The cooperative spirit prevails at Dairylea
By DIETER KRIEG
UTSTZ Dairy farmer
members -of -Dairylea
Cooperative are basically
enthused about what’s
happenening with their
organization, despite
thousands of dollars worth of
assessments that have been
heaped on them during the
past several years.
Dairylea, which is
headquartered in Peail
River, N.Y. and has a
membership' of 5500, with
about a quarter of them in
Pennsylvania, assessed its
members four years ago and
lost some friends in doing so.
Earlier this year more
deductions from milk checks
followed and some grum
bling was heard.
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The grumbling hasn’t
ended and there is no
denying that the cooperative
has lost a number of its
supporters during the past
four years. Nevertheless,
' considerable enthusiasm
abounds within the mem
bership despite the debts,
losses, and negative
developments.
Union County dairy far-
mer Eugene Spangler calls
the capitalization program
(see page 1 story) “probably
a step in thetight direction.”
He decided to stay with the
cooperative even after
having considered other
alternatives and having been
hit with a $12,000 assessment
on the production of his 70
cows.
“The capitalization steps
will help to alleviate other
situations - they’ll eliminate
some loopholes - they’re
going about it in a sound,
business-like manner now,”
Spangler continued. “We’re
doing things now that should
have been done eight or ten
years ago,” he added.
Stating that he has mixed
feelings about the overall
situation he has experienced
at Dairylea, Spangler ad
mitted he looked at other
marketing channels before
he decided to stay with the
cooperative. He looked only
at other co-ops, however,
explaining that he “didn’t
like the record of private
dealers.”
Ray Diebold, an outspoken
Blair County dairyman who
has been a Dairylea member
for six years says he con
sidered the old financing
plan anything but wise. He
was one of 13 men (one from
each of Dairylea’s districts)
who looked into the
cooperative’s financial
structure two years ago. He
said he personally was
surprised at the way
business was conducted and
is happy to see the in
troduction of more business
like principles.
Now, after recom
mendations from
professioanl management
consultation firms, the old
form of capital is being
turned into non-interest
bearing notes. “Previously
there wasn’t any investment
in the co-op,” the 38-year old
dairyman revealed.
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Dairylea Cooperative's new
management team is headed by executive
vice president and general manager
Robert Maerz, left, and Clyde Rutherford,
president.
“We got rid of the interest
bearing due-dated notes. The
finances of the cooperative
were outside of the mem
bership before because up to
60 per cent of the certificates
of indebtedness were sold by
farmers to machinery
dealers, feed millers, etc. I
was amazed at the per
centage of ownership by non
dairymen,” Diebold con
tinued.
“I’m pro-capitalization,
although - believe me - it’s
been hurting me from month
to month,” the Blair
Countian went on.
Like many others, Diebold
checked around for other
marketing possibilities.
Order 4 is strongly
represented in Balir County,
but he found out that to have
switched to that market
would have meant building a
base at a greater cost than
the assessment he owed to
Dairylea.
“I firmly believe Dairylea
will do alright once we get
these certificates of in
debtedness out of our hair,”
Diebold emphasized. “They
have been a cross to
Dairylea.
Expressing amazement at
the kind of response
Dairylea is having with the
plan of offering holders of
Lancaster Farming, Saturday, December 2,1978
■it
i'y
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the old certificates 53 cents
on the dollar, Diebold
believes, however, that
much more has been paid.
He hasn’t forgotten the
previous assessments which
kept Dairylea alive during
years gone by.
Diebold is also aware of
the costs of the program, as
is every other Dairylea
member. According to a
letter from Dairylea
President Clyde Rutherford,
the capitalization program
expenses through Sept. 30
were pegged at $547,000.
Deductions from members’
milk checks are taking care
of that tab.
Diebold takes comfort in
the thought that he is in
vesting in marketing
security. “It’s awful nice to
know that somebody is going
to pick that tankful of milk
up,” he commented. “I
mean some of those private
dairies they don’t offer that
security - they can cut you
right off. Diebold is looking
at his marketing in
vestments as representing a
lower income for him now,
but possibly a longer, steady
income in the long run. “I’m
looking at the steady money,
not the quick buck,” the
dairyman concluded.
Lee Shaffer of Selinsgrove
was hit with a $15,900
assessment and' he’s still
with Dairylea. He has been a
member for 22 years and bis
father was before him.
“This capitalization
makes us maybe the
Cadillac of the dairy
business, but I hope all
farmers have good
markets,” he stated.
Echoing comments of
many Dairylea members,
Shaffer exclaimed: “This
new manager, Robert
Maerz, is terrific. If it
weren’t for him, I’m sure we
wouldn’t have the dairy
anymore.
According to Shaffer, not
too many dairymen in his
area considered leaving the
cooperative. “Not too many
fought the plan; I know I
didn’t,” he concluded.
“Without cooperatives it
would be every farmer for
himself,” says Dairylea
director Robert Pardoe. He
operates a 254-acre farm
near Milton in partnership
with his son, Robert, Jr.
They have a total of 145
Holsteins.
“I’m investing in the
cooperative simply because
I believe this is the direction
we’ve got to go,” Pardoe
noted. “Bear in mind that
private handlers dropped
dairymen last Spring and
now they want’em back.
There is more security in
marketing through a
cooperative.”
(Turn to Page 38)
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