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New York attorney general 'troubled' by inadequate voice of small farms in dairy industry

(Monday, April 12, 2004 -- CropChoice news) ó More than 170 people attended the highly successful "Concentration and Market Power in the Dairy Industry" meeting on April 1 in Syracuse, New York. Many dairy farmers from around the nation came to hear New York Attorney General Eliot Spitzer, the key speaker, who voiced his concern for farmers struggling to compete in their industry.

"I appreciated the opportunity to address the National Family Farm Coalitionís Conference and was especially interested in the dialogue regarding concerns expressed by many farmers that competition is eroding in the dairy industry," said Spitzer. "The notion that small farms have an inadequate voice in the industry is especially troubling."

Spitzerís concern regarding the concentration issue in the dairy industry is valid because it provides various entities the ability to control prices on the cheese market and the dairy farm. This is not a new concept according to Thomas Dubbs, with Goodkind Labaton Rudoff & Sucharow LLP in New York, N.Y.

Dubbs led the lawsuit against Kraft Foods North America, Inc. for price fixing on the National Cheese Exchange (NCE), which the University of Wisconsinís "Cheese Pricing: A Study of the National Cheese Exchange" sparked in 1996. "Many of the concentration issues that govern trading on the National Cheese Exchange (NCE) may still be occurring on the Chicago Mercantile Exchange (CME), and we believe that should be looked at," said Dubbs.

"The main traders on the NCE are the same players on the CME today and they have dictated the low farm milk price for years," said John Bunting, a New York dairy farmer from Delaware County. "There is a near perfect correlation between farm-gate milk prices and block cheese prices on the CME."

"It was clear to me that whether it be on the Wall Street trading floors or in the barns and farms of Upstate New York, fundamental fairness must be maintained in order for markets to operate efficiently," said Spitzer.

For more information, contact: John Bunting (607) 746-3892
Katherine Ozer (202) 543-5675