❗Let's close the gap: We still need your help to raise $40,000 by April 1. Donate now

Dairy farmers face shrinking paychecks

Marketplace Staff Sep 18, 2009
HTML EMBED:
COPY

Dairy farmers face shrinking paychecks

Marketplace Staff Sep 18, 2009
HTML EMBED:
COPY

TEXT OF STORY

Bill Radke: An over supply of milk and a drop in international demand have sent prices paid to farmers to their lowest levels in 30 years. Farmers blame some of their problems on a lack of competition in the wholesale industry, and they’ve asked the U.S. Justice Department to investigate anti-trust allegations. Tomorrow, the Senate Judiciary Committee looks at the complaints with a hearing in Vermont. From Vermont Public Radio, John Dillon reports:


John Dillon: Over the last year, dairy farmers’ paychecks have shrunk nearly in half. They’re paid about $11 for 100 pounds of milk.

But Dave Montagne said it costs him about $18 in feed, fuel and labor to produce that much. The Vermont farmer figures he’s losing at least 100 bucks a month on each of his thousand cows.

Dave Montage: Our size farm, it’ll be minus a million bucks for the year.

Many farmers and their allies in Washington blame the low prices on a lack of competition among milk buyers. There are just a handful of dominant milk companies in the country buying milk from tens of thousands of farms.

Vermont Senator Bernie Sanders has asked the Justice Department to investigate Dean Foods, the nation’s largest milk company. Sanders says the Dallas-based company controls 70 percent of the milk market in New England.

Bernie Sanders: So while farmers’ prices are at a 30-year low, Dean Foods is seeing a huge increase in their profits. And we think those two issues are not unrelated.

Dean Foods says the federal government, through price supports, has a big role in what farmers are paid. And the company says the simple law of supply and demand is what’s behind the plummeting milk prices right now.

For Marketplace, I’m John Dillon in Montpelier, Vermont.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.