Contact
Diane Bothfeld, Deputy Secretary
802-828-3835
diane.bothfeld@state.vt.us

On August 3, 2011, the Vermont District Court approved the Dean Foods Settlement involving the price of Grade A milk produced and sold in the Northeast.  The class action antitrust lawsuit brought by a class of northeast dairy farmers against Dean, Dairy Farmers of America (DFA) and Dairy Marketing Services (DMS) was filed in August of 2009.  The  farmers reached a settlement agreement with Dean Foods Company in December 2010, including $30 million in monetary damages.  The final settlement had to be approved by the federal court, which has taken over 7 months.

In the final settlement, the Court awarded all of the Plaintiffs’ costs of $1.5 million but only awarded $4.5 million in fees, out of the $8.5 million requested by the attorneys for the plaintiffs.  Thus, the attorneys will get $6 million or 20% of the settlement amount, as opposed to the 33% requested.  The Court denied the requests for incentive awards for the class representatives and an award of accrued interest on the settlement fund.  Consequently, approximately $24 million will be provided to eligible dairy farmers in the defined class.

All past and present dairy farmers in Vermont should have received a mailing regarding this settlement and the deadline is approaching for dairy farmers to determine if they will take part in the settlement or not.  “It is important for all Vermont Dairy Farmers to carefully consider their options regarding this settlement, “ stated Deputy Secretary Diane Bothfeld.  Dairy farmers’ legal rights are affected whether or not they act.  Information, claim forms and a clear description of the settlement is available at www.NEDairySettlement.com or you can call

1-888-356-0258 for information.   If you wish to receive a payment from the Settlement you must complete and return a claim form and state the amount of Grade A milk produced and pooled in the Northeast between January 1, 2002 and May 23, 2011. The form is due by August 23, 2011.  The settlement forms are very straightforward and most farmers should be able to complete them without outside assistance.

The Vermont Office of the Attorney General reviewed the settlement and monitored the proceedings, and in a letter to the Court did not object to the settlement.

VTDigger

Jersey cows heading up the lane. VTD/Josh Larkin

RUTLAND – The two dairy farmers who fought Dean Foods in federal court and won a preliminary $30 million class action settlement with the nation’s largest dairy processor are disappointed with the non-monetary results of the agreement. The plaintiffs from Vermont and New York state sought injunctive relief, or a stop to Dean’s alleged collusive business practices. They also hoped, in the course of litigation, to expose the history of the company’s dealings to public purview.

Neither of these objectives was achieved by the preliminary settlement agreement, according to the plaintiffs’ lawyer, Kit Pierson. The Vermont Attorney General’s office, which issued an opinion on the settlement, largely aligned with the plaintiffs’ stance.

An attorney for Dean Foods said the company had done nothing wrong.

The plaintiffs and the defendants were in U.S. District Court in Rutland on Monday to make their arguments at a “fairness” hearing before Judge Christine Reiss, who approved the initial settlement between Dean and the farmers in May.

Reiss said she hopes to make a final decision on the terms of the agreement within 30 days.

The monetary award, which is to be divided among 9,000 farmers in New England and New York state, now seems small in light of another recent Dean Foods settlement: The corporation settled a similar case with farmers in Tennessee for $140 million last week.

Paul Friedman, the attorney for Dean Foods said the plaintiffs received a “substantial recovery,” particularly in light of the plaintiff’s “fundamental theory,” which was that Dean Foods “hatched a conspiracy” to artificially deflate the price it paid to farmers for milk. “We don’t think they can prove it,” Friedman said.

In both the Vermont and Tennessee cases, court records have remained sealed, as neither lawsuit has gone to trial. Because Reiss decided to bifurcate the Vermont lawsuit, it is possible the second part of the complaint, which is directed at Dairy Farmers of America and Direct Marketing Services, could go to trial if Reiss certifies the class. (Hood, a regional processor, was originally named in the lawsuit; Reiss threw out the complaints against that company.) DFA and DMS have not agreed to a settlement with the plaintiffs. The question of class certification was supposed to be taken up at the hearing, but because one of the attorneys for DFA and DMS wasn’t present, the decision was delayed.

