New Report Exposes Corporate Monopolies Driving U.S. Dairy Crisis

A new report released today from the national environmental advocacy group Food & Water Watch details how corporate food monopolies drive the U.S. dairy crisis, pushing family farms out of business and slashing on-farm profits.

The report is the third in a series outlining the harsh economic costs to consumers, rural communities and farmers of corporate monopolies throughout the American food system.

In the report — “The Economic Cost of Food Monopolies: Dirty Dairy Racket” — Food & Water Watch analyzed changes in the U.S. dairy industry over the past several decades to find how corporate farm policy has led to the expansion of polluting factory farms at the direct expense of sustainable small-scale dairies. Specifically:

• The U.S. lost almost 70 percent of its family-scale commercial dairies between 1997 and 2017. Today, only about 30 percent of all U.S. milk is produced on family-scale farms.
• Since 2000, the average U.S. dairy has managed to turn a profit just twice. Much of that is due to increased production costs and plummeting real milk prices which dropped 20 percent from 2000 to 2021, thanks to the gutting of federal supply management policy.
• 83 percent of milk sales are marketed by three dairy cooperatives (the DFA, Land O’ Lakes, and California Dairies, Inc.). Since 1970, one third of U.S. dairy processors have gone out of business.
• These trends have serious climate implications: From 1990-2020, the shift to larger operations resulted in a doubling of annual methane emissions from dairy manure management, despite the fact that the number of cows remained the same.

Food & Water Watch Food Policy Analyst Rebecca Wolf said:

“Corporate consolidation is at the heart of our food system’s dysfunction. Corporate-directed policy making is throwing America’s dairy industry into crisis. Family-scale dairies are collapsing at an alarming rate, and those that manage to hang on face rising costs, negative returns and mounting debt, while consumers are sold an illusion of pastoral, sustainable milk products. The next Farm Bill is a critical opportunity to reverse course, by restoring supply management and reforming the farm safety net. Passage of the Farm System Reform Act and Food and Agribusiness Merger Moratorium and Antitrust Review Act will help ensure we stop digging a deeper hole by halting consolidation and factory farm proliferation.”

“Dairy farm families, we have our backs against the wall,” said Wisconsin dairy farmer Sarah Lloyd. “We need prices that are fair, covering our cost of production and giving us a return to maintain our businesses and make a living. Overproduction and consolidation in the industry are making this increasingly difficult if not impossible. Powerful agribusiness interests and corporate backed politicians only offer us more exports as a policy response. We can’t export our way out of this problem. We need to manage the growth of dairy supply and we can do this with solid dairy policy that looks out for farm families and rural communities and not corporate profits.”

“Food and Water Watch has done a great job of describing today’s dairy crisis. They are right on target that we need to stop the monopolization of dairy markets, stop the proliferation of unsustainable mega dairies, and implement a supply-control system for dairy production in the U.S. Without supply management, small and mid-size dairies cannot survive,” said Iowa dairy farmer Francis Thicke.

State policies mirror federal action, compounding the dairy crisis from coast to coast. Traditional and new dairy states New York and Oregon, respectively, illustrate the national trends. Since 1997, New York lost more than half its dairy farms, while over the same period, the number of cows raised on Oregon factory farms with more than 500 head quadrupled.

“The current paradigm in our country has enforced a policy of ‘get big or get out’ for dairy farmers in Oregon and across the country,” said Alice Morrison, Co-Director of Oregon-based Friends of Family Farmers. “Pausing the proliferation of factory farms in Oregon is a first step in moving back toward an environment where family farms of all scales had a possibility to thrive in the system. An agricultural system that prioritizes these gigantic facilities over all others drives land prices up and out of reach of small and midsize farmers, uses more than its fair share of water resources through abuse of the stock water exemption in a state suffering from persistent drought, and monopolizes processing infrastructure so there is no way for independent Oregon farmers to legally bring their products to market. This is not about choosing winners or losers in farming based on size, it is about addressing conditions that make it impossible for anyone to win. Not only do we need to protect our natural resources so that Oregonians can farm for generations to come, we need to foster an environment where it is possible to thrive as a small or midsize operation.”

For more on The Economic Cost of Food Monopolies report series from Food & Water Watch, see Grocery Cartels, detailing exploitative retailer monopolies and their impacts on consumers; and Hog Bosses, detailing the rural economic collapse in Iowa farm country at the hands of hog factory farming.