cows in field

Update on the Organic Dairy Crises in the Northeast

By Ed Maltby, NODPA Executive Director

The loss of contracts for 135 organic dairies in New York and New England is a continuing crisis. The Northeast Dairy Task Force has reported out their 35 recommendations; Danone has replied to the petition request from 16,000 consumers and organic groups representing producers; the B Corp has supplied an non-answer to the complaint (a separate petition) by over 8,000 consumers and many organizations that they should enforce their standards; testimony has been presented to Congress on the corporate monopsony that controls supply and pay price in organic dairy (see Testimony article, below) and Gary Hirschberg has launched a partnership with consumers to support organic dairies with their food dollars (see NOFFP article, below). We have more information on what farms are affected and a timeline for decisions from CROPP Cooperative on when farms might know whether they are being taken on board (see Contract Dump article, below). Unfortunately we are still at the information stage despite all this activity which doesn’t lessen the stress for the affected farm families. There are no silver bullets but plenty of opportunities in the mix that we will continue to explore, and will keep putting pressure on.

Danone and their search to justify their B Corp social responsibility commitments

On the morning of December 13th 2021, the producer groups representing organic dairies issued a press release critical of Danone’s delay in answering their request to repair the damage that leaving the entire Northeast region will have on the farm economy and rural communities. That evening, following a media blast, Danone responded to the request from NODPA, NOFA NY, NOFA VT, NOFA NH, MOFGA, OFA and many other groups and 15,000 + consumers. In their response, they explained their ‘four-part Northeast Organic Dairy Transition Plan’ to provide ‘additional and meaningful support for the affected farmers and the region.’

They announced they will meet one of the requests of northeast organic producer groups. They will provide the affected producers with the option to extend their current contract for a total of 18-months, ending on February 28, 2023. They did not meet the request that they offer a contract severance package or contract retirement package. They did provide a small transition payment of an additional amount per hundredweight on the milk purchased from the producers during the last 6 months of their contracts, (6% of the milk check for 6 months or $2 per hundred pounds of milk). This money will also be paid to farms that have stopped shipping to Danone but received the non-renewal notification- IF you are in this group of no longer shipping to Horizon and Don’t Receive the payment by March 1st – Call and ask for it, or contact NODPA or your organic service provider. Danone will also provide farm consultants at no charge to the affected farms and explore co-investment solutions for northeast dairy infrastructure. Any questions on contract issues or request for financial assistance from Farm Credit should be directed to Danone field representative or to Greg Wolfe at or (330) 280-2747. Any producers that have difficulty with the process and do not get satisfaction from Danone should contact NODPA or one of their regional organic providers.

Danone sent letters to every group, every member of Congress and any group that objected to the way they treated their loyal farm ‘partners’ to explain the actions they had set in motion the previous week. They sent a press release to news outlets explaining that they are a responsible company.

On Friday afternoon 12/17/2021, a 30 minute zoom call with Danone and producer group representatives took place to get more clarity on the proposals. There was a clarification from Danone that the contracts incorporating the extension by 6 months to the current contracts, that these producers will have the same conditions for a pay price and terms for cancellation. The 30 day cancellation will be in all the contracts to enable producers to end their contract easily if they had a new buyer or could not continue organic dairy production. Danone stated that they would not drop farms because they are too few farms on the trucking routes as some farms leave. Danone also confirmed that the payment would be an extra $2 per hundred pounds of milk for their last 6 months of production under contract with them. That is equivalent to a market premium (MAP) that the company has paid at others times. To be very clear, this is not an extra payment based on 6 months of milk averaged over the last three years at an increase of $2 per cwt which USDA has paid out recently with COVID payments. This is only $2 added to the pay-price for those last six months. This would still be less that the pay price in 2017. When asked what their thinking was behind the amount they paid out, the reply was a rather testy one that this was something they would not discuss; refusing to discuss any aspect of this payment. We were left with various assumptions on how and when these payments would be made. For those producers that need to upgrade their farms to meet conditions from a new buyer, these payments are inadequate and not timely. For those farms that want to set up an alternative venture, these payments will be too late to ease the stress. The chart below gives an indication about how much money, on average, a producer would receive, accepting that there is no ‘average producer.’ Producers should sign contracts and re-sign or initial amendments to contracts. If a field rep says you can do something different ask them to sign a statement to that effect before they leave the farm. Creating a legal paper trail does not mean you don’t trust the company or their employees, you just never know when you will need a verified record.