Read VTDigger.org’s story about the preliminary settlement.

The original Vermont complaint alleges that Dean, Dairy Farmers of America and Direct Marketing Services conspired to create a closed market that kept milk prices artificially low. Lawyers for the plaintiffs have said the three entities created an unfair system where farmers had no choice but to go through a middleman to sell to the biggest milk buyer in the region. Dean owns Garelick Farms, Borden and Horizon Organic.

Download a copy of the complaint. Dean lawsuit

Attorneys for Dean Foods argue the corporation has done nothing wrong and the settlements reached in Vermont and Tennessee in are not admissions of guilt.

The court asked the Vermont Attorney General’s office to evaluate the settlement in light of the Tennessee case. Elliot Burg, an assistant attorney general, wrote that he was concerned that the plaintiffs in Allen v. Dean Foods are receiving substantially less compensation. “Plaintiffs in the Southeast litigation will receive approximately 9 times the amount of money based on volume of milk produced, or 11.5 times more money based on the number of farmers,” according to a statement from Wendy Morgan, chief of the Public Protection Division of the Vermont Attorney General’s office.

Vermont Attorney General’s July 15 letter to Hon Christine Reiss

Vermont Attorney General’s letter to Hon Reiss _ Allen v Dairy Farmers of America Inc

Burg noted that the plaintiffs in the Northeast settled within a year of litigating, and “prior to any discovery being taken from Dean.” In the Tennessee case, the settlement was made on the eve of a trial, after four years of litigation.

If the Vermont case isn’t settled soon, it’s possible Dean Foods could fail, “in which case no dairy farmers will recover anything,” according to Burg. That’s because the company’s stock prices have continued to fall. Since 2006, the value of Dean’s shares have dropped by more than half. The website Daily Finance reports that Dean is “crippled by debt. It put the Dallas-based company on its list of “10 American Companies That Will Disappear in 2011.”

Alice Allen, a dairy farmer in Wells River, and Ralph and Garrett Sitts, farmers in Franklin, N.Y., expressed their dissatisfaction with the results of the legal contest through their attorney in U.S. District Court in Rutland on Monday.

They are not, their attorney Kit Pierson said, disgruntled about the money. Allen and the Sitts’ sought redress and injunctive relief. The redress, which sugars off to about $3,300 per class action claimant (minus the proposed attorneys’ fees it’s about $2,200), is “barely enough to pay the light bill” for a few months, as one farmer in the audience put it. And injunctive relief, or a stop to the alleged collusionary practices of Dean Foods, Dairy Farmers of America and Dairy Marketing Services, was ruled out as part of the monetary settlement.

“The clients were never in this for the money,” Kit Pierson, attorney for the plaintiffs, told the court. “They stepped up out of real concern about practices that they and we regard as illegal. They want to see changes in the industry to improve the situation for everyone and help farmers get a fair deal, which we’re pursuing in terms of injunctive relief from Dairy Farmers of America.

“One of their goals is to shed light on what is happening in the Northeast and a frustration they’ve had is it’s been hard to get things out in the light,” Pierson said. “In our view, the overwhelming majority of facts in the case should be a matter of public record. There is a lot of talk about farmers against farmers (in this case). Let people see the real facts, then you’ll see a lot less division.”

About 10 farmers filed into the ornate courtroom in Rutland on Monday. The majority sat on the defendants’ side of the room. One of the farmers seated behind the half dozen attorneys for Dean, Dairy Farmers of America and Dairy Marketing Services defended Dean in a speech to the judge.

John Gorton, a farmer from Fairfield, argued that the settlement is potentially detrimental to his business relationship with Dean Foods. He blamed periodically depressed milk prices on the federal milk pricing system and farmers’ tendency to “produce too much milk.”

“My problem with this lawsuit is it does nothing to help me solve the real issue in my industry,” Gorton said.

