Borden bankruptcy highlights woes facing dairy industry

In a sign of the continued woes of the dairy industry, Borden Dairy Inc, one of the counrty’s largest and oldest milk companies, filed for bankruptcy on Monday.

Dean Foods, the largest milk production in America, had earlier filed for bankruptcy this past November. While both of the companies cited multiple causes of their bankruptcies, one key factor was a 6% decrease in overall milk consumption in America in the past four years.

Borden noted that more than 2,700 family-owned dairy farms went out of business in 2019, and 94,000 family owned farms have stopped producing milk in the past 28 years. The wholesale cost of milk has been increasing due to fewer suppliers but retail prices are lower due to the decrease in consumption, Borden said in its bankruptcy filing.

The problems facing the two large companies come as no surprise to Washington Parish dairy producers, who have been struggling for years with rising costs and lower revenue.

One of the primary ingredients in the crisis facing the dairy industry is the fast-growing trend of consumers toward artificial milk products, such as soy milk, almond milk, oat milk, and other substitute milk products. This is believed to be a large part of the 6% decrease in milk consumption in America.

Dr. Mike Strain, Louisiana Agriculture Commissioner, once represented far western Washington Parish when he was a legislator, so he is well-acquainted with dairy issues. Commenting on the bankruptcy filings of Borden and Dean’s, Dr Strain told The Era-Leader, “Over the last decade, there has been a continued decline in the consumption of fluid milk. This decline has been precipitated by the introduction and marketing of a variety of imitation milk products and societal changes. In addition to non-dairy products being marketed as milk, many Americans families do not sit at the table especially for breakfast and eat meals when milk is traditionally consumed.”

Strain added, “Milk is one of the most complete and nutritious foods available and should be consumed as part of a healthy diet.”

One long-time dairyman in Washington Parish said that young mothers and other parents need to understand how important milk is for their young children. “Critical nutrition is not there” (in almond and other milk products), he noted.

But the monumental challenge facing small dairy producers in Washington Parish and large corporations such as Dean’s and Borden is: How can the decline in milk consumption be reversed? Until a solution is found, the problems in the dairy industry are expected to continue.