Dairy coop sees profit of $14.9m

Dairy cooperative Agri-Mark made a profit of $14.9 million in 2009, its second-best operating result.

The cooperative's sales of fresh milk and dairy products under the name Cabot and McCadam were $655 million. The cooperative also paid $17.5 million in premiums to farmers throughout the year.

The financial return to farmers in a year in which milk prices dipped to lows last seen during the Carter Administration helped ease the pain, Agri-Mark spokesman Douglas J. DiMento said.

"We're not making enough to compensate for their losses but we're trying to make an impact," he said. "We've been successful because our farmers have invested in their own brands and markets for their milk. We have a good mix."

Agri-Mark represents more than 190 farmers in St. Lawrence County, more than 40 in Jefferson County, 85 farmers in Franklin County and 25 in Lewis County. Among its members are 75 Amish mostly in St. Lawrence County, a number that has been on the increase as the cooperative and the Amish build community milk houses that hold individual small bulk tanks. The cost of electricity, which is in Agri-Mark's name, is deducted from milk checks.

From its after-tax profit, Agri-Mark returned $5.6 million to its members. The cooperative made two payments to farmers before the year ended. The third payment for year-end profits was mailed this week.

During the past three years, the cooperative has generated a total of $45 million in profits during periods of both high and low milk prices, and both good and bad economies.

For 2008, Agri-Mark made a profit of $11.8 million. Its best year was in 2007, when it made a profit of $17.6 million.

Agri-Mark's profit return for 2009 to its 1,250 members in New England and New York was 45 cents per hundredweight of milk, representing earnings of roughly $9,000 for the average member milking 100 cows.

At a blend price of approximately $16.30 per hundredweight, the milk price paid to farmers has not rebounded as much as Agri-Mark had predicted it would, largely because more farmers than expected have hung on.

"The amount of milk production hasn't changed," Mr. DiMento said. "The question is, will the banks lend them the money to plant this spring?"

Agri-Mark will present its plan to improve and stabilize the milk price system March 15 in Washington, D.C., to the National Milk Producers Federation.

Agri-Mark's proposal is to set a base for all farmers. Production below the base would net a higher price for milk. Production over the base would result in a lower price.