Paul Friedman, the attorney for Dean Foods, bolstered this argument in his comments to the court. He characterized the milk pricing system as “a creature of the federal government,” a national metrics system that doesn’t “bear any relationship to the costs or market prices for milk.” Friedman accused the plaintiffs of using the courts to change government policy.

“Litigation is a blunt instrument when used to address policy issues,” Friedman said. “It’s important to underscore the issue before the court, which is whether this case is fair and reasonable.”

Gorton strenuously objected to the 33.3 percent fee the plaintiffs’ lawyers had requested. The attorneys for the plaintiffs, who took the case on a contingency basis, are asking for about $10 million in compensation.

Attorney Kit Pierson, who represents the plaintiffs, spent much of the hearing justifying the percentage fee, which he said was based on the time his firm spent preparing for a trial. Though he said the office had reviewed millions of pages of documents from the Tennessee case, it had not begun taking depositions of defendants when the case was settled. Pierson argued that members of the firm had spent dozens of hours in negotiations with Dean and he said they had worked diligently to keep the case from dragging on and becoming, as Judge Reiss put it, “the most expensive case in Vermont history.”

“By the time we sat down, we had done an extraordinary amount of work,” Pierson said. “A good lawyer is prepared to go to trial and a good lawyer is also prepared to settle.”

Reiss replied that most anti-trust cases settle instead of going to trial. Typically, she said, plaintiffs can expect to pay less for cases that are settled well in advance of trial.

VTDigger

Jersey cows in Randolph. VTD/Josh Larkin

Dean Foods, one of the largest milk companies in the world and owner of the Garelick Farms, Borden and Horizon Organic milk brands, is poised to pay dairy farmers in New England and New York roughly between $2,000 and $3,000 each.

The revised settlement approved by U.S. District Court judge Christina Reiss struck a requirement that the milk company buy 10 percent to 20 percent of its milk from independent sources, rather than exclusively from the two major milk cooperatives in the region. Dean Foods does not admit any wrongdoing in the settlement.

Dean Foods isn’t the only player in the milk industry that has faced the legal ire of the region’s dairy farmers. Originally, the lawsuit also named the milk company Hood and the region’s two largest milk cooperatives as defendants. The suit against Hood was thrown out, but dairy farmers still are continuing legal action against the two cooperatives, Dairy Farmers of America and Dairy Marketing Services.

The suit alleges that Dean and the two milk cooperatives conspired to create a closed market that kept milk prices artificially low. Benjamin Brown, one of the lawyers from a Washington D.C.-based firm representing the dairy farmers, said the three entities created an unfair system where farmers had no choice but to go through a middleman to sell to the biggest milk buyer in the region.

“If you lived next to a Dean plant and wanted to sell your milk there, you couldn’t do it without contracting through Dairy Marketing Services as a middleman,” said Brown.

Dairy farmers have few options of where to sell their milk. Many independent milk processors in New England were bought up by Suiza, the milk company that eventually merged with Dean Foods.

Both Dairy Marketing Services and Dairy Farmers of America once had ownership stakes in Suiza. When it merged with Dean, the milk cooperatives exchanged ownership for the milk contracts that dictate that dairy farmers must go through the two cooperatives to sell to Dean. Such an arrangement can cause a conflict of interest and create conditions where the cooperatives don’t have an incentive to bargain for the highest milk prices, said Brown.

“You really don’t have a strong voice for the farmers, and that’s a problem,” Brown said.

Long-held Suspicions

Many dairy industry observers have long suspected that milk prices have been artificially deflated by large milk companies like Dean. The lawsuit is part of a wave of antitrust legislation involving Dean Foods.

Milking time at Island Acres Farm in South Hero. VTD/Josh Larkin

There’s been a shift in tone in the Justice Department, said Mark Kastel, executive director of the Cornucopia Institute, a food industry watchdog. Under the Obama administration, the Justice Department has created a separate office within its antitrust division to handle agricultural cases. The idea of pursing antitrust cases has been unpopular in the Clinton presidency and both Bush presidencies, said Kastel.

