Over the past five years, an international cabal of dairy industry giants, Big Dairy, that controls the processing and sales of raw milk and milk products like pasteurized milk, cheese, yogurt, butter, creamers, and ice cream, sold at retail and in restaurants, has pressured small dairy producers, farmers who actually feed and milk the cows, to restrict their operations to meet the climate goals set by Big Dairy elites.
Big Dairy’s efforts are unjustified by science, harm small dairy producers, and have raised costs to consumers. These oligopolistic practices border on enforced speech and actions on climate and energy matters and anti-trust violations. Thankfully, two groups, Heartland Impact and Consumers Defense, are leading the fight.
Heartland Impact and Consumers Defense have called on the U.S. Department of Agriculture (USDA) to withdraw all support for the Pathways to Dairy Net Zero (P2DNZ), a United Nations developed initiative to reduce methane and other greenhouse gases from the dairy industry supply chain. Launched during Climate Week in September of 2021, P2DNZ consists of the largest dairy companies and cooperatives, controlling a huge percentage of the milk, cheese, butter, and other dairy product markets.
Working through the UN and in conjunction with multi-national and domestic companies that control large parts of dairy processing, wholesale marketing, and distribution networks to retailers in the United States, P2DNZ has pushed policies calling for dairy producers to reduce their greenhouse gas emissions and fossil fuel and fertilizer use, through what they call “voluntary measures.” They are hardly voluntary. Rather, they resemble extortion.
Just a few companies control the vast majority of the post-production milk market. Individual dairy farmers have received notices or letters from companies that purchase, process, store, and sell their finished products, requesting they report on their energy use, emissions of methane and carbon dioxide, and what efforts they are taking to reduce fossil fuel use and emissions to fight climate change.
These notices make clear that since the wholesaling and processing companies are committed to reducing emissions, they expect dairy producers to cooperate. Failure to follow Big Dairy’s guidance is likely to end their business relationship. Thus, they would have no practical way to get their milk to market because retailers have contracts with the big processing companies and cooperatives.
As detailed in a recent report from Heartland Impact and Consumers Defense, “The War on Dairy: Foreign Influence Subverting America’s Dairy Sector,” (War on Dairy) under President Joe Biden, the USDA embraced Dairy Net Zero as part of its whole economy makeover to fight climate change. At the UN Climate Week in September 2021, where P2DNZ was launched, Biden’s Agriculture Secretary Tom Vilsack endorsed it saying it would “position U.S. farmers, ranchers and forest landowners as leaders in addressing climate change.”
Biden doubled down, “U.S. farmers are on the frontlines of climate change… but they’re also part of the solution.”
Among the problems with the international and domestic efforts to force dairy producers to adopt energy restrictions in pursuit of net zero is the fact that climate science is hardly settled. What is clear, however, is that current data provide no support for the claim that fossil fuel use, either on or off the farm, is producing a climate crisis.
Highly efficient U.S. farms represent a minuscule share of global emissions, an amount so small that restrictions on dairy operations and fossil fuel use will have no impact on climate. On the other hand, they will have a big impact on dairy producers.
Net zero restrictions increase the costs of operating dairy farms, and rising costs have already forced more than 1,000 dairy producers out of business in just the past year.
“Net zero compliance introduces fixed costs into dairy production through monitoring systems, reporting requirements, third-party verification, consultant fees, and capital investments. Fixed costs are inherently regressive,” the War on Dairy report explains. “Large operations can spread them across volume; small- and mid-sized farmers and producers cannot.
“As margins tighten, smaller producers exit the field and assets consolidate, shifting market power upward,” the report continues. “Furthermore, in agriculture, a fragile supply chain opens the nation to food shortage vulnerabilities as an issue of national defense and national security, particularly during wartime. In any circumstance, consumers ultimately foot the bill.”
In America, everyone, including dairy producers, has the right to believe or not believe in climate change. They also have the right to support or not support supposed climate solutions. Big Dairy shouldn’t be able to extort climate concessions from producers. It raises anti-trust concerns.
Heartland Impact and Consumers Defense have sent a letter to USDA Secretary Brooke Rollins requesting that the agency disavow its support for P2DNZ, or at the very least to “disclose the current nature and scope of USDA’s affiliation with P2DNZ, including any funding, staff participation, grants, contracts, data sharing, technical assistance, or other support.”
There are some indications P2DNZ will have a short shelf life in the United States.
Rollins has previously indicated support for ending the agency’s association with P2DNZ. Shortly after Heartland Impact posted a video publicizing the dangers of P2DNZ to dairy operators, Rollins posted on X that P2DNZ would “burden small farms with costly compliance,” and continued by criticizing “radical ESG mandates disguised as sustainability,” declaring “ESG mandates have no place in American agriculture.”
In addition, a USDA spokesperson told a reporter with The Center Square writing a story about the War on Dairy report that “President Trump will not stand idly by while large, consolidated milk processors and the protectionist anti-competition bodies like the EU attempt to force our hard-working producers to hand over sensitive personal farm data as a condition for selling their milk.
“Proponents of these burdens should be on notice: your ESG standards will no longer be applied to American farmers,” the spokesman told The Center Square.
Ending all association with P2DNZ and making it clear to Big Dairy that they are under investigation for their nefarious climate efforts would be consistent with President Trump’s actions ending participation in damaging international climate efforts. Terminating P2DNZ in the United States puts Americans, from small farmers to consumers, first.
H. Sterling Burnett, Ph.D., (hsburnett@heartland.org) is the Director of the Arthur B. Robinson Center on Climate and Environmental Policy at The Heartland Institute, a non-partisan, non-profit research organization based in Illinois.