This article was #24 in PDmag's Top 25 most-well read articles in 2010. Jump to the article here.
Summary: The National Dairy Producers Organization was established in the early fall of 2010. Doug Maddox and Gary Genske, both on the board of directors, explain the goals of the organization, which include establishing a unified voice in the dairy industry and restructuring the national milk pricing formula.
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Progressive Dairyman Editor Walt Cooley discusses the formation of the National Dairy Producers Organization and its mission with two of the group’s organizing committee members, Doug Maddox and Gary Genske.
(Click here to listen to Editor Walt Cooley discussing this article with Truffle Media and DairyCast)
Q. How did this group get started? When did it begin?
MADDOX: Actually, I wrote a position paper on this when I was on the National Holstein Association Board 20 years ago.
I have felt for a long time that the dairy industry would benefit from a producer organization. However, the first discussions about this current effort started within the last three or four months.
GENSKE: We are legally setting up this organization as a 501C tax-exempt organization. That process is being accomplished right now. The organizing committee is roughly a dozen or so people from coast to coast and points in between.
Q. So how many members do you have, and how will it be organized?
We are charged with the responsibility of setting up initial bylaws. We have discussed in general terms the desire to have five delegates and two alternates from each state to represent the goals of each individual state.
Theoretically, there would be a national board of 250 people. We would have as, as with any of these kinds of organizations, an executive or operational committee of 15 people, or thereabouts, that would be charged with the responsibility of implementing the general consensus of the group, making sure things got done day-to-day. Those bylaws for this organization are being drafted right now.
MADDOX: I don’t know how many members we have to be honest. We haven’t really counted. We’re very early on to start counting members.
Q. There will be a membership fee of $80 per dairy producer. What other forms of funding will there be to support this organization?
GENSKE: If you consider 50,000 dairies at an $80 annual assessment membership fee, then you would have $4,000,000 and then on top of that we will be encouraging vendors to participate. I mean, for $80 what do you have to lose?
Q. What makes this organization unique from existing dairy producer organizations that also say they represent dairy producers?
MADDOX: The others are regional. What we’re finding is that as we have fewer and fewer dairy producers, we have a chance now to unite across the country. Whether you milk 50 or 500 or 5,000 cows, we’re all in this boat together.
GENSKE: When this group approached me and asked my thoughts on the whole thing, I said I’d love to join you because I’ve seen the need for a group only representing producers. By the way, I am a producer myself, a CPA-producer. Everybody that will be on this board or in this organization or have anything to do with it will be solely motivated by the needs of the producer.
Q. Why is this organization needed?
MADDOX: You know, one of the things that really spurred me on was the position that the International Dairy Foods Association (IDFA) has taken. They came out so blatantly against any major reform – against any kind of supply management. They really helped spur my energy to form this organization. IDFA is powerful. If we don’t unite, they would just run over us.
GENSKE: So that’s what our job is going to be. We’re going to have to work with all these groups, but at least, in my opinion, we’re going to help producers know more of the facts that influence situations that affect them.
MADDOX: One of the things that the last 10 years, specifically 2009, has taught us, and is one thing that all dairymen agree on, is that the status quo is not an option for us. So if status quo is not an option, what are the options and who will speak for the dairy farmers? Why not have dairy famers speak for dairy farmers.
Q. Why hasn’t an organization like this been formed before? Or if it has been attempted, what were some of the obstacles that prevented it from really gaining traction?
MADDOX: It’s a big industry, and it’s a big country. As I’ve been crossing the country working on the Dairy Price Stabilization Program as past president of the Holstein Association, I found it’s really hard to talk to everybody. And everyone has regional differences, and so I think it’s just been an insurmountable task and nobody driving to make it happen.
GENSKE: Another thing that we hear a lot is the question, “Well, how will that affect the smaller farmer? You big guys seem to run everything now. You’re running us out of business.”
But what happened in 2009 was it got so bad for all producers in this country that I think we all said, "All right, all these issues that we’ve kind of poked at each other about all these years really don’t mean anything when it comes to trying to get a milk price that will help us survive."