“That word was almost expunged from the vernacular of this country,” he said.

Objections Moot

Liliana Esposito, a spokeswoman for Dean Foods, said the milk company chose to settle the dispute in order to move on.

“We’re confident we conducted our business lawfully and fairly,” Esposito said.

But the settlement might have the effect of creating adversaries out of what were close allies. Dairy Marketing Services and Dairy Farmers of America, the two cooperatives named in the suit, had objected to the initial settlement, saying it would have negatively impacted the farmers that are cooperative members.

Meanwhile, some advocates for dairy farmers see the antitrust settlement as a missed opportunity. Peter Hardin, a farmer and the publisher of the dairy newspaper Milkweed, believes the plaintiffs settled for a fraction of what they could have won from Dean Foods. Worse, one-third of that $30 million could be eaten up by legal fees, he said.

“To Dean foods, $30 million is nothing,” Hardin said.

More importantly, the public lost an opportunity at full disclosure of the business dealings of Dean Foods, he said. There long have been rumors of strong-arm tactics against farmers who have gone against the milk company, and a day in court might have brought some sensitive Dean Foods documents to light.

“Go to court, go to court; get some of the documents into the public arena,” Hardin said.

Desperate times

Jersey cows heading up the lane. VTD/Josh Larkin

During the worst days of the recession, milk prices plummeted while production costs soared. Demand for milk exports dropped at the same time that high oil prices and demand for biofuel raised feed prices. For the first time, the organic milk market slowed its growth and organic milk companies began cutting ties with dairy farmers that only recently had been lured into converting to organic. Conventional milk farmers, many who were barely surviving during the country’s boom years, got the brunt of the downturn even worse. The bottom fell out of conventional milk prices as export demand dried up.

Farmers already on the margin suffered greatly in recent years, said Ed Staehr, executive director of NY FarmNet, a farmer-support program connected with Cornell University. The program’s hotline received some 6,000 calls in 2010 from people seeking mental health and financial counseling for New York dairy farmers.

It’s all too easy for a farmer to bring his or her work home, he said. That can be difficult when the farm isn’t doing well.

“You can’t separate the family and emotional issues from the farm,” Staehr said.

The results can be disastrous. Last year in Copake, N.Y., in 2010, a farmer shot half his herd before taking his own life. The farmer chose to shoot only the cows that needed milking apparently because he didn’t know who else would take care of them.

George Beneke was that farmer’s veterinarian. Now retired, Beneke has dealt with many stressed dairy farmers in the region during his 41 years on the job. He was quick to point out that many emotional factors most likely led to the Copake farmer’s choice to take his life, but economic stress certainly played a part.

Beneke had never seen anything like the conditions that have confronted the region’s dairy farmers in recent years.

“It was devastating,” he said. “It was the largest downturn I’ve ever seen.”

Many farmers took the hard times personally, he said. Even though they used good stewardship to boost milk production by one-third from the previous generation, they found themselves sinking deeper and deeper into debt. And this happened during a time when consolidation and suburban sprawl isolated them from their peers.

“They don’t have the community that they used to have. They’re not going to sit around the potbelly stove and discuss the Boston Red Sox and their favorite cow,” Beneke said. “These guys are going it alone and they’re not doing very well.”

An unclear landscape

Milk prices have climbed again, buoyed by an increased demand from countries like China and India for U.S. milk.

But there’s little guarantee the milk market will become much more competitive for New England dairy farmers, even if the pending antitrust actions force Dean Foods to change its business practices.

The milk giant is in trouble, with stock prices dipping from $46 a share in 2007 to just over $7 a share today. Dean CEO Gregg Engles is embattled; he recently was ranked 338th by Chief Executive Magazine, dead last among his peers for wealth creation.

