Update

Just to update my readers on what is going on and why I haven’t posted for a few days.

I have been working on gathering information for my testimony on Kansas Senate Bill 300 & SB 308. I will be testifying in Topeka, Kansas on Wednesday February 12th and Thursday February 13th. There are a large number of people signed up to speak about SB 300, the ban of on-farm sales of raw milk and raw milk products, so I might not get time to testify but my written testimony will be printed for the Senators to read. I will plan on speaking on Thursday about SB 308 which will require the labeling of containers with raw milk.

SB 308 seeks to force the labeling of raw milk and raw milk products with the following warning: “This product contains ungraded raw milk that is not pasteurized and, as a result, may contain organisms that cause food-borne illness, especially in infants, young children, older adults, pregnant women an people with weak immune systems.” This warning must not be smaller than the largest fonts used elsewhere on the label. To tell you the truth, I find that much wording on a label, will take away from anything else being on the label, such as the name of the dairy (which in most advertising is the largest part of an advertisement.). So how would you like a product you make be over shadowed by a warning? Not good for advertising, in my opinion.

There is some issues with the label warning and it is the word ‘ungraded’. The Grade “A” Pasteurized Milk Ordinance (PMO) states that as long as a farm is producing milk according to the level of Grade A requirements, then that milk is Grade A. So in other words, the guidelines in the PMO states what the farm has to do, to maintain a Grade A level and as long as those standards are met, the milk is Grade A. The U.S. Department of Health and Human Services Food & Drug Administration sets these inspection standards for all dairies, so as long as the standards are met, the milk will be considered Grade A. The wording in the warning states “ungraded raw milk”. So there need to be some discussion about the wording.

The real issue is Dairy Farmers of America (DFA) the milk cooperative that most dairy producers in Kansas sell their milk to, unless they process all their own milk. DFA has in the past, had a history of bullying the small producer into selling to them or not being able to sell at all, or, they go into another cooperatives area, convince their members to sell to DFA for a higher price, then once the cooperative is bankrupt, they buy it or let it die, then all the farmers are forced to sell to DFA. Once they get all the farms selling milk to them, they drop the prices and either the small producer sells out because they can’t get a good price to cover their expenses or they start selling raw milk off the farm. Then DFA goes to the State and pushes legislation to stop raw milk sales. DFA has a monopoly in Kansas, they want all the produced milk or the ones who aren’t selling to them to stop selling raw milk to the public. Monopolistic behavior I believe.

So the long and short of all this is, SB 300 & SB 308 are ANTI-small farm. Only the larger farms and corporations will survive because they work on the economic premise of economy of scale, meaning the larger they are, the better their bottom line will be working with DFA. The small farms cannot compete as their bottom line and margins are so much smaller and can’t break even.

Here is an example: Small dairy farmer A is getting $21/100 pounds of milk from DFA. Farmer A needs $19/100 pounds to break even. A farmer can’t keep producing at these kind of margins forever and if feed prices go up, their margin is smaller. But a large corporation can buy in larger bulk and feed prices when you buy in larger bulk quantities, you can get better deals (lower prices). Economy of scale makes your break evens better.

Let’s say Farmer A decides to make a few extra bucks selling raw milk on the side and also some raw milk products like yogurt, cheese and butter. It still costs $19 to produce but their income from the raw milk sales could be much higher. If they make yogurt and for 5 gallons of milk they use to make the product, they get $40. So let’s do some algebra.

5 gallons weighs about 41.75 pounds. 100 pounds divided by 8.35(about what a gallon weighs) = 11.97 $40 sales from 5 gallons of milk ($40/5 = X/11.97(gallons in 100 pounds of milk) Cross multiply $40 X 11.97 = 478.80 and divide by 5 = $95/100 pounds of milk.

DFA pays the farmer $21/100 pounds and if the farmer uses that milk to produce a raw milk yogurt for on farm sales, they can get $95/100. Do you see why DFA doesn’t want the farmer to sell raw milk? Yeah, me too. They make a hell of a lot more selling raw milk products than selling to DFA. But really, Farmer A won’t have near as many customers to compete with DFA’s processed milk retailers. Yet DFA doesn’t want the small farmer doing this. Why? They want the monopoly, thus the Senate Bill 300 to ban on farm sales of raw milk. Does it piss you off like it pisses me off? No corporation should dictate legislation to kill competition. No legislation should be anti-small farm either. Now you know why I am going to Topeka this week.