To get a better handle on the crisis that dairy farmers are facing, we contacted Mark Kastel, co-founder of The Cornucopia Institute. The Cornucopia Institute is a farm policy watchdog organization that seeks to ensure that organic companies adhere to organic principles. In recent years Kastel and The Cornucopia Institute have exposed some of the biggest organic milk producers for their very un-organic factory farm operations. The first part of our email exchange is below, and we'll post the second part tomorrow. 

OrganicNation: By now, we’ve all read about the crisis in organic dairy farming. How did we get here? Who or what are the main causes?

Mark Kastel: Rich investors started the Horizon Organic brand in the early 1990s. When they were successful introducing their first product (yogurt), that was made from all family farm milk, they solicited venture capitalists to invest in order to ramp-up their production. They used part of that money to convert their first factory farm in Idaho (managing 8000 cows). They also depended on other giant industrial-scale dairies for their milk production.

The same investors later did IPO (initial public offering) on Wall Street and made millions. They later sold Horizon to Dean Foods, the largest milk bottle or in the United States controlling 50 different brands, with $11 billion in annual revenue.

Those investors, now far richer, took their proceeds and founded Aurora Organic Dairy. This outfit now has five giant factory farms each milking thousands of cows. Aurora bottles private-label organic milk for Wal-Mart, Target, Costco, Safeway and others. They are undercutting the price for legitimate family farmers all around the country.

Dean/Horizon and Aurora have gotten away with violating federal organic standards. The Bush administration looked the other way and even let Aurora off after Cornucopia filed legal complaints and the USDA confirmed 14 "willful" violations of the law. Dean Foods and Aurora could not have gained a controlling share of the market without the complicity of the USDA!

We're now engaged in discussions with the new Obama administration at the USDA pleading with them to immediately take action against the scofflaws. As the hours tick by it will be too late for many families who will lose their land and their livelihoods.

ON: Is there a correlation between plummeting milk prices and the Aurora Organic suit that was recently dismissed?

MK: Obviously, many farmers and consumers were disappointed that the federal court in St. Louis dismissed the consumer fraud lawsuits against Aurora and the major retailers that sell their product. The USDA had found, among the 14 violations, that Aurora had sold milk labeled as organic that did not meet the federal standards. These consumers were cheated. The judge decided that they did not have the right to bring this lawsuit. The attorneys involved believe this was an error and are intending to appeal. A victory in this matter could have potentially shut down Aurora.

ON: In a Grist article, Elanor Starmer recently suggested that USDA Secretary Vilsack should adjust the price of milk to reflect the price of feed, just as USDA did during the Great Depression. Do you think that's a reasonable stopgap solution?

MK: Something has to be done. The nation's conventional and organic dairy farmers are hurting, big-time. Many, if not all them, are losing money. Some bankers have cut off their loans. Many will lose their farms that have been handed down over the generations. Like in India, sadly, we will see some of these proud people take their lives because they will have no options for supporting their family. This is an emergency.

We have argued, for years, that there should be some supply management system implemented. Farmers should receive fair pricing but all these giant factory farms, conventional and organic, that have started up when times are good have crashed any hope for sustainable pricing.