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Who Decides How Much We Pay for Milk?

By David Goodman, "Who’s Milking It? ," July/August 2010

Are farmers getting a fair deal?


READER'S COMMENT:
"Very well written and informative. I come from a family of dairy farmers that have been in the business over 150 years. Today, my grandmother told me there is a high possibility that my uncle will have to sell the farm due to the terrible...

DFA controls about one-third of the U.S. milk market, and is the primary milk supplier to Dean Foods. Dean Foods controls about 40 percent of the national milk supply, about 60 percent of organic milk and 90 percent of soymilk (Dean brands include The Organic Cow, Horizon Organic, Garelick Farms, Dean’s and Land O’Lakes, to name a few). Dean Foods spokeswoman Liliana Esposito insists, “Dean Foods is not a monopoly that ‘controls’ any market. We buy less than 15 percent of the nation’s raw fluid milk supply from only 9,000 of the 58,000 U.S. dairy farmers.” But according to U.S. Senators Bernie Sanders (I-VT), Russ Feingold (D-WI) and Chuck Schumer (D-NY), Dean Foods controls about 90 percent of the market for fluid milk in Michigan, 80 to 90 percent in Tennessee, 80 percent in Massachusetts and 70 percent in New England.

In 2009, as the price paid to dairy farmers for their milk fell by 41 percent, Dean’s profits soared 147 percent over the previous year. Between July 2007 and June 2009, when farmers saw their milk earnings drop by nearly half, the price of milk in stores only dropped 18 percent.

As Senators Sanders, Feingold and Schumer wrote to the Justice Department last year, “Many of us in Congress believe that preservation of family-based agriculture is vital for the prosperity of rural America and our country as a whole. Many of us also believe that consumers throughout the country want the opportunity to purchase fresh, high-quality, and locally produced food…. Dairy farmers [should] be able to sell their product at a price that they deserve.”



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