Federal Justice official to hear dairy complaints

WASHINGTON — The chief antitrust enforcer at the federal Department of Justice will visit Genesee County later this month to hear complaints about lack of competition in the dairy industry.

Sen. Charles E. Schumer, D-N.Y., who had pushed the DOJ to look harder at dairy industry practices, announced that Christine A. Varney, chief of the Antitrust Division, will visit on March 29.

Mr. Schumer, who plans to join her at the meeting with farmers and consumers, pointed in a press release to the increased spread between prices paid to farmers and by consumers.

"It just doesn't add up and we need DOJ's help to peel this onion and identify some of the problems plaguing our family dairy farmers and milk consumers," Mr. Schumer said.

The Justice Department has visited the issue previously, but backed off a major investigation during the Bush administration. That inquiry led to interviews with many dairy industry representatives and appeared directed largely at alleged collusion between large processors and farmer-owned cooperatives.

Officials never explained why the case fizzled, nor did they comment at length about its existence.

While much of the focus has been on the Southeast, dairy industry sources also point to New England and New York as grounds for complaints about lack of competition.

At issue is whether two companies — Dean Foods and the Dairy Farmers of America cooperative — have captured so much of the beverage milk market that competition has all but disappeared. Dairy Farmers of America is the dominant cooperative in the state, selling milk to dairy plants through a partnership with Dairylea Cooperative Inc., Syracuse.

Without access to the beverage milk market, farmer-owned cooperatives lose out on payments through the federal milk marketing orders.

But interest groups for dairy processors counter that competition in New York is more robust than critics claim, and that many small cooperatives still compete for farmers' milk.

In addition, cooperatives are largely exempt from anti-trust laws; otherwise, farmers would not be able to pool together to sell milk to the extent they do.

Mr. Schumer's office said that people who want to attend the event must RSVP to the senator's office, at dairymeeting_schumer

@schumer.senate.gov, no later than March 24. Those wishing to speak at the event should include an outline of the subject they would like to discuss, Mr. Schumer's office said.