According to dairy industry observers, Dean is trying to sell off what it consolidated under Suiza. Some wonder if the milk giant is making itself more attractive for an eventual sale, but Dean spokesperson Esposito only would say that she had no information to offer about the subject.

Even if Dean loses its grip on the dairy market, that’s no guarantee that the business landscape will get easier for dairy farmers, said Cornucopia’s Kastel. There’s nothing stopping another major company coming in and repeating the same practices that some found objectionable with Dean.

“Meet the new boss. He’s the same as the old boss,” said Kastel, quoting a song lyric from the rock band, the Who.

VTDigger

Senators say dairy industry consolidation hurting farmers

Sen. Patrick Leahy and Sen. Bernie Sanders listen to testimony at the Senate Judiciary Committee hearing on antitrust issues in the dairy industry on Saturday in St. Albans. Photo by Terry J. Allen.

A lack of competition may allow dominant dairy processors to “exert power” and depress the price farmers receive for raw milk, according to Christine Varney, the assistant attorney general for the Antitrust Division of the U.S. Department of Justice, who spoke at a congressional hearing held in St. Albans on Saturday.

The largest dairy processor in the country, Dean Foods, buys 70 percent of the milk produced in the Northeast. Sen. Bernie Sanders, I-Vt., has asked the Department of Justice to investigate the Dallas-based corporation’s alleged anti-competitive market practices.

Sen. Patrick Leahy, D-Vt., who called the hearing as part of a congressional investigation into “anti-competitive” dairy industry practices, asked Varney if that level of industry buying power “bothers” her.

“Competition is not very well served when you have one player in the market who controls 70 percent of the market,” Varney said. “We look very carefully at the activity in a market when you have that kind of dominance.”


Varney explained to the audience of 100 people in the St. Albans City Hall that some dairy processors have become “vertically integrated.” These manufacturers not only process raw milk, but also may own parts of the supply chain “such as distribution of its products or supply of its inputs.”

“Vertical relationships in dairy markets would include, for example, a processor entering into exclusive agreements with a specific cooperative to buy raw milk,” Varney testified.

Varney said her division would pursue an investigation of anti-trust violations allegedly perpetrated by dairy processors and would examine complaints about a lack of transparency in the industry as a whole.

“Transparency is something we all need in order to understand how we can improve the production, the health and life of the dairy industry in the United States,” Varney said.
Leahy and Sanders reiterated that Dean Foods has reaped enormous profits this year at a time when dairy farmers are facing a rip tide of red ink and going deep into debt to stay afloat.

Milk prices, which have reached 30-year lows, hovering in the $11 per hundredweight range are not expected to reach $15 per hundredweight until next summer according to USDA economists.
Meanwhile the cost to produce raw milk in Vermont has remained high – at around $18 per hundredweight – partly because farmers must buy more grain here due to the state’s short growing season.

As a result of this whipsaw of low prices and high costs, agricultural economist Bob Parsons at UVM Extension has said Vermont could lose 150 farms in the coming year.

Willard Rowell, owner of Green Mountain Dairy in Highgate, testified on Saturday that his farm will likely lose $1.6 million this year. He and his family milk 900 cows. Last year their income was $2.5 million.

Paul Doton, who milks about 60 cows with his wife and son on their 200-acre farm in Barnard, says he is scraping by because he sells maple syrup, vegetables and does some custom mowing and snowplowing.

“Without this income, I would already be out of business,” Doton said. “Doton farm, much like many other Vermont farms, cannot hang on much longer. How long can we go on losing $4,500 per month? My answer is – not long at all.”

Dean Foods reported first quarter profits of $76.2 million this year, up 147 percent above its reported earnings in the same quarter in 2008, Sanders reported at the hearing.

Sanders said the corporation paid its CEO, Gregg Engles, $116.38 million over the last five years.

“What we are seeing in recent years is a growing concentration of ownership, specifically in dairy processing,” Sanders said. “According to the dairy industry press, one company, the largest milk producer in America, Dean Foods, controls approximately 90 percent of the milk market in Michigan, about 80 percent of the milk market in Massachusetts, 80 to 90 percent in Tennessee, over 80 percent in northern Alabama, over 70 percent in northern New Jersey and in New England about 70 percent.”

