Barrows Farm blogress Doreen Barker has a very thoughtful and personal response to yesterday’s awesome City Pages hit-piece on supply controls used by Cooperatives Working Together to manipulate the national dairy market.
Price volatility makes dairy farming a notoriously tough business. It is not difficult to understand why an organization like Cooperatives Working Together would endeavor to mitigate some of the volatility on behalf of its membership, many of whom may feel ambivalence toward herd retirement, as does Ms. Barker.
CWT sought to manage that volatility, however, in a way that exposed it to legal liability. It could have hired a sales team to seek market for its members’ product, selling more milk to Fage/Oikos and foreign markets like China. Instead, CWT chose to press its Capper-Volstead anti-trust exemptions and tackle the issue of volatility from the supply side through herd retirement. This is a much more speculative strategy. Any organization that pushes the limit of anti-trust law runs the risk of litigation, and the outcome of litigation is never certain. You can’t chart a course like that without making a significant investment in legal research before you set off. Even still, some other smarty-pants lawyer from a public interest firm or the government could always disagree and mount a challenge. That uncertainty is risk, and it’s probably not the most stable foundation on which to maintain the financial well-being of your membership.