—Lancaster Farming, Saturday, November 11,1978 34 Eastern Milk of proposed By SALLY BAIR Staff Writer NEW HOLLAND -- After more than a year of serious financial woes, members of Eastern Milk Producers Cooperative got some good news at the an nual fall meeting of the New Holland local held Wed nesday night. Eastern General Manager Howard McDonald assured the members that there would be no assessment of mem bers to help pay the cost of construction and operation of the proposed cheese plants, which are a major part of their plan to reach financial stability. The mood of the meeting was forthright and op timistic. While acknowledging that serious decisions still must be made, officials of the Cooperative made it clear that they feel the Cooperative has reached a turning point in their financial difficulties. McDonald said, “What Eastern has been able to accomplish in the last year and a half is due to the membership, who poured a lot of money into it.” He called their problems, “A burden you’ve had to bear. The financial picture is still not great, and we have a long way to go, but some of the things we have ac complished are amazing.” He pointed out that in December of 1977 there was an accumulated deficit of $BOO,OOO. By March 31, 1979, that deficit will be com pletely wiped out. The net worth of the Cooperative one year ago, according to McDonald, was “zero.” He said the net worth now is $BOO,OOO and at the end of this fiscal year it will be $1,300,000. “A lot of people put a lot of work into it to make it work,” he said. He noted that the Cooperative is now operating on a “pay as you go policy, on a fiscal year basis.” McDonald explained that the financing of the proposed cheese operations will cost “a lot of money,” probably between $l3 million and $l5 million Investments are being made with the help of an investment placing firm which is working with the Farmers Home Ad ministration so that it, hopefully, will guarantee 90 per cent of the total finan cing We don’t have the final commitment from FmHA to guarantee financing, but everything seems to be in a ‘go’ position,” he remarked Even if this proposal does not come through, McDonald stressed that other options are being investigated to acquire the money. “The money will come totally from outside Eastern Milk Producers - members will not be asked to contribute ” Financing of the plants will be for twenty years, and Eastern will own the facilities and the equipment Lease payments will be made by Cheese Company of Denver to Eastern, ears Eastern will have $6 8 million in At annual banquet equity m the cheese plant. He added, “A lot of things could go wrong, but we don’t see anything to change the picture drastically.” It was point out that Leprino is the largest smgle manufacturer of mozzarella cheese in the world, and they are the sole supplier for the Pizza Hut restaurant chain. The manufacturing and merchandising of the finished product will be completely m the hands of Leprino, with Eastern supplying the milk and the equipment for processing it. McDonald noted that the contract with Leprmo takes into account the seasonality of milk, and allows for larger amounts to be used in the manufacturing when there is a surplus in the Spring. While cheese operations are faced with the problem of idle times, McDonald said that Leprino is the only cheese operator in the country which has perfected the freezing of cheese to retain its quality, and therefore can even out its production. He was not surprised when questions were asked about possible links between Leprmo and organized crime. McDonald said that while it has been shown that organized crime is involved in the Italian cheese business, an article which listed companies and in dividuals involved did not mention Leprmo. He said further that banks involved in the financing venture did “an exhaustive study” and found that Leprino “came up clean.” The first cheese plant has just undergone trial operations and is scheduled to go into production this week. Eastern acquired the former powder milk plant from Dairylea in February, 1978, and at the end of June began preparations for the overhaul which made it into a mozzarella cheese manufacturing plant The location of a second proposed plant is still in question, with several sites under consideration, ac cording to McDonald. The second plant is being planned for larger volume than the first McDonald noted that one of the prime reasons for moving into the manufac turing business is to be able to handle manufacturing excess milk, without being “at the mercy” of other people Last Sprmg in the surplus season, Eastern suffered enormous losses “when we had other people do the manufacturing.” On a further positive note, McDonald said that Order 2 prices are now