In 2001, Suiza Corp. bought Dean Foods, adopted the company’s name, and formed the largest dairy manufacturing corporation in the United States. The company sells milk and other dairy products under 50 “well-known local and regional brands and a wide array of private labels,” according to its web site.

Sanders asked Varney if she would pick up an investigation into the “far-ranging anti-competitive practices” of Dean Foods and Dairy Farmers of America. The 26-month probe, conducted by career investigators at the Department of Justice, was dropped in 2006.

“It is my understanding that in August of 2006 that team recommended action against some of the dairy industry’s biggest firms, including Dean Foods, Dairy Farmers of America and National Dairy Holdings,” Sanders said. “Unfortunately, under the Bush administration it was kicked over to the political people and they decided not to pursue that investigation or take any action. Can you give us assurance that you in fact will continue that investigation and if it leads you to the conclusion that action should be taken that in fact you’re prepared to take action?”

Varney replied, “I can give you every assurance that any investigation I undertake that leads us to believe there is evidence sufficient to prosecute will be prosecuted. There is no doubt that we will prosecute that kind of activity should we find it.”

The Senate Judiciary Committee will accept written testimony from dairy farmers through Sept. 30 at Dairy_Hearing@Judiciary-dem.senate.gov.

Bob Wellington testifies

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You’ve read the headlines. The dairy industry is in crisis. Milk prices have fallen to 30-year lows. Worldwide demand for cheese and powdered milk has plummeted because of the global recession. Farmers are eating into their equity to survive.

But how bad is it, really?

If you didn’t know any better, you might assume the current downturn is like the others because every few years, the bust cycle recurs: Farmers hit the skids and politicians sound the “crisis” alarm.

Vermont, after all, has been losing dairy farms by the hundreds for decades. We had 11,206 farms in 1947; 4,153 in 1970; and today we’re down to 1,046.

This downturn, however, is different.

Vermont Agency of Agriculture officials, agricultural economists, farmers and suppliers – normally a stoic lot — are uncharacteristically throwing around words like “dire” and “scary.” Rep. Peter Welch told a House agriculture subcommittee that the dairy industry in Vermont is on the “brink of collapse.”
This time around, state officials and economists say even Vermont’s best farmers might not escape unscathed because of the length and severity of the downturn. They worry about the resilience of the industry as a whole.

With milk prices at 30-year lows, farmers are hemorrhaging money. Market predictions indicate they’ll continue to bleed cash until next summer. No one seems to know, at this point, when milk prices will  reach break even, cost of production levels.

“The market doesn’t give any indication of turning around quickly,” says Roger Allbee, secretary of the Agency of Agriculture, Food and Markets.

UVM Extension agricultural economist Bob Parsons says the way things are headed, 150 more farms could go under by next summer. The state has lost 32 farms since January.

In addition to the severe slump in market demand, farmers are spending more than ever to make milk, and to stay in business they’re accruing debt at an alarming rate. At the same time, their assets have dwindled as cow and equipment values have dropped, making it more difficult for them to borrow money.

Here are the factors driving farmers to the brink of insolvency:

