Organic milk boom in Maine going bust

Organic milk boom in Maine going bust


Hood drops northern, Down East dairy farms
BANGOR DAILY NEWS PHOTO BY SHARON KILEY MACK
A group of organic milk farmers gathered in Clinton on Saturday to talk about the H.P. Hood ending contracts with eight farms in Aroostook and Washington counties and a request by the processor that other organic dairy farmers cut their production by up to 15 percent. Richard Lary (left) talks to a farmer on the phone while Mark McKusick of Dexter and Martin Lane of New Vineyard look on. "The consumer needs to know how serious this is,'' Lane said. Buy Photo

Too much supply and too little demand in a recession have caught up with the fast-growing organic milk industry, dealing a harsh blow to Maine producers.

Dairy industry giant HP Hood recently told eight Maine organic dairy farms their milk contracts will not be renewed. In its next move, Hood notified most of the remaining 14 organic milk producers in the state under contract to the company that they must cut their production this year by 15 percent.

There are 72 farms in Maine producing organic milk. Some sell in bulk to other processors such as Organic Valley and Ho-rizon Cooperative.

The farms being dropped by Hood are in Aroostook and Washington counties only, an area courted heavily by Hood just three years ago, when the organic boom was at its peak.

Hood ships Maine’s organic milk to New York to be processed and packaged and then returns it to Maine where it is sold as Stonyfield Farm Organic Milk.

In the retail market, organic milk can easily cost twice as much as conventional milk and, for the farmer, this translated into premiums and bonuses that lured many conventional dairy farmers to switch to organic, which they believed would be more profitable for them.

But in recent months, as the economy collapsed, so did consumers’ shopping habits.

“They told us they have too much milk,” organic dairyman Vaughn Chase of Chase Farms in Mapleton said. “It is the worst possible news at the worst possible time.”

Organic milk is produced according to certain strict production standards on both the state and federal level. A farm must be certified, and crops fed to cows must be grown without the use of conventional pesticides and artificial fertilizers, free from contamination by human or industrial waste, and processed without irradiation or food additives. Livestock must be reared without the routine use of antibiotics and without the use of growth hormones, and generally fed a healthful diet.

Organic dairies have grown by leaps and bounds throughout New England over the past 15 years. By 2006, organic dairy farming had become the fastest growing agricultural sector in New England and Maine had the highest percentage of organic dairy farms compared with conventional farms in the country — 16 percent.

But with the declining economy, the demand for organic milk has just not caught up with production, according to Hood’s spokesperson Lynn Bohan.

“Due to a softening in organic milk sales triggered by the recent economic downturn, Hood has made this difficult deci-sion,” Bohan said. “Increased transportation costs also factored into Hood’s decision, as the raw organic milk procured in outlying areas must be shipped to the company’s processing plants. Hood pays all costs associated with transportation — both farm pickup costs and cost for finished product to reach consumers.”

Bohan said the farmers who are being dropped have contracts that end at various times from August 2009 to June 2010, and she said they have been given a minimum of six months’ notice.

Founded in 1846 and based in Massachusetts, HP Hood LLC is one of the country's largest branded dairy operators with 23 manufacturing plants throughout the country. It sells organic milk under the Stonyfield Farm brand and has annual sales of $2.3 billion, according to company information.

“We’ve been left high and dry without a market,'” Chase said. “We’ve all made investments based on organic milk prices and some of us need to know before spring if there is another processor willing to take our milk. We need to know if we should sell our herds. We need to know if we should continue to make hay.

“This is a helluva time to be dropped,'” he said.

Chase has a herd of 100 organic dairy cows and ships 2,800 pounds of milk a day, 7,500 pounds a day in the summer.

Just like their conventional counterparts, organic dairy farmers are struggling. Their expenses — fuel, energy, health care and feed — have skyrocketed, while the price they receive from processors has been relatively stagnant.

