WYOMING, Mich. (WOOD) — West Michigan dairy farmers say they’ve been told they should be able to keep milking after the county’s largest milk producer filed for Chapter 11 bankruptcy protections.
Dean Foods hopes the bankruptcy will help keep it afloat until a deal can be worked out to sell the company.
Dean has ties to West Michigan. Its Country Fresh brand is produced in Wyoming. Dean also owns another dairy in Marquette. Between the two, it employs 350 people in Michigan. Along with those local workers, Country Fresh milk is supplied by local farmers.
“About 90% of our milk this year has gone to Country Fresh,” Annie Link of Swiss Lane Farms in Alto told News 8 Tuesday.
Link said her initial concerns over the bankruptcy have been eased. The cooperative that Swiss Lane and other farms belong to says it will be business as usual thanks to $850 million Dean secured from lenders as part of the bankruptcy.
“What we’re hearing it’s going to be more like a restructuring. They are still going to be able to do operations as normal,” Link said. “I already contacted our co-op and they said, ‘Your milk is still going to get picked up. Your milk is probably still going to go to County Fresh.'”
That same co-op, Dairy Farmers of America, is in talks to buy Dean Foods.
Reports say Dallas-based Dean has struggled for years, due in part to Americans drinking less milk. The company’s sales were down 7% in the first half of the year, with profits down 14%.
But Link said not to write dairy off.
“While there might be some products that are on the decline, we still see dairy as being really strong. 94% of households are serving dairy across the county,” said Link, who added that milk is making a comeback. “What we’ve seen is the demand for dairy is really strong. People are just loving the cheese and yogurt and ice cream, of course.”
So what led to Dean’s financial problems?
“Well, every industry has a lot of changes,” Link said.
She said the trade war is one factor. If it can be resolved, she said to look for things to improve.
“China eating pizza is always going to be good thing for the dairy industry,” Link said.