Lanco Co-op Leader Discusses Milk Marketing Challenges
DAVE LEFEVER
Lancaster Farming Staff
LEOLA (Lancaster Co.)
Lanco Dairy Farm Cooperative
will continue its efforts to secure
the best milk prices for its mem
bers in spite of adverse market
conditions and tough competition
from larger milk handlers,
according to leaders of the farm
er-run co-op.
Lanco was first started in 1998
as a division of Allied Federated
Cooperatives, Inc. based in Can
ton, N.Y. Lanco now has about
800 producer members, the ma
jority of them in the eastern and
southern parts of Pennsylvania.
Dave Elliott, director of mem
ber services at Allied, led inform
ational meetings this week for
Lanco members in several loca
tions, including Lancaster Coun
ty where a large portion of Lanco
members are Amish producers
with relatively small herds.
Elliott spoke about the condi
tions that created this year’s his
toric slump in milk prices, and
predicted modest increases in
2003.
“Our problems marketing milk
began on September 11, 2001,”
he told a group of about 40 at
Daniel’s Farm Store here Tues
day evening.
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Co-ops Not Able
A drop in demand for milk
products after the terrorist at
tacks in New York City and
Washington resulted in an 11
percent decrease in milk sales,
according to Elliott. This slack
demand, plus a 3 percent domes
tic increase in milk production,
the problem of milk protein con
centrate (MPC) and other im
ports, and continued consolida
tion within the milk-handling
business resulted in 2002 being
“perhaps the worst year” in dairy
history.
“The biggest problem we are
having is the consolidation of the
industry,” he said. In Elliott’s
view, this has resulted in large
cooperatives that tend to look
after the interests of processors
over those of their farmer mem
bers.
“Are you working for the
farmer or working for the proces
sor?” Elliott asked in reference to
some of the nation’s largest milk
cooperatives. “You can’t have it
both ways. In order for there to
be a winner, there has to be a
loser. A co-op can’t do both.”
Some o r these competing co
ops are also involved in import-
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To Secure Gov’t Payments For Farmers
ing milk from Canada and im
porting MFCs from abroad, add
ing to the plight of domestic
producers, Elliott pointed out.
He urged dairy farmers to re
frain from doing business with
milk handling companies or
manufacturers that don’t take
care of U.S. milk producers first.
He also encouraged them to help
spread the word to consumers
about inferior milk products on
the market.
“Processed cheese made with
MFCs isn’t cheese as far I’m con
cerned,” he said.
Elliott cited American free
trade policy as another culprit
that allows inexpensive, substan
dard milk products to be im
ported into the U.S.
“We’re not going to change the
world,” Elliott said. “But don’t
support organizations that don’t
look after farmers.”
Pennsylvania dairy farmers
also face a drop in over-order
premiums for Class 1 milk in
2003 from $1.65 to $1.25 per
hundredweight by April. The
Milk Marketing Board said it
made this recent decision in
order to prevent processors from
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Lancaster Farming, Saturday, December 21,2002-A4l
looking elsewhere for cheaper
milk.
Even with all the challenges,
Elliott said that increased de
mand and other factors should
boost milk markets in the new
year. Citing economist predic
tions that milk prices will range
from about $l3 to $l6 in 2003,
Elliott said farmers can probably
expect an average of about $1.50
per hundredweight above what
they received this year.
“We are definitely going to see
a better price,” he said.
Elliott updated members on
milk income loss payments that
became available this fall under
the new Farm Bill.
For farmers who may be wait
ing for their co-ops to act as
agents in securing government
payments, Elliott had this to say:
“It’s not going to happen any
time soon.”
According to Elliott, by the
time the federal government ap
proves such an arrangement, the
program might be over.
“They’re already saying they
are running out of money,” he
said. “1 have this sneaking feeling
that this program is going to dis
appear before it’s supposed to.”
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Elliott favors the implementa
tion of a dairy compact such as
the one which expired last year in
New England states. Such a com
pact would set a floor price that
processors are required to pay for
milk and would not involve tax
dollars.
“We don’t need a government
check we need a stable pricing
situation,” Elliott said. “The
money needs to come from the
processors.”
To create a stable milk price
environment, the government
also needs to curb the flow of
milk products coming into this
country and stop basing the milk
business on a global pricing sys
tem, according to Elliott.
“Our milk should be priced
according to U.S. (supply and de
mand),” Elliott said. “You can’t
do business with your neighbors
if you have money and they
don’t. Everybody in the world
wants to trade here because our
consumers have money.”
Members at the Leola meeting
also heard updates from board
member Ken Marshall of New
York and Jerry McCleary, head
field inspector.
Pa. Junior Holstein
Convention Planners Gear
Up For 3-Day Event
BETHLEHEM (Lehigh Co.) The Pennsylvania
Junior Holstein Association Southeast district wel
comes all junior members to the 2003 Pennsylvania
Junior Holstein Convention. This exciting weekend
is planned for Feb. 7-9 at the Holiday Inn, Bethle
hem.
The theme this year is “Holsteins are Key in
2003.” We are looking forward to hosting all our
friends from across the state and showing you our
southeast hospitality.
Friday, Feb. 7 activities will include the prepared
public speaking contest, the annual meeting of the
Pa. Junior Holstein Association, a mixer complete
with a DJ for a dance, a few special surprises and
activities One of the contests we are having will be
to see who can bring the oldest Pa. Junior Holstein
Convention T-shirt and the most different Pa. Hol
stein Junior Convention T-shirts to this year’s
event. Prizes will be given for both winners.
Saturday is packed full of contests and activities
that begin with dairy bowl and extemporaneous
speech contests. Juniors are encouraged to get their
entries in for both of these state contests. There will
be an opportunity to ski for the day or snow tube in
the morning or afternoon at the Blue Mountain Ski
Resort. The convention hosts also have tours set up
to the Discovery Science Center and the Crayola
Crayon Factory, both local highlights in the area.
Watch for more information on these exciting activ
ities.
On Saturday evening, a buffet dinner will be
served followed by the winners of the prepared
speech contest delivering their winning speeches for
all to hear and enjoy. Following the meal and
speeches, a dance and again some special surprises
will be enjoyed by all.
Sunday morning will conclude with the awards
breakfast where many juniors will be recognized for
their achievements over the past year.
There will be a well-stocked dairy bar along with
commercial exhibitors who are available to share
their industry knowledge with the juniors. There
will also be the photo contest, display contest, and
plenty of opportunity to visit with your friends from
across the state.
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/ Morgantown PA \
/ * \
610-286-9052
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