Matt Oliver at Oliver Farm in Hodgdon bought into the organic program just last June. He put up a new barn and is raising 20 heifers in anticipation of expansion. He said he just doesn’t know what he will do when his contract runs out in June 2010.

But David James at James Pond Dairy in Charlotte knew exactly what he will do.

“We’re done farming if we don’t find a market,” James said.

After 17 years of conventional dairying, James switched to organic three years ago. “Hood kept at us and kept at us to get going as organic as fast as possible. They promised a rosy future, then, three years later, they shut us off.”

James said the prospect of selling a $2,000 organic milk cow for beef, at $700 to $800 a head, makes him sick. “We just don’t know what is going to happen,” he said.

Although the Aroostook County producers could possibly switch to conventional milk, the two dairy farms in Washington County cannot. No conventional milk truck serves the area.

Aaron Bell of Tide Mill Farm in Edmunds is one of those farmers without a conventional option.

“We are hoping to avoid financial ruin,” he said. “We are hopeful another processor will take us, even if on a temporary basis to give us a lifeline, some oxygen, until we could build up some direct marketing.”

Chase said he believes Hood is making a grave mistake. “Dairy experts are predicting by the fourth quarter of this year, everyone will be short of milk. When organic processors are short, they can’t just go out and grab milk from any old farm. It takes from one to three years to transition [from conventional to organic.]”

Meanwhile, the organic farmers in Aroostook and Washington counties are working together to entice another organic processor, such as Organic Valley or Horizon, to work with them.

“Me, personally, I'll stay organic as long as I can, even if I have to sell conventionally,” Chase said.

bdnpittsfield@myfairpoint.net

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Comments
38 comments on this item

why doesnt the state and farmers band together and start their own maine made bottling and processing company after all we have all this wonderful stimulus money and our own processing plant will provide jobs

bandit, for the same reason we don't have our own lobster processing plant, it makes too much sense. If the state doesn't start supporting Maine industries, there will be less revenue to spend than there is now. We all need to stick together if we are going to survive.

We have great natural resources, including hard working citizens. If the state would help us instead of increasing fees, licenses, etc..., think of what we could accomplish.

If you haven't tried organic milk before I strongly suggest you do. It's great. It tastes much better, much more creamy, and it's ultra-pasteurized so it stays good in the fridge a lot longer.

I buy organic milk because its better. Its shelf life is incredible, not to mention I support local farmers such as Chase Farms.

I think an organic dairy in Maine is a great idea!

i think some of the state and/or federal farm subsidies should be used for local organic farms, not just giant agri-businesses. it seems to me it's benefits would be great. Less fuel costs shipping products, keeping small farms and farmlands in production, less pesticide use (possibly leading to less pollution and better health) and just better food in general. If you look globally to places where there is greater longevity and less disease, the common link is that they eat locally, naturally produced foods. This is where, in my opinion, economic stimulus should be. Not in bailing out Wall Street and big businesses that have failed, because of their own mismanagement. The one thing that is consistent is the need for food. A good diet is essential to good health, not prescription drugs and over priced "health"care. It should be called "disease" care.

To heck with "the state". You have a good idea? - pick up the phone and call another farmer and start a wholesale retail business. If you are waiting for the state to come to the rescue ask the folks in New Orleans how that worked out for them!

I like to buy organic milk, but not at $5/gallon when regular is going for $3.50. That's too much of a markup.

The worst thing for these industries is for "The State" to get involved. Yes lets turn them into beaurocracies like social security, the DOT, or better yet DHHS. Shining examples of government progress and efficiency. When will you mindless dolts realize the government is the problem. After all of the government intervention into the market place over the last 100 years and to see the end result of it as our current state of affairs, you still scream for more of it. Absolutely INCREDIBLE!

Organic is worth it in every way- for the farmers to keep them on the land, for "consumers" because it protects our health and provides delicious, high quality nutrients, and for all of our futures, because organic agriculture protects the water we drink, the soil our kids play in, and the air we all breathe.