Average annual production for organic dairy cow *



Turn lbs. into cwt



6 months is 1/2 a year **



Payout per cow at $2 per cwt

$ 140

50 cow herd payout at $2 per cwt

$ 7,000

100 cow herd payout at $2 per cwt**

$ 14,000

200 cow herd at payout of $2 per cwt

$ 28,000

Amount Danone would pay for all 89 herds using VT Dept. of Ag calculations of volume of milk from the 89 farms presented to USDA NE Dairy Task Force in November 2021


* Depends on breed and nutrition. Jersey or Jersey cross would be less as would Grass Fed

** the six month prior to September would be the time of the Spring flush so might be more than 1/2

The last 15 minutes of the zoom meeting was spent attempting to get some clarification from Danone about how decisions would be made on their investment in the region. They refused to confirm a dollar amount. They said that all projects could be acceptable for funding but they preferred a transportation cooperative after discussions with other milk buyers with no confirmation of what they actually meant by it. A new milk processing plant was not high on their list of priorities as they saw that the problem was in trucking, not processing. They had had a call with state of Vermont and Maine and were open to talking with New York. They have wrongly assumed that the USDA Northeast Dairy Task Force was a product of Vermont not the whole of the northeast. The impression they gave was that they had no specific allocation of money or process dedicated to ‘co-investment solutions that will address some of the systemic challenges related to northeast organic dairy infrastructure.’

Northeast Dairy Task Force Report

After a lot of hard work by many people, the USDA Northeast Dairy Task Force had its final meeting on 12/3/2021 and sent its final report to the USDA on 12/20/2021. The Task Force had representation from 27 unique organizations including state departments of agriculture, university extension, organic processors, organic associations, farm technical assistance providers, and subject matter experts. The final meeting was able to see the reports from the 6 subgroups: Expansion of Processing; Distribution Logistics; Federal Response; Farm Business Viability; Institutional Purchasing; and Marketing. The Farm Business Viability group recommendations dovetail with those from the Processing Expansion and Distribution Logistics sub-groups. In order to achieve systems change, all three must be developed together. The Marketing sub group highlighted that it will require a sustained and substantial increase in demand for the region’s organic dairy processors to be able to absorb the milk from the dairies that are losing their contracts, without exacerbating oversupply issues. The best way to generate this increase in demand is through marketing activities that will encourage consumers in the region to choose local organic dairy products. This also will need increased infrastructure as the necessary increase in demand for dairy processing exceeds the available infrastructure, plus there will need to be greater transparency in where milk is sourced to ensure product integrity. In the introduction to the Federal Policy recommendations, the report said, “A variety of federal policies and programs influence organic dairy production systems, enforcement of the organic standard, and the availability of information regarding organic dairy production. ……….USDA has an important opportunity to ensure that its policies on everything from organic certification to FMMO to the use of new federal infrastructure funding are treating organic dairy producers fairly and supporting them in accessing markets.” NODPA recommendations included greater enforcement of the pasture rule; publication of a Final Rule on Origin of Livestock with the provision that transitioned animals cannot be sold as organic for milk production; greater transparency and organic data within the Federal Milk Marketing Order; grant funding to create a market and infrastructure for a regionally branded milk; and a moratorium on payments for principal and interest on debt. In addition, there was a great presentation from Diane Bothfeld, Vermont Department of Agriculture, about a short-term Financial Gap program that could be used if a producer could not find an organic market immediately but still had cooperative membership in the conventional market. The program would allow the farm to continue to be organically certified by covering the pay price difference between the conventional price and the organic pay price to cover the increased cost of continuing to purchase organic grain and other higher priced organic inputs. While the pay price being considered is only the break-even pay price for organic production in the northeast, it will compensate any farm family that can’t find an organic buyer in this tight market but still wants to farm organically. Once you feed organic animals any non-organic feed they cannot return to organic production, so any farm that has to feed conventional feed but wants to go back into organic will have to purchase new organically certified cows. While its not a program that will make any farmers profitable or put off retirement with a steady income for working 7 days a week, it could be a good stop-gap measure.

