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As dairy farms face challenges, Oakhurst launches campaign to promote Maine milk

Posted Jan. 28, 2013, at 3:10 p.m.
Dairy farmer Dick Perkins pets one of his Holsteins and calls her by name as he walks one of his cow barns at his Chaleston dairy farm in November. Perkins is just one of many Maine daily farmers who will be affected when Garelick's Bangor milk processing plant ceases operations.
Dairy farmer Dick Perkins pets one of his Holsteins and calls her by name as he walks one of his cow barns at his Chaleston dairy farm in November. Perkins is just one of many Maine daily farmers who will be affected when Garelick's Bangor milk processing plant ceases operations. Buy Photo

PORTLAND, Maine — The closure of Garelick Farm’s dairy production facility in Bangor could have a much more widespread impact on Maine’s dairy industry than originally realized.

As a result, Oakhurst Dairy in Portland has launched a marketing campaign to educate consumers on the importance of buying Maine milk and supporting the state’s dairy industry.

When Texas-based Dean Foods announced in October that it was closing the Garelick facility, the direct impacts were clear — 35 lost jobs and the loss of a processor for the dairy farms that sold its milk to Garelick. But Tom Brigham, co-president of Oakhurst, said the effects could be much more widespread across the state’s dairy industry.

For every gallon of milk that is farmed, bottled and sold in Maine, 13 cents goes into the Maine Milk Pool, a fund established by the Maine Milk Commission to support the state’s dairy farms.

In question is how the closure will affect funds paid into the pool. Dairy processors in the state pay a small fee into the pool, which then is disseminated monthly to Maine’s dairy farms to help make a dent in the significant difference between what it costs farmers to produce a gallon of milk and what they receive from processors for that same gallon.

It costs Maine dairy farmers $30 to produce a hundredweight — which is approximately 12 gallons — of milk, according to new cost estimates from the Maine Milk Commission. However, Maine dairy farmers received roughly $20 per hundredweight for their milk in February, according to the commission.

The fear is that with the closure of Garelick’s Bangor facility, the Maine milk that previously remained local now will be shipped to Garelick’s other facilities in Massachusetts, processed and then shipped back into the state and sold to Maine consumers, Brigham said.

If that happens, Garelick no longer would pay any money into the Maine Milk Pool, an annual loss of as much as $600,000, Brigham said. That could mean that, on average, each of Maine’s 350 dairy farms would lose nearly $2,000 a year.

That is not an insignificant number given the challenges farmers already face, including high feed and grain costs driven by drought conditions in the Midwest during the last growing season, Brigham said.

“A small farm would probably get significantly less than that [$2,000], but a large farm would get significantly more,” Brigham said. “But to any of them, it’s a meaningful amount.”

Oakhurst began to accept milk from two of the farms that previously sold to Garelick in Bangor, but that was all the capacity it had, Brigham said, which means there’s a good chance the rest of it will head out of state.

The campaign is “not a huge splash,” but more geared toward educating consumers, according to James Lesser, Oakhurst’s vice president of marketing. It will include a website — www.keepyourmilkinmaine.com, which went live on Monday — along with print advertising in the northern half of the state, where the Garelick brand is strongest, a vestige from when it was Grant’s Dairy, Lesser said.

“Maine people are loyal to their state and everyone is trying to do what’s best for the local economy, and that’s really the intent of this campaign — provide the information so people can make educated choices,” Lesser said. “At this point in time, we want consumers really to understand that to help Maine dairy farmers, the best thing you could do is check that label, look for the Maine quality seal and buy a product they know is farmed, packaged and sold in Maine.”

The educational campaign is obviously a good marketing tactic for Oakhurst, Brigham said, but it’s also part of a long-term survival strategy.

“Without dairy farmers, we don’t have a business,” Brigham said.

“We have a business built on the phrase, ‘The Natural Goodness of Maine,’” Brigham said, referencing the company’s tagline. “We want to see the Maine dairy industry remain strong and vibrant, and we always want to be able to source as much milk as we need from Maine dairy farmers. The best way to help Maine dairy farmers is try to get as much of that volume that could be lost — money that goes out of the Maine Milk Pool — try to get that money back into the Maine Milk Pool for their benefit.

“We’re hoping through this campaign — this idea of ‘Keep Your Milk in Maine’ — we can make consumers aware of what’s happening and aware of how their purchasing of a milk product can impact Maine dairy farmers positively.”

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