Hello???? We're in a recession idiots!! Maine is a poor state! Yet, do you think people are going to spend there hard earned money organic milk?? Of course not, there gonna do what every poor Mainer does. Spend it at hollywood slots!

Thats the way the cookie crumbles,and milk.....lol

It is stupid to by organic milk in the first place. It is still from a cow they just concince people that the cows are feed something special. Ya right.

slow production in off season non-tourist months,only tourist $ will buy something thats more expensive but not that much different,like anything else its supply and demand,jeesh,cant you guys manage a small dairy?

look you dont want to buy organic dont as far as the state doing any thing for working people that was tongue in cheek. farmers who want to sell milk should band together and start own processing plant. i sell all natural raw milk when ihave it look around and you can find what you want with out it going out state first fresh milk ha ha

Next winter Hood will be trying to recruit them back to the organic program when sales pick up.

I buy organic milk out of state. As a retired Maine farmer I know how important customers are. I buy Organic Valley because on some packages they say "from New England Farms." And I want to support New England Farms, but even more I want to support Maine Farms. I buy the Stonyfield brand second because I used to know some people associated with the brand, even though it's gone big business now. And Horizon if I can't get the other two. Now that I know Stonyfield is using Maine milk it moves up on the list. However, a little brand identity would help. Knowing where the products are coming from is important to me, and few packages even have the location where they were packed anymore. I buy Poland Spring when I'm buying water because I know where it's from, even have some idea where the profits are going, but that doesn't stop me. As a Maine taxpayer I want the money I'm spending to be taxed in Maine, helps spread the load we all bear. It's all tied together folks. You buy generic, you get generic. And your local farmers go broke.

I remember having milk straight from the cow! It was great! Creamy, rich and flavorful! It didn't taste like it was watered down or like powdered milk. I'm sorry for the farmers who are now having to deal with being sold out. I do agree that a processing plant right here in Maine, (possibly in Washington or Aroostook Counties) would be an excellent idea. Band together, create a Cooperative and get it going! Don't wait for Augusta or D.C. to bail you out. Take the initiative and show them all that Mainers aren't quitters. We don't give up, we don't just lie down and go away, we become something more! Maine Dairy Farmer's Cooperative would be just that. Bigger and Better than any single farm with single contracts. Also you would then have more weight in any future negotiations with buyers such as Hood. AND if you process it here in Maine, you could possibly bring the pricing down a bit and sell more. I can't afford to pay $5 a gallon for milk, I wish I could. But if it were closer in price (last I knew it was almost $3.89 per gallon for whole milk) the product would sell much better. Many people would rather buy organic, if they could afford it.

Richard37 -

A major factor in the production cycle, IE up and down, of organic farms has to do with the availability of green grass - organic rules dictate that cows are on pasture when the grass is growing, in addition they produce more milk when they eat more forage, so in the summer their milk production is higher, it has nothing to do with the tourist season, many farms have gone to seasonal production where they shut down in the winter and begin milking in the spring, thus taking advantage of the "green season" - there is a lot more to running a farm than you may think. Now as for building a processing plant - that would be the best option, heck I'll even do it - the question is where does the capital come from? The fed just gave another $30B to AIG - but try and get $1.00 to build a dairy here in Maine. Want to take up a collection?

suemcgoo -- you are right on 100%.

pcme2000what planet are you from? People aren't "convinced" that cows are fed something different, they absolutely are fed and handled differently. You obviously no NOTHING about organic milk. Please refrain from commenting on issues you know nothing about. Educate yourself first.

Avani112 -- alas, you are probably right about most folks. Very sad indeed . . .

fakename -- I agree, we need brand identity. I usually buy organic milk directly from the farm, but would like to know where it comes from if I have to make a store purchase.

