Organic dairy farmers get a hand
A Holstein calf stands in a stall at Lilac Ridge Farm in West Brattleboro.

Organic dairy farmers get a hand

Dairy farmers in southern Vermont — most of them organic — are contending that milk prices are falling as their costs are exploding. But $20 million in federal funding will advance dairy in the Northeast, and Organic Valley offers contracts to organic milk producers in the multi-state region left high and dry by Horizon.

Seven months after 27 farmers in Vermont - among the 89 across the Northeast - were shocked by a letter from Horizon Organics saying the company would stop buying milk from them in August, a few bright spots are shining through.

Stimulated by Horizon's announcement, the Vermont Agency of Agriculture, Food, and Markets and several Northeast partners led a farmer-focused Northeast Dairy Task Force to identify key issues facing the region's dairy industry.

The task force's comprehensive report released in December 2021 outlines recommendations for bolstering processing capacity, transportation, farm infrastructure, and technical assistance. It helped create opportunity for a new infusion of dollars.

In March, the USDA announced additional funding of $20 million for the Northeast Dairy Business Innovation Center (NE-DBIC), hosted by the Vermont Agency of Agriculture.

The NE-DBIC is one of four USDA-funded Dairy Business Innovation Initiatives. It helps advance dairy in the Northeast through grants, research, and educational opportunities for farmers, processors, and service providers.

NE-DBIC's current projects include technical assistance cohorts, grants for agritourism and marketing, and an upcoming educational trip to Missouri which will let participants learn about innovative grazing and alternative business models.

The new money will build on work already underway at the center and enable NE-DBIC to make catalytic investments for farms and farmers.

The MacArthur Foundation defines such investment as “patient, risk-tolerant, concessionary, and flexible” contributions of cash, equity, and other forms of capital to give momentum to projects that lack access to these funds. It is designed to spur on additional investment in worthy projects that otherwise would not be within reach.

The NE-DBIC would use the money to invest in processing capacity expansion, on-farm improvements, and technical services for producers.

Another ray of hope came when Organic Valley announced the company is prepared to offer contracts to 80 organic dairy farmers, a majority of those who currently ship their milk to Horizon (now owned by international food company Danone) and would otherwise be unable to market their milk next year.

“We are the only national brand still fighting for small family farms because we know that the best quality food is ethically sourced from small family farms,” Organic Valley CEO Bob Kirchoff said in a news release.

“With the help of consumers and customers across the country, we are helping solve the crisis of disappearing small family farms,” he continued. “We are creating the food system we all want - one that regenerates soil, cares for animals, nourishes people, and strengthens communities.”

Vermont Agency of Agriculture, Food and Markets Secretary Anson B. Tebbetts said, “We are grateful for all those who have stepped forward to help the dairy community.”

Locally, the Putney Food Co-op is lending a hand by being the first retailer to officially join the Northeast Organic Family Farm Partnership's efforts to support the region's local organic dairy brands and organic dairy farms.

The Partnership, launched earlier this year through the efforts of Stonyfield Organic co-founder Gary Hirshberg, encourages consumers to buy more organic dairy brands - from farms that include Butterworks Farm, Hawthorne Valley Farm, Miller Farm Milk, Organic Valley, Stonyfield Organic, and Strafford Organic Creamery - thus building demand for the milk producers to remain financially viable.

Brands can become partners by ensuring that half their dairy products come from the areas hardest hit by potential farm closures. Retailers that purchase partner brands can display a logo that helps identify them to customers.

The Putney Food Co-op is the first retailer to join the consortium.

Local organic farmers: a range of reaction

Windham County organic milk producers such as Lilac Ridge Farm in West Brattleboro, the Miller Farm in Vernon, and the Corse Farm in Whitingham were spared the ordeal Horizon shippers are facing, since they were already selling to Organic Valley or Stonyfield Organic.

Lilac Ridge, a third-generation working dairy owned by Amanda and Ross Thurber, sells to Organic Valley. The couple has a thriving organic vegetable farm in addition to an Airbnb, where folks can stay in an 1830s farmhouse.

“Our farm is holding steady,” Ross Thurber recently told The Commons.

“Organic Valley makes an organizational effort to maintain a stable pay price for farmer members in good markets and bad markets,” Thurber said. “It takes a lot of planning and a little bit of risk taking.”

Thurber is getting about $31 per hundredweight (100 pounds) for his milk. The price varies due to butterfat and protein content - so much so that he's planning, with his nephew, on making some breeding changes to the current Holstein herd so the resulting milk will offer more of both.

“He's already interested in breeding and looking at grazing-based breeds,” Thurber said of his college-bound nephew. “We're looking for cows [that are] more medium-sized, smaller-stature, aggressive grazers. And temperament factors in.”

At the Miller Farm, which sells to Stonyfield as well as locally, five generations have been farming about 700 acres in the Connecticut River Valley since 1916. It is one of the oldest registered Holstein herds in North America with 199 head of cows.

Miller Farm became certified organic in 2009. The family bottles about 5 to 10 percent of milk produced here themselves, and the rest goes to Stonyfield for yogurt, said Peter Miller.

