dairy checkoff had a memorandum of understanding (MOU) with WWF from the inception of the Innovation Center for U.S. Dairy around 2008 through 2019. McCloskey has chaired the Innovation Center’s Sustainability Initiative since 2008.

In 2008-09, two MOU’s were signed between DMI and USDA via former U.S. Ag Secretary Tom Vilsack — the Sustainability Initiative and GENYOUth. At the end of the Obama administration, Sec. Vilsack was hired by DMI dairy checkoff to serve as president and CEO of USDEC 2016-2021, and earlier this year he became Secretary of Agriculture again after President Joe Biden said Vilsack ‘practically wrote his rural platform and now he can implement it.”

Aside from both serving on the WWF Market Institute’s Thought Leadership Group, McCloskey and Harper have another connection. According to the Sept. 2019 Chronicles of Higher Education, Caleb Harper’s father, Steve Harper, was a grocery executive. He was senior vice-president of marketing and fresh product development, procurement and merchandising from 1993 to 2010 for the H-E-B supermarket chain based in Texas. According to a 2020 presentation by Sue McCloskey, H-E-B was their first partner in the fluid milk business in the 1990s, followed by Kroger. According to the Houston Chronicle, the McCloskeys also partnered with H-E-B in 1996 during Steve Harper’s tenure to produce Mootopia ultrafiltered milk, an H-E-B brand. This was the pre-cursor to fairlife, the ultrafiltered milk beverage line in which DMI invested tens of millions of dollars in checkoff funds through the Innovation Center for U.S. Dairy partnering with the McCloskeys, Select, and Coca Cola.

Harper also previously served as a member of the Board of Directors for New Harvest for at least three years (2017-19). New Harvest is a global nonprofit building the field of cellular agriculture, funding startups to make milk, meat and eggs without animals.

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DMI’s NZI DS4G eyes climate policies, supply chain partners in net zero fastlane: but who gets the carbon credits?

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Author’s Note: This is part two in a multi-part series about DMI’s Net Zero Initiative and Dairy Scale for Good implementation. Part one previously covered some of the 12- to 13-year history as well as the ‘scale’ approach for getting the industry to net zero faster. 

By Sherry Bunting, Farmshine, April 30, 2021

ROSEMONT, Ill. — The official launch of DMI’s Net Zero Initiative (NZI) in October 2020, and World Wildlife Fund’s (WWF) dairy net zero case study published in January 2021 (and corrected in February for a math error that overestimated the industry’s total CO2 equivalent emissions) are two of the mile-markers in farm visits and partnership development since Caleb Harper was hired by checkoff in May 2020 as executive director of Dairy Scale for Good (DS4G).

In those 11 months, Harper reports visiting 100 dairy farms representing over 500,000 cows in 17 states, processing 350 manure samples, and gathering over 8000 ‘data points.’

Earlier this month, Harper, along with Dr. Mike McCloskey, presented a “value proposition” for the dairy industry during a Balchem real science lecture about ‘net zero carbon emissions implementation on the farm.’

McCloskey of Fair Oaks Farm, Fairlife and Select Milk Producers has chaired the DMI Innovation Center for U.S. Dairy’s Sustainability Initiative since inception 12 to 13 years ago.

In short, DS4G pilots are setting up through “sponsorships” from large dairy-buying partners on large farms within their own supply chains. DMI’s former MOU sustainability partner, the WWF, makes the case in its report that “achieving net zero for large farms is possible with the right practices, incentives and policies within five years (by reducing) emissions in enteric fermentation, manure management, feed production and efficiency, and energy generation and use.”

“This value proposition for dairy cuts two ways,” said Harper. Farms of 2500 cows or more can go toward digesters tied to renewable fuel production, while farms 2500 cows and fewer can move toward a digester model that handles food waste, receives tipping fees and generates electricity.

Both models will depend on a combination of government subsidies, low carbon renewable fuel standards, electrification of the U.S., supply chain sponsorship and sale of resulting carbon-credits, according to information presented by Harper and McCloskey.

NZI aligns with climate policies announced and anticipated from the Biden administration, which mirrors what is coming out of the United Nations’ Food Summit, and World Economic Forum (WEF) Great Reset.