Independent,

Milk is creamy because of the breed, not because its organic, come on are you that dumb?, and ultra pasterized just means they boil the hell out of the milk, that not really a good thing, b/c you loose all nutrional benefits, all milk is ultra pasturized, whether its organic or conventional. A holstein cow will produce less cream whether its pasturized or raw vs a jersey. but once it hit the boiling pot the cream is all gone anyway. Good raw milk from a jersey is good whole milk with a nice creamy top to the jar.

It all come down to Washington county, unless God waves his wand and we become industry bases, with a good economy, no one in there right mind will come way the hell down here--we are just too far out, so lets just face it.

pcme2000, do you really think there is no difference between organic and conventional or family vs. factory farms? Look at these pictures and tell me which way is better for the cow, for people and for the environment.

http://www.cornucopia.org/wp-content/gallery/horizon-factory-farm-photos/heifer_facility_small.jpg

http://www.cornucopia.org/wp-content/gallery/aurora-texas-factory-farm/where_is_the_grass1_small.jpg

http://www.cornucopia.org/wp-content/gallery/ecologically-managed-organic-farm-photos/rodney_martin2.jpg

http://www.cornucopia.org/wp-content/gallery/ecologically-managed-organic-farm-photos/the_thickie_cows.jpg

Believe me, Hood's corporate greed (dropping Maine family farms in favor of large pseudo-organic factory farms in TX) will come at a cost to the consumer and to every inhabitant of this earth.

People on foodstamps would be a good place to market Organic milk - they are spending OPM (other people's money) so they are much more likely to purchase it.

people on food stamps are to busy buying lobster and t-bones to care about milk,Maine Taxpayer.

As much as you might think that one would like to spend OPM (other people's money) on items like Organic Milk for themselves and/or their family, it's unlikely given that they only get $175/month to spend on food itms/personal care items. It sounds like you think that they have it made spending OPM, however, you should try allocating only $175 a month for yourself.

I dont spend OPM on anything. I spend my own Hard Earned MONEY, and yes, I pay the premium for ORganic Milk, Lobster and T-Bones when I want. I like the comment about hollywood slots. I was just surprised that it didnt refer to Beer and Cigs.

Ya, that's just what we need: a Dirigo Health approach to organic milk farming. If the state gets involved, they will mess it up @ the taxpayers expense as usual. The State should not mettle w/free enterprise.

"When Milk Goes Green"

if i was a farmer id get in good with allens brandy company and get me a contract,5 dollars for a gal of milk people complain ,but over 20 for a half gal of allens and they keep sales rising ,go figure huh,

the moneymen have us by our survival, or do they? (they are sooooooooooo rich!)

if all stores close, will we die?

me personally, it would be refreshing to have the whole tap dance end

so we might face each other and figure out how to LIVE and CREATE in a sustainable, just, non-toxic life not governed by profitability.

i'd like to think we are creative enough as human beings to keep doing what we are passionate about and skilled in enough to make sure we survive "the depression" - not to be confused with "the oppression" i wanna go loco on the system, but we gotta get LOCAL..

"they" love it when we consume- seems our voting power is with our purses, pockets and wallets.

i fantacize of a self-sustaining culture that actually gives a rat's booty about the individual. people are hurting and we can try to pass the buck around

but reality is going to smack us down every time. we are empathetic, magnificent creatures designed to nurture and care for one another, the animals and our beautiful planet. these are the devastating affects of a system designed for profit, not people. we all

know we're so much better than this, but how do we get to OUR power? no one from the top cares, they keep the prices high so we can't afford to miss a day of work to figure out how to get off this sinking ship. all the hope we have is in each other and our ability to question everything in the name of truth, justice, humanity, our constitution, global coscience, hearts and health. did i mention, sanity?

my physical body is the one thing "they" can't have, so i eat organic. plus, it's so yummy. i'm not willing to donate a heart attack or some lab rat ailment to Big Pharma/mcD's profit fund (they all sit on the same boards) they rule.net it's the love of power vs. the power of love. don't let the dollar keep you back, let's LIVE our dreams somehow for our children's sake. bush said it the best, "money trumps peace" now it's trumping everything we hold dear, our homes, our food, every aspect of our survival - except our ability to get in it together. quick- before "they" declare a national emergency or martial law.

