Dairy production

jacksun65

Well-known Member
I just read Where Foremost Farms is putting in a dairy processing facility in Greenville MI. Was also in eastern Indiana where Dannon was putting in one also some were not happy about that. With the price of milk so low how can these companies make money to put up these facilities?
 
The current consumer fad is to be 'in tune' with the farmer their food comes from, and these companies are trying to meet that fad by controlling the entire process from the cow to the store shelf. Then they can put pictures of individual cows in pastures and farmers with a pitch fork and say see this cow helped produce your bottle or quart of dairy product. While true, it still ends up being a huge company processing plant, not the down on the home farmer image presented.

Such products can sell for a premium price to the richer folks who now 'feel good' because they know where their food comes from, heck they see a picture of the very cow that was milked just for them!

When fads change and prices change, these companies will have used the profits of today to pay of their investments and now control a bigger slice of the pie - they have more control (and so income from) the entire process. They are careful to own only the parts that give profit and control of products, they will not own everything. They pick out the best odds of the best parts of the process.

Business wise it is well thought out business model, they will do well for now, and fairly good planning for the future as much as one can.

Ethically, it is taking a confused public's good intentions but total lack of understanding and using it to profit while dumping on those the general public thinks they are 'in touch' with......

A simple black and white view of a complicated, multi-sided situation.......

Paul
 
Such products can sell for a premium price to the richer folks who now 'feel good' because they know where their food comes from, heck they see a picture of the very cow that was milked just for them!

After touring a nearby dairy that supplies another large dairy I no longer want to buy their products..(cheese,milk, yogurt and ice cream. I didn't find their dairy to be clean and some of their practices are in humane. I suppose if I saw the process of where some of my other food came from I would not want to eat.
 
I do large project engineering for food companies. I am not involved with the projects noted in the original post but currently involved with similar projects with other companies. The food processing industry is going through a wave of consolidation and improving efficiency. In short they are building new plants to be able to shutdown old plants. The new plants are more highly automated and streamlined. The old plants are just getting too old and inefficient. A lot of the current food processing facilities where built in the 1960s and 1970s. They need to keep them running to meet current consumer demand but everything needs to be updated. It is cheaper to build a new plant and shutdown the old plant. Trying to make large updates to an existing plant and keep it in operation is just really difficult. This also gives them the ability to negotiate with local governments to get economic incentives to build the new plant in their town.
 
There is always someone not happy about something. And the price of milk is low for the farmer not the processor, I am sure Foremost is turning a profit for its members! Dannon was just sold to someone but can't remember who, computer is really slow and I don't have the patience for it.
 
Michigan needs more milk plants. They have some of the lowest priced milk in the region now, so new plants can buy producct affordably. Dairy plants do well when the milk price is low, as their retail price does not drop to the same effect (especially for unique products) as the input price (milk ) does.

They really whine when milk pay prices are high.
 
...Now you and I both know that a picture of a cow in a pasture and a farmer holding a pitchfork will have to be photoshopped because the likely hood of that is rarely found today. We might as well throw in the picture of a farmer in bib overalls wearing a straw hat sitting on his narrow front tractor also. I agree with what you say about the farm to market mentality. One of my brothers has worked for a couple nationally known brands. At one he was in charge of R&D and his contributions are still on store shelves and restaurant tables. He commented several times on the total lack of understanding they saw in the consumer feedback regarding where the general public's food actually comes from. In small town USA we still have local bakeries and butcher shops and generally have an understanding of the food chain. Conversely I've seen the trend for health markets and food coops in bigger cities for those trying to feel better about themselves.
 
Whaddya mean- no more farmers in bibs with a straw hat? Ain't you never seen Randy Lund??????
 
I hear about the local farm to table initiative. I see some TV programs about local producers in large cities farming organically on a small scale. It sounds good and feels good. I just don't think people realize the scale required to feed the country. I don't see it making a substantial dent in overall food production.
 
Our dairy coop is making record profits and expanding/renovating substantially with the bargain milk prices.
 
Sure hope what you read is true. We need all the jobs we can get in the area, and the dairy industry will take any thing that might help their prices edge up. There have been rumors for quite sometime, but I?ve not heard anything official.

Do you mind sharing where you found the article?
 
Dannon is actually in Ohio but about 20 mile from the Indiana border. They are a Yogert prossening plant and decided to build their own dairy farm, extra large and quit buying milk from local dairies. The place they picked for the dairy heard has no place for manure disposal for the few thousand cows they are planning. They would meed a plant as big as all the towns in western Auglaize county combined. Then all that milk will be going thru one of the largest towns in the county to get to the town the plant is in. When they get that farm up and running a bunch of local dairy farms will be put out of bussiness that curently sell to Dannon. Where they are building that dairy is where I had my van totalled in 15 when 2 semi sideswiped with me in middle of wreck. That dairy there will be no way to control manure smell and fly problems. They just want to get rid of all their milk supliers and control everything.
 
It all comes down to whether they are buying milk or selling milk. Two completely different prices.
 
Hey,I resemble that remark! LOL

The guy and gal in the American Gothic painting were actually the artist's dentist and sister though weren't they?
 
With the price of milk so low how can these companies make money to put up these facilities?
The low price of milk is a big factor in why they can put up these plants. Buy it cheap add a little value and sell it for big money...
 

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