WWF has long been tied closely with WEF setting a global agenda and with the World Resources Institute (WRI) that evaluates science-based targets for companies making net zero commitments to “transform” food and agriculture.

“Innovative models are just now starting to bear fruit,” said Harper, citing McCloskey as a forerunner of “building out” the anaerobic digester concept.

For his part, McCloskey said they “counted on incentives” back in 2008 to be able to grow and “be the catalyst.” He talked about a future sustained by marketing the new products created as substitutes for fossil fuels, mined fertilizers and other products, as well as continuing to take in other carbon sources instead of landfills.

“We have the vision to set this all up, to perfect the technology and get it cheaper… so when we’re all doing the same things, incentives won’t be needed,” said McCloskey looking 10 to 20 years down the road when he sees this “surviving on its own.”

Harper described distributive models from the WWF report. One “being born” in California incorporates separate large scale dairies in a cluster – up to 20 or 30 farms within a 20-mile radius — each with its own digester that can “drop compressed methane into a transmission line to a centralized gas cleaning facility.” In this model, dairies either have a manure or land lease contract or an equity position in the operation.

This model, he said, relies on “societal values of green energy.”

Another distributive model being born in Wisconsin is described as a central digester with adjacent gas cleaning and upgrading. In this model, the manure from multiple farms is sent to the centralized digester by pipe or truck.

“These dairy clusters become ‘green’ clusters,” Harper elaborated. “So, it’s not just about the milk. They become a primary source of green energy inside of a state or nation.”

Food waste co-digestion is part of a different DS4G model driven by states adopting regulatory policy to keep organic material out of landfills. Harper said dairy farms can take advantage of such policies by centralizing waste collection for co-digestion.

“As we think about reducing emissions… a big part of that is bringing things grown off farm on farm, destroying their greenhouse gas potential, and taking credit for that ‘sink,’” Harper explained. 

However, in this example, the co-digestion is what gives the dairy its carbon credits, so technology that can handle higher waste-to-manure ratios and state / local regulations allowing farms to handle the off-farm waste are necessary. Such details were not discussed by Harper, and are presumed to be what large scale dairy pilots address.

The WWF case study showed bottom line profit and loss of $500,000 annually for a 3500-cow dairy. Harper believes this is a “conservative” estimate based on electricity production. With the right policies in place, the renewable natural gas value proposition would produce higher returns, according to Harper.

The renewable natural gas market will still be building over the next five to 10 years, he said, so these models also rely on renewable fuel credits and other fixtures they expect to be part of the Biden administration’s climate policies.

Manure handling technologies apart from the digesters were also discussed, which according to the WWF case study, represent one-third of both emissions-reduction and income potential.

Harper is actively engaged in studying the differing chemical profiles of manure between farms, regions, and states — saying he wants to “understand manure” — with and without digester.

Looking at scale, Harper talked about adapting municipal human waste treatment systems for processing manure on large dairies. He highlighted what is called the “omni processor” — a Bill Gates investment to separate small scale municipal waste and create drinking water using a spindle with multiple discs heated to where nonvolatile solids are in the dry matter and the rest are captured as they volatize.

One “off the shelf technology” Harper is focusing on is already in use to produce discharge quality water. It is the membrane system of ultrafiltration (UF) and reverse osmosis (RO) — the same UF RO technology McCloskey pioneered in milk processing to remove water from milk for transport and refine elements for value-added products.

Stressing the large amount of water in dairy manure, Harper said UF RO “is a process designed exactly for de-watering.” Whether this process occurs before or after the digester, he said it is part of “the technology train, so whatever you are tagging onto is working more efficiently, processing less water and more nutrients and refining more things to find value in.”

All of these technologies, according to Harper, can build on each other and tie together with “electrifying” the United States, strengthening low carbon renewable fuel standards, adopting renewable fertilizer standards, and monetizing carbon. 

One unsettled aspect in this regard, however, appears on page 9 of the WWF case study and was not mentioned by McCloskey or Harper in their presentation. 

What happens to farmers when their carbon reductions and removals become part of the supply chain in which they sell their milk, or are sold to companies as part of a milk contract?