the highest in history and will remain high. He said that in the next six months, prices will average $l.OO higher than for the same months last year, and in some months it will be $1.25 higher For the coming 12 months, McDonald said prices will probably average $ll 00/hundredweight Along with better prices and an unproved financial picture, McDonald concluded, “It should be a good year to be an Eastern member ” Co-op tells cheese plant Franklin Wagner, left, district director and Howard McDonald, general manager at Eastern, were both part of the program at the New Holland local meeting Wednesday night. District Eight Director Franklin Wagner, Hum melstown R 2, spoke on a hopeful note too, telling the members that “Eastern is an on-going business.” While Eastern was considered m banking circles to be “un bankable” one year ago, with the changes currently taking place the position is turning around. Wagner said, “Credit goes to the manager and his staff and to the Board of Directors, but the large amount of credit belongs with you - your loyalty to Eastern has brought us to this point. We will face real problems, but we are establishing a good relationship with other co ops and businesses.” He emphasized that the cheese venture will be good not only for Eastern members, but for the dairy industry as a whole. Wagner urged members to handle rumors carefully, and check out the truth with Cooperative authorities. Ivan Redcay, fieldman and inspector, also urged members to call with rumors and leam the truth. He said, 4-H Council meets YORK - The November meeting of the York Co. 4-H Council was held at the 4 H center, near Bair. Reports were given Members who wore costumes were judged and “The going has been tough, but now it is going the other way.” He reminded mem bers to handle antibiotics with care. Paul Bruckhart, Manheim R 5, delegate for the local, echoed the positive sen timents of the other speakers. “Things are gomg to work out great. We will be able to take care of all the milk being, produced, put it to good use and make a profit.” He reminded members, “It behooves all of us to have clean, quality milk, properly cooled so it will be of good quahty to those who consume it.” Bruckhart said that while Eastern lost 430 members (over 200 through herd sales), 340 new members have been signed up over the year. “Let us look forward together that we may stay strong. Things have really improved financially, and I am proud to be a member of Eastern.” Local president Robert Martin conducted the meetmg which was attended by 125 members prizes were given. Af terwards a Halloween Dance was held. The next meeting will be December 6, at the 4-H center The program will be a Christmas party ADAMS CO. O.C. RICE, INC Biglerville, PA 717-677-8135 YINGLING’S IMPLEMENT RDI Gettysburg, PA 717-359-4848 BERKS CO. N H. FLICKERS SONS, INC. Maxatawny 215-683-7252 STANLEY A KLOPP, INC, Bernville, PA 215-488-1500 MILLER EQUIPMENT Bechtelsville, PA 215-845 2911 SHARTELSVILLE FARM SERVICE RD 1, Hamburg, PA 215-488 1025 H. Daniel Wenger, Prop. ZIMMERMAN'S FARM SERVICE Bethel, PA 717-933-4114 BRADFOR ALLIS HOLLOW EQUIP, RDI, Rome, PA 717-247-2601 CARLL PIERCE RD2, Columbia Cross Roads, PA 717-297-3513 WYNNE’S GARAGE Canton, PA 717-673-8456 BUCKS CO. CJ WONSIDLER BROS Trumbauersville Road Quakertown, PA 18951 215-536-1935 PAULHISTANDCO., INC 397 North Mam Street Doylestown, PA 215-348-9041 CHESTER CO. CHAS. J. McCOMSEY &SONS Hickory Hill, PA 215-932-2615 STOLTZFUS FARM SERVICE Cochranvitle, PA 215-593-5280 M.S. YEARSLEY & SONS West Chester, PA 215-696 2990 CLINTON CO DUNKLE&GRIEB Mill Hall, PA 717-726-3115 COLUMBIA CO. ORANGEVILLE FARM EQUIPMENT Orangeville, PA 717-683-5311 WILLIAM F. 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SEIPLE & SON Easton, PA 215 258-7146 lORTHI MECKLEY’S LIMESTONE PRODUCTS, INC Herndon, PA 717-758-3915 SCHUYLKILL CO L.L ECKROTH FARM EQUIP , INC. New Ringgold, PA 717 943-2367 STANLEY'S FARM SERVICE RD, Klmgerstown, PA 717-648-2088 SNYDER CO. ROYER’S FARM SERVICE ROI. Winfield, Pfi New Berlin-Middleburg Hwy 717-837-3201 TIOGA CO. CANYON IMPLEMENT, INC Mansfield, PA 717-724 2731 WAYNE CO. MARSHALL MACHINERY Honesdale, PA 717-729-7117 WYOMING CO ACE-JURISTA, INC Tunkhannock, PA 717-836 2610 YORK CO AIRVILLE FARM SERVICE Airville, PA 717-862-3358 GEORGE N. GROSS, INC RD 2. Dover, PA 717-292-1673 M&R EQUIPMENT, INC. New Park, PA 717 993 2511 CARROLL CO.. MD WERTZ GARAGE, INC 4132 E. Mam St Lmboro, MD 301 374 2672 CECIL CO. MD AG INDUSTRIAL EQUIPMENT CO Rising Sun, MD 301-658 5568 FREDERICK CO.. MD KNOTT N. GEISBERT, INC RD2, Frederick, MD 301-662 3800 HARFORD CO . MD WALTER G COALE, INC Churchville, MO 21028 301 734 7722 ENFIELD EQUIPMENT. INC Whiteford, MD 21160 301-452 5252 301-838 0480 IMBERLAND