The Northeast Dairy Task Force, collaboratively led by Laura Ginsburg – Northeast Dairy Business Innovation Center lead and Britt Lundgren – Stonyfield Organic director of organic and sustainable agriculture, offers USDA leadership the recommendations they asked for to support the region’s need for long-term systems change in the organic dairy sector. The northeast region, New York and New England, is a natural food shed for the large consumer areas of the east coast and this was a great example of working together as a region to introduce new opportunities and competition for organic dairy.B corp logo_thumb

B Corp and their Non-Answer on Accountability of their Standard

Below is the letter that we received from the B Corp Standards Management Team. I thought it best to print it all as it is difficult to do an unbiased summary:

We appreciate your patience in our response, and thanks to you and the petition signatories for playing your role in the accountability mechanisms established as part of the B Corp Certification process. We take complaints against companies who have achieved B Corp Certification very seriously, and as such it sometimes takes more time than stakeholders desire to provide an appropriate response.

B Lab acknowledges and is deeply sympathetic to the fact that the farmers affected by this decision find themselves in a difficult financial situation that may affect their livelihood and well-being. Certified B Corps are expected to make decisions with consideration of the impacts on stakeholders in mind. While these decisions may still nonetheless lead to a potential negative impact on a particular stakeholder group, it is also considered how a company engages in ways to mitigate that negative impact to the extent possible.

Upon reviewing the information available, including the information shared in the petition, and considering the stakeholder concerns raised and the impact on affected farmers and communities, we have determined that Danone North America’s certification is upheld with disclosure of this situation required on its B Corp public profile in order to be transparent with stakeholders around the reasoning for and impacts of its decisions and document the management practices in place so that stakeholders can make their own informed judgment about its impact and the adequacy of measures taken. You may access the information required in their Disclosure Report on their profile here. B Lab will continue to monitor the situation, and if new material information arises related to the decision, a complaint process may be reopened.

For more context on our decision, a company must achieve a minimum verified score of 80 points in the B Impact Assessment in order to become a B Corp, which is designed to help measure and manage a company's positive impact across five key impact areas: governance, workers, community, customers, and the environment. The B Impact Assessment awards credit for specific, positive practices of companies to determine their eligibility for the certification, but does not stipulate or mandate specific individual positive practices. For example, while the B Impact Assessment acknowledges as best practices, among other things, supporting small scale and local suppliers, maintaining long term relationships with suppliers (average tenure), and purchases from organic producers, these practices are not required components of the certification if, as described above, the company is meeting the overall score of 80 points.

In addition, B Corp Certification also includes a review of potential negative practices that may warrant further action or ineligibility for the certification, and has a complaint process designed to allow stakeholders to raise concerns about existing B Corps who may be violating the spirit of the certification. B Lab investigates material, credible, and specific complaints, with the possible outcomes of any complaint including no further action, additional transparency required, remediation required, or ineligibility for the certification.

B Lab uses feedback from stakeholders like yourself not only to determine whether or not an individual B Corp is in violation of the certification requirements, but also to inform the development of the certification requirements over time. We are currently undertaking a comprehensive review of the B Corp certification performance requirements and have recently gone through an extensive stakeholder consultation process regarding the possibility of additional specific minimum requirements as a component of the certification. There will be ongoing opportunities to submit feedback throughout this review. Further details can be found here. Thanks again for your interest and engagement, and we encourage you to provide feedback to continue to improve our standards.


B Lab Standards Management Team