The WWF report makes this observation: “There could be significant interest from large dairy buyers in reducing embedded carbon in their products by purchasing value-added carbon ‘insets’ directly from farmers or cooperatives within their supply chains. Were companies to work closely with the dairy industry to advance these initiatives and enable greater GHG reductions, they could potentially use these measures toward meeting their own reduction targets … and incentivize dairies to embrace net zero practices through long-term contracts or other purchase or offtake agreements.”

That’s an aspect of the tens of millions of dollars in dairy pilot partnerships pledged by Nestle, Starbucks and potentially others for their own supply chains through DMI’s NZI DS4G.

WWF explains further in its report that, “Such agreements could provide stability and collateral as dairies consider investing in technology like anaerobic digesters. Some of these companies might even be interested in finding ways to bundle and purchase carbon credits produced on dairy farms where they buy milk.”

Such incentives, contracts and bundling – starting with DS4G pilots — leave dairy farms exactly where in the supply chain?

The WWF report states it this way: “Such purchases would shift the emissions reductions from the farmer to the company. This would result in the dairy essentially selling the credits that would enable its net zero status, as the emissions reductions cannot be double counted. 

“So, if the reductions are sold, the farmer can no longer be considered net-zero. This is a conundrum that is beyond the scope of this paper,” the WWF report admits.

This important detail in the NZI DS4G implementation was not mentioned by Harper or McCloskey.

Meanwhile, these initiatives also rely on climate policy, with former DMI executive Tom Vilsack now having crossed back over into government as U.S. Ag Secretary just 20 months after seeking pilot farm funding and Net Zero target policies when he testified before the Senate Ag Committee in June of 2019 while employed by checkoff as CEO of the U.S. Dairy Export Council.

President Joe Biden has said USDA is a key department in his administration’s climate action policies.

To be continued

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2021 WWF / DMI ‘Net Zero’ report inflated GHG baseline for total U.S. milk production

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By Sherry Bunting, Farmshine, Feb. 26, 2021

EAST EARL, Pa. – At a time when dairy producers are in the fight of their lives to prove how sustainable they already are in providing nutrient-dense milk and beef from the much-maligned bovine, they can ill-afford publication of overblown climate data on total U.S. milk production. And yet…

Dairy producers have unknowingly paid to applaud, promote and contribute to inflated baseline greenhouse gas (GHG) emissions data via their own national dairy checkoff.

The Jan. 27 report, produced by DMI’s former MOU partner World Wildlife Fund (WWF), established a GHG baseline that has been confirmed and admitted as being mathematically wrong by an order of magnitude — 10 times greater than reality.

So egregious is the mathematical error inflating dairy’s baseline GHG emissions, that the entire WWF / DMI Net Zero Initiative ‘Dairy Scale for Good’ case study is now questionable in the significance of its reductions because the significance of the starting-point — the ‘problem’ — is overblown.

Since receiving the DMI press release and copy of the 14-page white paper on Feb. 1, we have been reviewing it. The WWF Markets Institute ‘white paper’ entitled An Environmental and Economic Path Toward Net Zero Dairy Farm Emission” has been widely promoted by DMI. 

Its case-study model was concerning to us initially because of its narrow representation of comparable dairy farms and grand claims about what is needed for large farms to be “net zero in five years” and selecting pilot farms for the industry to prove-out the model.

Yes, the report was produced by WWF, but in a recent Pa. Dairy Summit breakout session on “What dairy checkoff has done for you lately,” DMI president Barb O’Brien confirmed that the WWF report is being promoted because it supports the Net Zero Initiative launched by DMI’s Innovation Center for U.S. Dairy.

More importantly, she said the report is a “spreadsheet exercise” that will now be piloted on large farms by Dairy Scale for Good executive director Caleb Harper to see if the exercise can be “proved out.” An exercise, mind you, that has inflated the significance of the problem it is purporting to solve. 

In the same “What has dairy checkoff done for you lately” session at Dairy Summit, O’Brien said the data for the WWF white paper came from DMI input!

This emperor has no clothes. This dog doesn’t walk. This math does not “add up.” 

We are talking about the math that established the baseline GHG for all U.S. milk production used to determine the significance of the reduction from the ‘Net Zero’ dairy case study, a 3000-cow Fair Oaks-style dairy, that does not represent reality for many large and small dairies in various geographies. But at the same time overblows the level of the problem everyone else contributes to.