MADDOX: Our ultimate goal that really spurred this was that we want a fair price for the milk that we produce as producers.
GENSKE: We just want our fair share of the existing retail dollar.
Q. How will you challenge the status quo?
GENSKE: For example, here are some questions to ask: Why don’t we want country of origin labeling on dairy products? Why do we allow milk products to come into this country not fitting under the import tariff rate schedules? How do we allow milk to be imported into this country and offset up to 15 percent of our own domestic production?
I know the answer to these, but I mean, how does it happen? Those are two issues out of a list of about eight or nine items that need addressed. We’ve got to get the producers up to speed and put more of the relevant facts in front of them to help them make informed decisions on who ought to be on their board of directors and what their co-ops should be pursuing.
Q. Do you think your group will be in favor of or opposed to any form of supply management as a whole?
MADDOX: I don’t know. Basically, we’ll want to hear the producer voice. I was never in favor of supply management – never in favor of a base. I’m a member of California Dairies Inc (CDI).
For two years now, we’ve had a base, and you know, it’s not the end of the world. We dumped milk on our own dairy. We paid out of our check for milk that was being dumped for two years because we were so afraid of a base. Now we have a base. The co-op is making money again, and we’re not dumping milk, so what’s so bad about a base? I just found that it’s not the end of the world to have a base.
GENSKE: Our group will ultimately discuss and come to terms with some of these issues. But what is so bad with producers cutting back 2 or 3 percent for two or three months just to short the market so we don’t have an oversupply?
At times it’s so obvious that when we’re long on product, we don’t get paid. When we’re short on product, we get paid too much, so who’s going to control all that?
Q. What will be your greatest opposition to achieving your goals?
MADDOX: I am sure some organizations won’t be happy because they like to think they represent dairy producers, but we hope that we can convince them that we will enhance their program instead of detract from it. And the biggest obstacle, obviously, is getting in contact with dairymen across the country. Trying to find 50,000 dairymen isn’t easy. Will it happen? I don’t know. Is it worth a try? I sure think it is.
Q. What is the vision for where you see your organization a year from now?
GENSKE: My particular goal would be to have at least 20,000 member dairies in this group. I believe there’s probably a good 10 percent of the country’s dairies that probably won’t want anything to do with this organization, and that’s fine, but I’ll bet you there are at least 90 percent of producers who would be in favor of an effective organization like this. And that’s our goal is to become effective.
I would love to see a 20,000 dairy producer conclave in D.C. and to have a couple of politicians talk to us with the Capitol Building in the background on the mall in Washington. We need to talk about the issues that need addressed to stabilize the dairy industry in this country.
That’s a rather aggressive goal, but every time I’ve brought it up, people ask me, “When is that planned? When are we going to do that?”
We would expect to, within a year, to have our own political structure in place in the D.C. area. Our attorneys are on Pennsylvania Avenue. A national litigation firm is putting this organization together for us, so we’re very well represented. We’re serious, very serious.
MADDOX: I hope that we have a substantial number, several thousand members. I would love to have all 50,000, but that really is unrealistic. But if we have several thousand members, we will be the largest dairy producer organization in the country, and at that point, we will at least have a voice, and that’s what we want. We want to have a voice.
Q. Why is the formation of this group so controversial?
MADDOX: I don’t think it’s controversial with dairymen. For the average dairy farmer, status quo is not an option, and they’re ready for something else. We still have all segments of this industry, from co-ops to processors to retailers, so this will not be popular with everybody. It will be controversial to some, but not with dairy producers.
GENSKE: I don’t think it’s controversial at this stage. I think they’re skeptical of our success, which is probably the way I would characterize it at this moment. But this organization is going to be put in place, and it will be out there. We all recognize that if we work together, we’ll get things done, and we have the Spector-Casey group, the Costa group and people in between from each of the coasts so I’m very optimistic about our potential.
Q. Any concluding comments?
MADDOX: I wouldn’t say, “Why another dairy organization?” There is no national dairy producer organization. We’re not just another national dairy producer organization. There wasn’t one. But there is now. PD
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