• For every $3 gallon of milk, the farmer gets 90 cents. The kicker? That gallon costs the farmer $1.80 to produce. In addition to record low milk prices, Vermont farmers are facing higher-than-ever input costs for grain, fertilizer and supplies. Consequently, the gap between the cost of production and the milk price has grown to unprecedented levels, according to Kelly Loftus, communications director for the Agency of Agriculture.
• Farmers have been losing thousands of dollars each month since the crisis began. The cost estimate used by agency officials is $100 per cow per month. A 120-cow dairy on average is losing $12,000 a month; a 700-cow dairy, $70,000 a month. Total losses since February for farms of this size? $84,000 and $490,000, respectively. Add the basic cost of living for a family, $40,000, to that number and you get the whole picture: Without an outside income, those farms are likely to go $124,000-$530,000 in the hole this year.
• Farmers are eating up equity at an alarming rate. Hundreds of dairies are borrowing more money and restructuring their loans to pay for daily operating costs. Farm Service Agency loan volume is up 60 percent this year; Yankee Farm Credit has loaned 19 percent more this year than last.
• Farmers are juggling bills to stay afloat and that means they have thousands of dollars in unpaid bills. Dairy suppliers, particularly grain dealers, are in a bind. They are carrying, thousands and in some cases millions, of dollars in delinquent accounts receivable. Because most of this debt is unsecured, grain dealers are finding it difficult to borrow more money so that they can extend more credit to farmers.
• There is no end in sight. Prices for milk fell below production costs in December 2008 and plummeted in February to $11-$12 cwt, or hundredweight, the equivalent of 11.6 gallons. The average cost of production is $17-$18 cwt. According to USDA Economic Research Service, prices are not projected to reach break even levels until next summer. ERS predicts the average price next year will be $14.65-$15.65 cwt.

Even interventions from the government – low-interest loans and increased spending on federal commodities — won’t be enough to get farmers over the hump, economists and state officials say.

An amendment from Sen. Bernie Sanders, I-Vt., that passed the Senate, but has yet to be considered in the House, could raise the milk income loss contract, MILC, a subsidy for dairy farmers, by $1.25-$1.50 a hundredweight, but it has yet to pass. An increase would help farmers substantially, but the subsidy would not bring milk prices back up to cost of production levels of $17-$18 per cwt in the near future.

Sanders says he wants to get at the root problem, which in his view comes down to processors taking huge profits as they pay out a rock bottom price to farmers for raw milk. He has called for a Department of Justice investigation into allegations of price-fixing and anti-trust violations by Dean Foods, which controls 70 percent of Vermont’s milk. Sanders says helping farmers get a fair price for their product is the best long-term solution.

For the short term, however, the crisis has not yet been averted.

Last month Secretary Allbee asked a group of dairy processors to help to create an emergency fund for farmers. They expressed little interest. As a stopgap measure, the agency is launching a fundraising Web site

http://www.keeplocalfarms.org, through which officials hope to funnel donations from the public to farmers.

The Agency of Agriculture has also devoted the latest issue of its newsletter to the dairy crisis, and it reads like a survival guide. About half of Agriview is devoted to human services programs for food stamps, fuel assistance and subsidized health care. There is a list of mental health resources, a pitch for a nonprofit mediation service and a story about how to talk to kids about financial problems. Other articles offer how-tos on filing bankruptcy, auctioning cows and equipment and selling development rights. The agency is promoting these measures as a way to keep farms going under extreme circumstances.

“Farmers aren’t proud to be in the news because we need handouts, because we need more subsidies,” says Marie Audet of Blue Spruce Farm in Bridport. “We don’t like that and we don’t think it’s necessary because we grow an awesome product. We do it efficiently and in a sustainable way, and we shouldn’t be in the news because we need subsidies. There’s got to be another way.”

Audet hopes that the nonprofit group she helped to form, Dairy Farmers Working Together, can push legislation that would enable farmers nationwide to engage in a coordinated supply management system that would help to control the amount of milk available on the market. Audet says this is the only way dairy farmers are going to get a fair price for their product.

Ironically, at a time when more Vermonters are concerned about where their food comes from, local farmers that produce milk are under siege.

As Sanders puts it, “You will end up with a situation where consumers will be dependent on very large farms for their milk or perhaps increasingly dairy products coming from abroad. I think that is a very, very unfortunate scenario because in Vermont people are increasingly concerned about the quality of the food products that they’re eating. They don’t want food from farms in China where regulation is very, very weak for example.”

Copyright, Vtdigger.org

See “Dairy: The big picture”

See “Pillar of rural economy”

See “Losses driving farms into debt”

See “Dairy downturn whacks businesses”

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