We weren’t the only ones struggling to make sense of the WWF / DMI white paper. A Pennsylvania dairy producer did the math using his bulk tank calibration conversions and brought the “immense blunder” to Farmshine’s attention. 

He was concerned about what this means for all dairy farms, stating in an email: “Why would anyone set a specific reduction amount when it can be demonstrated that the starting amount is wrong? DMI may wish to partner with someone with better math skills.”

The producer who wished to remain anonymous pointed out to us in his email – and we agree – that DMI may want to get their facts straight with a Net Zero Initiative that shows this level of baseline blunder. In fact, as the producer observes: “If the objective (as indicated in the WWF report) is for a 10% reduction from the inflated number, then hallelujah! The EPA numbers show a 90% reduction (already — across all milk production).”

Could the inflated GHG baseline have been intentional? After all, that inflated number is instrumental in bolstering the significance of a prescribed ‘case study’ reduction for which pilot farms are being selected to ‘prove out’.

An inflated baseline harms all dairy farms because it does not reflect the truth about how small the GHG emissions really are – already — for all milk produced on all U.S. dairy farms, under sustainable dairy farm conditions, right now!

In fact, when the Pa. dairy farmer who alerted us to the math error supplied his figuring for the CO2 equivalent (CO2e), his figures put the inflation error at 8.6 times greater than reality.

We sent a media inquiry asking GHG expert Dr. Frank Mitloehner of University of California-Davis CLEAR Center to review the WWF report and let us know what we might be missing in our calculations.

Dr. Mitloehner agreed that the starting point for GHG emissions in the WWF / DMI report was off by “an order of magnitude”. 

We asked him for his expert review and on Wednesday, we received a copy of a letter Dr. Mitloehner sent to WWF. In it, Mitloehner references the white paper’s value of 2.3T pounds (trillion pounds) of GHGs as the emissions from total U.S. milk production (page 7 of the WWF white paper).

“When I went over your calculations, I noticed some potential errors. My own estimate arrived at GHG emissions that are about 10 times lower than the number you reported,” Mitloehner wrote in his letter to WWF.

“Assuming the conversion of the annual milk production in 2018, using Thoma’s equation, into kg fat-and-protein corrected milk (FPCM) and then changing to gallons of FPMC, my calculated values come out to be 287,453,374,279 (287 billion) pounds (not 2.3 trillion pounds),” 

GHG expert Dr. Mitloehner writes. “Using GHG emissions of 10.6 lb CO2e per gallon FPCM, the total GHG come out to 2.87453E+11 lbs CO2e. To simplify the number using the Tera unit prefix, the GHG would be 0.287T pounds CO2e, which differs significantly from the aforementioned value (in the WWF white paper) of 2.3T pounds.”

In his letter, Mitloehner emphasized that the WWF / DMI report was “very informative and points toward solutions that are attainable and scalable, both of which are considerations desperately needed as we look at feeding people in a sustainable manner.”

However, he adds, “I do worry that if the calculations are incorrect, it could lead to misinformation and confusion.”

Along with a copy of his letter to WWF, Dr. Mitloehner included in his email reply to Farmshine the WWF response thanking him for bringing it to their attention. 

“There is indeed an error and we are in the process of fixing it and will have an updated PDF soon and will share it with you, and we will fix the links on the website,” wrote Katherine Devine, director of business case development for WWF Markets Institute.

Once again, a climate-focused NGO with global goals against animal agriculture overblows GHG emissions from cattle, in this case dairy cattle. But this time, it happened within the full purview of mandatory producer-funded dairy checkoff.

 The reason this is a big deal is that it is being used to set policy. The DMI and WWF press releases point to this report as being based on “stakeholder” data that can “demonstrate what is possible with the right practices, incentives and policies within five years.”

For the four weeks, this WWF report has been applauded and promoted by DMI, using case study data that was contributed by DMI. 

The question now is how did this happen and what will the retraction look like? 

Will anyone stand up for the sustainability of dairy farms as they are – today – for an accurate baseline of their real contribution to GHG emissions, especially per unit of nutrition provided? Where is logic in the overall equation?