Interesting that they interviewed an out-of-state milk processor (Hood) but not any in-state processors like Garelick Farms and Oakhurst.

It'll be a sad day when all the milk we purchase at the local supermarket will be imported from China, tainted with industrial chemicals and poisoning our children. All because we wanted to save alittle money on milk. We'll think, Man, we shouldve supported our local farmers when we had the chance.

We should have more Maine Milk production facilities. And it's a damn shame that our stores would even think to sell out of state milk. You don't see live lobsters for sale that come in from out of state, it should be the same of our milk. We need to take ownership of what we buy, and get out of the Walmart mentality of small saving without the consideration of what it's doing to the health of our state and our world.

I've never heard an ad on tv for organic milk, Maine or otherwise. If they can say "California cows are happy cows" then they ought to be able to say "Maine cows are healthy, happy and organic cows"!

Food for thought. As we are going through the so called hard economic times, perhaps somewhat overblown by our media, we see a lot more families both suburban and rural growing and producing their own food from produce to animals ( I can't believe about all the articles about chickens lately). Some products might seem less valuable to consumers (milk and eggs), and if they don't have the space for cows and chickens and with the high prices, these products will stay on the shelf. In turn, if you don't directly market your products (diary) to the consumer and if you sell to wholesale dealers with production facilities out of state, the organic dairy industry will not sustain itself at times when prices are high and consumption is low. I know as a casual consumer of dairy products, which includes milk, I would like to no exactly where the product orginated from and have the opportunity to visit these farms directly to see their operations. Maybe this type of information is missing from the products and thus some, not all consumers, do not see the value in buying organic milk versus convential when the price diffrences we see at the supermarket can be a lot. Maybe there needs to be something else in its value to by organic milk and consumers don't see the difference between organic and convential enough. And as a casual consumer, which many could be, I will by the cheaper.

Organic milk----

Is that when a cow eats organic grass ?

Is algore involved ?

I buy my milk at Tide Mill Farm. Arron, Carley, and his crew work damn hard in all kinds of weather to produce fresh whole milk from here.

I wish it still came in Glass quart milk bottles, but I'll take what I can get. When you buy house brand from Irving, Hanaford, or Shaws, god knows what you're buying. Did you know some markets are importing milk from abroad? Kinda like the cat food a couple of years ago.

I hope Arron and Carley make it, I'd hate to go back to store bought

There is no reason for these organic farmers to go out of business or to continue to send the milk out of state. In fact, consider how silly it is that fresh milk is put in a truck, driven out of state, driven back, and then sold as---fresh milk? Bottle it up, sell it at many of the wonderful farmer's markets throughout the state, sell it to farms that operate CSAs, or sell it to stores. Teach people how to make artisanal cheese, there are so many possibilities. And where is that stimulus money going? Oh yeah, to bankers who might otherwise not get their bonuses. Farms feed America, we need to invest in keeping local food local and accessible. So tell me how do I help the farmers, do I boycott Stoneyfield/Hood, or do I keep supporting it for the next 6 months?

Hello,

We ran across your website and really liked it. Thank you for the good information. We'll come back often.

Thanks again,

BsaB Candles

FYI:

Maine's family-run organic dairy farmers are working together with The Maine Organic Farmers and Gardeners Association and the Maine Farm Bureau to find more local Maine markets. Help support our cause and let your interests in buying Maine-produced, Maine-processed, and Maine-labeled organic milk be known by completing a short survey at: http://www.maineorganicmilk.com/

Find us on Facebook: http://www.facebook.com/pages/Maine-Organic-Milk/59995146009?ref=nf

Thanks for your interest and support :)

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