The state’s dairy industry is closely watching Dean’s bankruptcy developments because Dean is the largest dairy processor in the country. It owns famous brands like Deans, Land O’Lakes, and DairyPure.
Early on in the process experts say nothing is likely to drastically change. Dean says it isn’t looking to close plants and is still honoring partnerships with other dairy companies. But the news is just another sign dairy farming is changing quickly.
People are drinking less milk and many processors and vendors are struggling to find new markets and develop new products.
Mark Stephenson, Director of Dairy Policy Analysis at UW-Madison believes Dean will focus on new markets and products as it restructures. He says if Dean closes plants as a part of that process, Wisconsin farmers will struggle to find new places to sell their product.
“If that happens, then milk will still be sold but it will have to go to another plant farther away and those plants would be paying more in transportation costs to get that milk from their farm to the plants,” Stephenson explained.
John Judd, a Mount Horeb farmer, says he used to sell to Dean Foods and knows several farmers who still do. He says there’s no reason to make drastic decisions based on today’s news but he’s telling friends who work exclusively with Dean to find backup customers.
“Better be in touch with their market, their field reps and management to make sure they have a market for their milk,” Judd said.
As for Dean’s announcement, Judd says he’s not surprised. He said he knows the dairy industry is struggling at all levels because the demand for milk is falling while farmers continue to produce large amounts of milk.
Dairy experts say the best case scenario for local farmers would be if Dean Foods either sells to a company that will keep its plants, or if Dean finds a way to keep its operations normal while it restructures.
