Farmers aim to tap into MPC market

WASHINGTON — Pick up an energy bar, and chances are it was made with milk protein concentrate, a powdery remnant of what thousands of cows across Northern New York produce every day.

Chances are slim, though, that north country cows — or any cow in the United States —had anything to do with making it. The milk probably came from farmers in Europe or New Zealand.

That might change in the future, if the latest push from some people in the dairy industry succeeds. Some businesses and farm groups are trying to build a milk protein concentrate business here that could give food companies an alternative to importing MPC, taking away a practice that has inflamed farm groups and put companies such as Kraft Foods on the defensive with Congress and industry critics.

"I think there's great opportunity," said Mac McCampbell, chief operating officer of O-AT-KA Milk Products Cooperative Inc., in Batavia, which makes and imports MPC for use in protein bars, dairy goods and other products. He said farmers would make more money if their milk could be used for such ingredients.

"Dairy farmers right now are going through horrific times," he said.

But the effort to grow that part of the business has raised new questions for lawmakers and others who want to curb imports. In New York, state Sen. Darrel J. Aubertine, D-Cape Vincent, has found himself fighting an unusual critic — fellow farmers — as he pushes a bill barring companies from labeling cheese as a real dairy product if it is made with MPC. The criticism came from New York Farm Bureau, which said the bill would squelch efforts to build the MPC industry in New York.

By the numbers alone, Mr. Aubertine would appear to be on farmers' side. The vast majority of MPC used in this country is still imported, replacing milk that could have come from U.S. dairy farmers. After tailing off for a few years, imports are climbing again. And most of the talk about an MPC industry seems to be little more than that; industry sources were unable to estimate how much is being made in New York and by whom, although O-AT-KA Milk Products Cooperative is both making and importing MPC for use in products at a plant in Western New York.

A spokesman for Mr. Aubertine, Drew Mangione, said using MPC from domestic milk does not run afoul of the bill. He likened that practice to making cranberry jam by cooking the berries just long enough to release the natural pectin, rather than adding store-bought pectin. "It's naturally occurring in the product," he said.

National statistics on MPC production are hard to come by, industry sources say, because the federal government has only just begun collecting production numbers from a few companies and may not report them until next year. Only one major plant, in Portales, N.M., produces it. That plant is owned by Dairy Farmers of America, the largest dairy cooperative in the country.

Although it has just one name, milk protein concentrate refers to a variety of products with protein content between 42 percent and 85 percent. It is low in lactose, making it an attractive ingredient for people who have trouble digesting that milk sugar. It also helps boost the amount of cheese that can be made from every pound of milk, meaning cheese plants can save money by using it.

Milk protein concentrate is made by separating skim milk into components, usually by running it through a membrane. Water, lactose and other components pass through the membrane, while casein and whey proteins are left behind and can be dried as much as necessary to reach certain protein concentrations.

As food scientists have learned more about the potential uses of MPC and similar dairy ingredients, the business has mushroomed into a significant — if largely invisible to the public — segment of the dairy industry.

"There's been a lot of growth," said Roger Cryan, vice president of milk marketing and economics at the National Milk Producers Federation, a group of farmer-owned bargaining cooperatives that is pushing for federal policies to make domestic MPC production more attractive. "In some ways, dairy ingredients is the most sophisticated part of the industry."

Companies put MPC in a wide range of foods, including protein bars, athletic beverages, cheese and yogurt. Sometimes it appears on lists of ingredients, but not always, meaning consumers may or may not know, for instance, whether a package of cream cheese contains MPC.

It has a murky status with the U.S. Food and Drug Administration, which has historically treated it not as a food product but for its more traditional and federally approved purpose — as an ingredient in glue. Milk protein concentrate has never received a "Generally Regarded as Safe" status from the FDA, which would typically follow testing for safety and nutrition, although food scientists at many universities say it is a beneficial ingredient.

Critics of MPC say the federal government should crack down on its use. But the FDA reported that a standard is not required from the agency for MPC to be used in food.

For several years, MPC was entirely imported. Those imports grew in the late 1990s and earlier this decade, costing New York farmers $96 million in lost milk sales in 2003, Sen. Charles E. Schumer's office estimated. Responding to complaints from farmers, Mr. Schumer and other lawmakers demanded that the federal government enforce rules against using MPC in cheese and slap tariffs on imports, which had been coming into the country without restriction. The National Milk Producers Federation, representing farmer-owned cooperatives, eventually caught on, supporting those efforts and publishing regular updates about MPC imports.

Former state Sen. James W. Wright, R-Watertown, wrote legislation barring companies from labeling their products as real cheese if they used MPC, and it passed both chambers of the Legislature, only to be vetoed by Gov. George E. Pataki.

By the time Mr. Aubertine proposed his own, similar version this year, the reality around him had changed and New York Farm Bureau was aligned with dairy processors pushing for domestic MPC production. Farm Bureau has urged Mr. Aubertine to revise it to protect companies such as O-AT-KA.

Mr. McCampbell said he has spoken with Mr. Aubertine and appreciates his concern for dairy farmers, but believes the senator might change his mind about some aspects of the bill if he were to tour O-AT-KA's plant and learn more about it products.

Even MPC supporters don't all agree on MPC's prospects in the United States, however.

The executive director of New York Dairy Foods Inc., representing the state's dairy processors, said the industry is unlikely to grow unless the federal government puts MPC on an equal regulatory par with powdered milk and other dairy products that are made and sold here. The federal Food and Drug Administration has no proposal to do so, a spokesman said.

The New York Dairy Foods director, Bruce Krupke, said he knows of no company in New York making MPC to sell, only to include in products already made at the plant.

And while O-AT-KA is bullish on MPC, Mr. McCampbell acknowledged that imports still have an upper hand because of the FDA's treatment of MPC as a non-food, while foreign countries have established MPC industries.

"If we were on a level playing field now, we wouldn't import any of this milk," Mr. McCampbell said.