The Millers are currently receiving about $34 per hundredweight for milk. Despite the rising cost of production, what farmers are paid isn't keeping pace - and, Miller said, that rate has actually been decreasing.

“We used to be about $5 more three years ago, and they've progressively been cutting their price,” he said.

“And our costs have gone way up in the past year,” Miller said. “Soy has just about doubled. Labor, building materials, equipment, fuel, oil, steel - have all gone up. So we've had hyperinflation in real goods over the past year or two.”

“Stonyfield is saying they're going to give us a price increase or at least investigate it, but we're losing money right now,” he continued. “The cost of production is up very significantly. The costs are rising, and what we're getting paid is not.”

The obvious consequence is that “we'll see a lot of even organic farms closing if the prices don't come up,” Miller said.

But the farming family welcomed the news that Northeast farms producing organic milk will have some new options.

“We're glad they're picking up more organic farms,” Miller said. “Getting someone to pick you up beats having zero dollars for your milk.”

Miller said although he “still believes small farming is better for the economy and environment,” he's “a little discouraged on every front.”

He spoke philosophically for a moment, noting the fact that Horizon representatives have been driving throughout the state to offer organic farming contracts person-to-person, “when they could have just gotten one mega-farm.”

“If you have a farm producing with ingredients like grain from the Midwest and only drive the finished product to the market, it's probably burning less diesel than chasing all over New England to come up with a truckload of milk,” Miller said.

“What if a mega-farm really uses less carbon? And what if one using GMOs burns a whole lot less carbon? So, the water gets pretty crazy muddy.

“If we're worshipping the environment and carbon is king, then that's a different narrative than organic solving all that,” Miller continued.

But, he said, “If we want to keep food security and local jobs and streams and lakes to be better, then it's good to have these small farms we espouse in New England.”

The Corse family has been raising dairy cows for 153 years. They are also Organic Valley shippers. Leon Corse's daughter Abbie works on the Corse Farm Dairy and also sits on the Northeast Organic Family Farm Partnership board and is part of NOFA-VT, the Northeast Organic Farming Association of Vermont.

She thinks Horizon's outreach is “wonderful,” while agreeing the challenges ahead are real.

“This is what being a part of a cooperative is,” she said. “You go all-in for the good of the whole, and part of that is, how do you support the community of which you're a part? And these farmers are that.”

“Because we're a farmer-owned cooperative, we would be out of business without Organic Valley, and the idea that these farmers would be put out of business by a multinational conglomerate is deplorable,” she continued.

Corse concedes that “it won't be easy.”

“We have to make a market for this milk, but that's a risk we have to take on to support the organic dairy community,” she said. “We have to do everything we can do as a state and community to keep them going.”

Kevin Hamilton's 50-head farm in Brattleboro - mostly Holstein (with two brown Swiss) - is a conventional milk producer, not an organic producer. He's been involved since 1974 and now his son, Jacob, is in charge, he said.

“When we could have changed to organic I didn't think it would be a good fit for our farm,” he said.

Still, he's holding is own.

“I probably shouldn't even say this, but the pandemic did us more good than anything else that's happened in the milk business in years,” Hamilton said. “The government payments. They gave away a lot of money.”

“They were feeling bad for us, and they were handing out money - and it helped a lot,” he continued.

“On the other hand, right now the price of conventional milk is what it should be all the time, over $25 a hundredweight of milk,” he noted.

Plus, he said, “If your milk has butterfat over 3.5 percent or about 3 percent protein, they add extra.”

For conventional milk, the pricing structure, determined by the U.S. Department of Agriculture, “gets complicated pretty fast,” Hamilton said.

The national view

A number of people and organizations are working to even the playing field between small farmers in the Northeast and large farmers in other areas of the country. Many have asked the USDA to get rid of a loophole in the National Organic Program.

The loophole, created to allow conventional farmers to make a one-time transition to organic farming, permits animals not raised organically to be transitioned to organic later on in their lives.

But when farmers leverage the rule to continually raise young livestock non-organically - at lesser cost - organic farmers are disadvantaged.

Recently, the USDA made a policy change in its organic standards to try to make things more fair across the board.

“There is a piece of this that is going to help level the expense across all organic operations so that everyone is either procuring or raising animals in the same way,” said Laura Ginsburg, section chief at the Vermont Agency of Agriculture, Food & Markets.

U.S. Sen. Patrick Leahy, D-Vt., who helped pen the National Organic Program, the federal regulatory agency that creates and standardizes federal implementation of organic standards, recently helped allocate $22 million for program administration. In accompanying legislation, he directed the program “to deliver the strongest possible enforcement oversight.”

“I thank USDA for making this change - we must remain vigilant in protecting organic standards,” said Leahy. “This will help ensure that large producers are not abusing a loophole to give themselves an unfair advantage.”

Miller, however, thinks the move is “too little, too late.”

“All the dishonest people have gotten so rich in the economies of scale that the story's almost over,” he said. “It should have been closed up immediately.”

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