DOJ Announces Agenda for Dairy Hearing in Madison, WI June 25th

DOJ Announces Agenda for Dairy Hearing in Madison, WI June 25th
Posted by Dave on June 21, 2010

Today, the Department of Justice announced the agenda for the dairy hearing to be held next Friday, June 25th, in Madison, Wisconson to address issues of monopoly abuses in the dairy industry. As the third of five announced joint workshops held with the U.S. Department of Agriculture (USDA), the dairy workshop promises to be more robust and potentially emotional as dairy farmers have faced a cripling economic crisis for the past 18 months, which has seen the price they are paid for their milk drop between 40 to 50% since December 2008.

Abuses in the dairy industry are so rife that the DOJ has already filed two antitrust suits. in October 2009, the DOJ launched a suit against Dean Foods, the nation's largest processor of fluid milk and Dariy Farmers of America (DFA), the largest dairy cooperative, for monopolistic practices against New England dairy farrmers, a region where Dean Food controls 70% of the fluid milk market. Three months later, on January 22nd, Dean Foods landed in the DOJ crosshairs once again, challenging its purchase of Foremost Farms. The DOJ contends that the merger "eliminates substantial competition between the two companies in the sale of milk to schools, grocery stores, convenience stores and other retailers in Illinois, Michigan and Wisconsin".

The confirmed star studded line-up includes two cabinet members, one U.S. Senator, three U.S. House of Representatives and one governor among many others. Highlights include: Attorney Genery Eric Holder, Secretary of Agriculture Tom Vilsack and Antitrust Chief Christine Varney ( who have testified at the two previous hearings) Senator Russ Feingold, U.S. Representatives Tammy Baldwim, Ron Kind and Steve Kagen,Wisconsin Governor Jim Doyle and Wisconsin Secretary of Agriculture Rod Nilsestuen and Former Pennsylvania Secretary of Agriculture Dennis Wolff.

8:45 a.m. CDT	Opening Remarks The Honorable Eric Holder, Attorney General, U.S. Department of Justice The Honorable Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture

9:00 a.m.	Keynote Roundtable Discussion The Honorable Eric Holder, Attorney General, U.S. Department of Justice The Honorable Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture The Honorable Christine Varney, Assistant Attorney General for Antitrust, U.S. Department of Justice Tentative: The Honorable Herb Kohl, Senator, United States Senate The Honorable Russell Feingold, Senator, United States Senate The Honorable Tammy Baldwin, Congresswoman, United States House of Representatives The Honorable Ron Kind, Congressman, United States House of Representatives The Honorable Steve Kagen, Congressman, United States House of Representatives The Honorable Jim Doyle, Governor, State of Wisconsin The Honorable Rod Nilsestuen, Secretary of Agriculture, State of Wisconsin Invited: The Honorable Thomas Petri, Congressman, United States House of Representatives The Honorable David Obey, Congressman, United States House of Representatives The Honorable J. B. Van Hollen, Attorney General, State of Wisconsin

10:15 a.m.	Farmer Presentation of Issues This panel will be an opportunity to hear first-hand from dairy farmers as they share their experiences and perspectives on the industry. Moderators: The Honorable Eric Holder, Attorney General, U.S. Department of Justice The Honorable Tom Vilsack, Secretary of Agriculture, U.S. Department of Agriculture The Honorable Christine Varney, Assistant Attorney General for Antitrust, U.S. Department of Justice Dairy Farmers: Jamie Bledsoe, Riverdale, California Joaquin Contente, Hanford, California Joel Greeno, Kendall, Wisconsin Frances Horton, Hatch, New Mexico Ed King, Schuylerville, New York Bill Rowell, Sheldon, Vermont Christine Sukalski, Leroy, Minnesota Darin Von Ruden, Westby, Wisconsin

11:15 a.m.	Coffee Break

11:45 a.m.	Public Testimony

12:45 p.m.	Lunch

1:15 p.m.	Panel I - Trends in the Dairy Industry Over the past several decades, the number of dairy farms in the United States has steadily decreased, while the average size of dairy farms has increased. Most milk in the United States is produced under federal and state marketing orders and sold through cooperatives rather than directly by independent dairy farmers. At all levels of the industry, changes have occurred that have a significant impact on farmers, processors, retailers and consumers. This panel will examine these changes, the responses of industry stakeholders and the potential implications for regulation and enforcement. Moderator: Josh Soven, Chief, Litigation I Section, Antitrust Division, U.S. Department of Justice Panelists: Peter Carstensen, Professor of Law, University of Wisconsin Ron Cotterill, Professor of Agricultural and Resource Economics, University of Connecticut Bob Cropp, Emeritus Professor of Agricultural and Applied Economics, University of Wisconsin Jim Goodman, Organic Dairy Farmer, Wonewoc, Wisconsin Jerrel Heatwole, Dairy Farmer, Greenwood, Delaware Pete Kappelman, Chairman of the Board of Directors, Land O’ Lakes Cooperative Marcus Peperzak, Chief Executive Officer, Aurora Organic Dairy

2:30 p.m.	Panel II - Market Consolidation Firms that produce, process and sell milk and milk products have grown dramatically in certain geographic regions throughout the United States. While the growth of cooperatives and processors has almost certainly lowered production costs, in some regions there are concerns that there may be so few cooperatives and processors that the remaining firms can exercise market power against their customers. Processors may have also achieved sufficient size in some regions to exercise monopsony power against cooperatives and farmers. This panel will explore how such changes in firm size are affecting both farmers and consumers. Moderator: James MacDonald, Chief, Agricultural Structure and Productivity Branch, Economic Research Service Panelists: Calvin Covington, Retired Dairy Industry Executive, King, North Carolina Brian Gould, Associate Professor, Department of Agricultural and Applied Economics, University of Wisconsin - Madison Louise Hemstead, Chief Operating Officer, Organic Valley Cooperative Daniel Smith, Esq., Former Administrator, Northeast Dairy Compact Commission John Wilson, Senior Vice President, Dairy Farmers of America

3:45 p.m.	Break

4:00 p.m.	Panel III - Market Transparency Farm prices for milk have been subject to wide swings in recent years. Although likely the result of a multiplicity of factors, both domestic and foreign, some have raised concerns about the possibility of manipulation of fluid milk prices as a result of thinly-traded spot and futures markets for bulk cheese, butter and powdered milk. Others suggest that information disparities that result from long-term, full-supply contracts create perverse incentives that disadvantage farmers and prevent them from making optimal marketing decisions. This panel will examine these phenomena from the point of view of public policy options. Moderator: Mark Tobey, Special Counsel for Agriculture and State Relations, Antitrust Division, U.S. Department of Justice Panelists: Stephen Obie, Director of Enforcement, Commodity Futures Trading Commission Andy Pauline, Assistant Director, Government Accountability Office Tanya Rushing, Dairy Farmer, Tylertown, Mississippi Dennis Wolff, Partner, Versant Strategies, and Former Pennsylvania Secretary of Agriculture Robert Yonkers, Vice President and Chief Economist, International Dairy Foods Association

5:00 p.m.	Public Testimony

6:00 p.m.	Concluding Remarks