Kraft renews Lowville dairy co-op contract

Kraft Heinz, with its Lowville plant pictured above in 2015, rejected Jefferson County Bulk Milk Cooperative’s contract proposal to sell its milk next year. Watertown Daily Times

LOWVILLE — While Kraft Heinz decided to no longer buy milk from one local dairy cooperative in Watertown for its local plant, it agreed to purchase milk from another in Lowville.

Lowville Dairy Producers secured another one-year contract from Kraft to purchase milk from it, said Brien L. Tabolt, general manager of the group. He said he learned about the new contract on Dec. 20.

Kraft purchased 1 million pounds of milk per day from the co-op last year, and Mr. Tabolt said the processor, which makes cream and string cheese at its Lowville plant, will continue to purchase the same amount this year. He said he believes the Lowville co-op, which represents 156 farm members, most of whom reside in Lewis County, supplies about half of the milk for Kraft’s local plant.

Officials from Kraft did not return request for comment.

“I’m tickled with it. We seem to have pretty close ties with them,” Mr. Tabolt said. “We’re a bigger player, and that certainly helps.”

Jefferson County Bulk Milk Cooperative learned Dec. 2 that Kraft rejected its contract proposal, leaving members scrambling to find a buyer for most of its milk for next year.

The group, which represents almost 30 member farmers, established a contract with Upstate Niagara Cooperative to purchase 65,000 pounds of milk from it daily for its plant in North Lawrence, but the group had provided 200,000 pounds daily to Kraft last year. That leaves about 135,000 pounds of milk with no takers after its contract with Kraft expires on Wednesday.

A broker has been trying to find an additional buyer for the Watertown co-op, but finding one will be difficult because most processors have already secured their supply sources and curtail production from January to March.

“I just wish there was something we could do for them. They’re kind of our sister co-op,” Mr. Tabolt said. “We’ll try to help in any way that we can, but there’s not a lot we can do.”

Lowville Producers has sold milk to Kraft for more than 80 years. The processor, however, faced difficulties balancing its inventory in the late 90s, so Lowville Producers struck a deal with Dairy Farmers of America to have it market the local group’s milk on its behalf, Mr. Tabolt said. Dairy Farmers of America decided to end contracts to market smaller cooperatives’ milk last year, leaving the Watertown and Lowville co-ops to strike deals with processors themselves. Both secured deals with Kraft last year to purchase their milk this year.

“We’ve kind of grown with the company as they grew,” Mr. Tabolt said.

Johnson Newspapers 7.1

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