Dr. Mitloehner indicated in his email reply that the overblown GHG baseline does not completely jeopardize the paper’s ideas about strategies that can position dairy as a climate solution. However, when the starting math is off by 10 times the true amount, it becomes obvious the larger truth is that dairy is a small emitter and should already be paid for so-called ‘ecosystem services.’ Why is checkoff not pounding that message?

While dairy farms across the U.S. should be applauded and promoted for the reality of how small their emissions are while producing nutritious food for all of us – already – every day, DMI got its focus set on spreadsheet modeling to tell one story when the truth is they could have used accurate numbers to tell a better story.

Instead, the baseline GHG math error undermines the current sustainable performance of all dairy production while putting on a pedestal the Net Zero model based on a 3000-cow Fair Oaks-style dairy with no heifers on site, 80% of forages grown on site, a ration that is 70% forage, and a methane digester mix made up of more than 50% co-digestion of other waste streams.

In fact, some producers of similar size who have inquired about this model, have hit brick walls in having their sustainable practices even considered to  show levels of reduction. No wonder! The starting math for the WWF / DMI model is inflated and banks on that inflation to achieve the “significant” reduction in farmgate pounds of CO2 equivalent (CO2e).

While the math is muddy, the problem here is clear. Cattle as contributors to climate change continue to get a black eye by those inside and outside the industry overblowing the problem to push a marketing agenda that fits a global transformation narrative.

(POSTCRIPT NOTE: Just this morning after Farmshine went to press, we notice the PDF file at the WWF link (previously called ‘version 9’) has been quietly replaced with a file noted in its name as ‘v.10’. In it, on page 7, the total U.S. milk production GHG baseline of 268 billion pounds CO2e now appears where 2.3 trillion pounds once stood. No other change or discussion. We’ll be following up to do comparisons of how the smaller baseline impacts the significance of sweeping transformation, including calculations per unit of nutrition vs. other foods in next week’s Farmshine.)

Connecting dots:

— The January 27, 2021 WWF white paper uses a Fair Oaks-style 3000-cow Net Zero dairy case study. The WWF report was produced by the WWF Markets Institute and was written by WWF Markets Institute senior vice president Jason Clay, Ph.D.

— Clay heads the WWF Markets Institute Thought Leader group. According to the WWF Markets Institute website, the Thought Leader group members include DMI Innovation Center for U.S. Dairy Sustainability Alliance chairman Mike McCloskey of Fair Oaks fame, along with May 2020 DMI hire Caleb Harper serving as Dairy Scale for Good executive director.

— Harper started with DMI a few weeks after his departure from the MIT Media Lab under a cloud of press reports raising questions about aspects of donations, performance and environmental compliance within his digital food research project at MIT. For three years prior to being hired by DMI, Harper served on the board of directors for New Harvest, an organization that supports research and promotion of cell-cultured fake animal protein with the tagline ‘meat, milk and eggs without animals.’

— According to a Sept. 2019 Chronicles of Higher Education article, Harper’s father Steve was a grocery executive, senior vice-president of marketing and fresh product development and procurement from 1993 to 2010 for the H-E-B supermarket chain in Texas and northern Mexico and stayed on part-time through 2012 before retiring.

— During that time, H-E-B became the first and longstanding partner of Mike and Sue McCloskey when they were dairying in New Mexico and founded Select Milk Producers. Sue explained this in her presentation at the 2020 Pennsylvania Dairy Summit, that the H-E-B alliance was instrumental and painted a picture of how it progressed to dairy’s future as seen by DMI’s Innovation Center for U.S. Dairy and its food industry partners, with Mike serving as chair of the Sustainability Alliance.

— According to a June 15, 2014 Houston Chronicle article, the McCloskeys worked with H-E-B, supplying their milk and in 1996 producing Mootopia, the ultrafiltered milk H-E-B store brand and pre-cursor to fairlife, now solely owned by Coca Cola.

— During a February 2021 zoom presentation at the 2021 Pa. Dairy Summit, DMI’s vice president of sustainability Karen Scanlon confirmed that DMI had an MOU partnership with WWF from the inception of the Innovation Center for U.S. Dairy in 2008-09 and that this partnership opened doors with companies on shared priorities over the past decade. The MOU between DMI and WWF expired in 2019 and was not renewed, but Scanlon confirmed that a close relationship and exchange of information continues.

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