DFA/Dean Foods deal is off – eDairyNews
United States |31 marzo, 2020

DFA | DFA/Dean Foods deal is off

After concerns were raised about competition and possible antitrust violations, Dairy Farmers of America and Dean Foods have agreed to drop a proposed bankruptcy purchase agreement.

Last month, DFA agreed to pay $425 million to acquire 44 processing facilities from Dean Foods. While that plan will not go forward, the paperwork filed with the bankruptcy court indicates DFA still plans to bid on some of the Dean Foods assets. The deadline for bids is March 30.

Dairy sector may request additional relief

As lawmakers work on additional coronavirus-related assistance, the National Milk Producers Federation is preparing to ask for dairy-specific relief from USDA and Congress. Government purchases for federal nutrition programs and food banks are being discussed as an option to help offset the demand disruption from school and restaurant closures. NMPF may also ask USDA to reopen enrollment for the Dairy Margin Coverage program.

Ag groups seek policy to help farmers navigate COVID-19

Provisions to help farmers and ranchers navigate current business challenges could be included in the third coronavirus package. American Farm Bureau Federation Executive Vice President Dale Moore said ag workers and a functioning supply chain are the most important things needed for agriculture at this time. “Our focus is making sure the men and women we’re working for have the tools they need to produce food and have the connectivity to other parts of the food chain,” Moore said. “I have a feeling it’s not going to be too long until we talk about a fourth or fifth tranche until we get this virus out of the U.S.”

A U.S. recession is possible

President Donald Trump told reporters the U.S. could be sliding into a recession. According to Wells Fargo agricultural economist Michael Swanson, there is a risk. The technical definition for a recession is two consecutive quarters of negative growth. “It’s very likely with the airline travel cancellations and meals away from home cancellations, the first quarter will show a contraction. The open question is if the second quarter will see a contraction. It all depends on how fast the virus is controlled.” Swanson said a recession doesn’t mean much for agriculture. “We’re more impacted by the strength of the dollar. Right now, the U.S. dollar is really strong. That probably has more of an impact of pricing of agricultural commodities in the short term. Longer-term, not so much.”

Ag declared as a critical industry

Agriculture and food have been declared by the United States Department of Homeland Security as critical infrastructure during the coronavirus outbreak. This allows ag businesses to continue normal operations, despite restrictions to stop the spread of the virus.

NFU elects new president

The newly elected National Farmers Union President Rob Larew said he will focus on building off of the current strength of the organization. “Times are tough. There are lots of challenges, not the least of which is what the weather will be like this spring. When we work together, we’re going to be a lot stronger.” Larew said the farm economy continues to drive a lot of policy priorities for the organization. “The effects of trade policy, whether or not we get another Market Facilitation Program and whether or not we need to be looking at changes in the farm safety net. Then, there are challenges of concentration across the ag space and climate change.” NFU Policy Director Mike Stranz will be filling in for Larew’s former role. Wisconsin farmer Patty Edelburg was also reelected NFU vice president during the convention.

NFU supports supply management

During the National Farmers Union Convention, delegates passed six special orders including one dealing with dairy policy. This special order said the Dairy Margin Coverage program does not address the issue of oversupply and Congress should establish a mandatory supply management program. NFU said this program should allow for the entry of beginning farmers, reduce government expenditures, respond to global market conditions, allow for on-farm processing, value-added and direct-to-consumer sales and be designed in a way that any production base does not acquire value.

Evers signs ag bills

Wisconsin Governor Tony Evers has signed a slate of 60 bills, including provisions impacting agriculture. One of the bills adjusts the formula for tax credits, allowing farmers to claim their full credit after farmers receive federal crop insurance for crop losses. There was also a bill signed into law that creates a system for buying and selling nutrient credits for farmers who hold a water pollution discharge elimination permit.

A merger at UW-Madison

The animal sciences and dairy science departments at the University of Wisconsin-Madison will merge on July 1. These two departments have already been working as one unit since January 2019, but the merger has now been officially approved.

Dairy leaders to be honored at World Dairy Expo

World Dairy Expo has announced the recipients of the 2020 Expo Recognition Awards. The Dairy Producers of the Year are Jim Ostrom, John Vosters and Todd Willer of Milk Source in Kaukauna, Wisconsin. Steve Eicker of New York and Conner Jameson of California are with Valley Agricultural Software and will be recognized as the Industry People of the Year. Wijnand Pon, who is the URUS Group in the Netherlands, is the International Person of the Year. The awards will be presented during World Dairy Expo.

PDPW Board elections

Three incumbents were reelected to the Professional Dairy Producers of Wisconsin board. Andy Buttles, Lancaster, Steve Orth, Cleveland and Katy Schultz, Fox Lake, were elected to their second three-year terms during PDPW’s Virtual Business Conference.

Holstein farmers recognized

The Wisconsin Holstein Association honored Trent and Kelsey Hendrickson of Blanchardville as the Distinguished Young Holstein Breeder. Kevin Jorgensen of Waupun was presented the Distinguished Service Award. Jorgensen worked for nearly 30 years in the A.I. industry and is a former president of the Wisconsin Holstein Association.

Trivia challenge
Former Agriculture Secretary Tom Vilsack is the president and CEO of the U.S. Dairy Export Council. That answers our last trivia question. For this week, what country drinks the most milk on a per-capita basis? We’ll have the answer in the next edition of Dairy Star.
Don Wick is owner/broadcaster for the Red River Farm Network, based in Grand Forks, North Dakota. Wick has been recognized as the National Farm Broadcaster of the Year and served as president of the National Association of Farm Broadcasting. Don and his wife, Kolleen, have two adult sons, Tony and Sam, and five grandchildren, Aiden, Piper, Adrienne, Aurora and Sterling.

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