The Justice and Agriculture Departments have launched a new task force to consider how to promote competition in the agriculture industry, Assistant Attorney General Christine Varney said at a conference on competition in the dairy business in Madison, Wis. on Friday.
The task force will review enforcement of the Packers and Stockyards Act, according to Varney’s prepared remarks. That law regulates the livestock and dairy industries and prohibits them from engaging in unfair practices. The law is administered by the Department of Agriculture.
Today’s workshop is the latest installment in a series of town-hall meetings on competition issues in agriculture. The DOJ heard from poultry farmers in Alabama last month and discussed the seed industry in March in Iowa.
The Wisconsin workshop focused on the state’s $26 billion dairy industry, where farmers are unhappy about the low prices they are paid for raw milk.
Sen. Herb Kohl (D-Wis.), who urged Varney to include the state in her agriculture itinerary and was on hand at the conference, said retail prices for dairy products have not kept pace with the sharp declines in farm milk prices. That discrepancy, he said, according to prepared remarks, has lead him to question whether consolidation in the industry had given some firms too much power in the market.
“We have to ask if our farmers are getting a fair shake,” said Kohl, who chairs the Senate Judiciary antitrust subcommittee.
Varney said the Justice Department was tracking the development. “[W]e are keeping a watchful eye on this industry,” Varney said. “We know that dairy farmers are concerned about a lack of choices for buyers, about the way that their milk is priced, and about a year of dispiriting returns for their labors.”
The Agriculture Department has predicted that farmers will receive around $1.35 for a gallon of milk this year, down 30 cents from 2007, according to the Burlington Free Press, and it’s a problem for which farmers largely blame large dairy processors and co-ops.
The Antitrust Division sued Dean Foods in January alleging that the dairy processor’s acquisition of two Foremost Farms processing plants in Wisconsin last year removed competition in the milk industry.
Varney said at the panel she has heard from large co-ops and they are working to be more transparent and accessible to member needs, according to Dairy Farmers of America spokeswoman Monica Massey’s tweets from the event.
According to the magazine Progressive Dairyman, Varney also said: “We have a pro-farmer agenda and will take that where ever it leads us.”
Around 500 people attended the workshop, according to the Associated Press.
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