The Land of Milk and Money

April 13, 2005

Critics say Horizon and other mass-production dairies don't deserve the 
organic label — and that the USDA needs to come up with a real definition.
By Rebecca Clarren

The happy cow on the label of Horizon organic milk flies across the carton like some grocery-store superhero. The ubiquitous red milk carton in your local supermarket is like a stop sign for consumers: go no further, your quest for healthy milk ends here. The back of the carton assures us that Horizon milk is produced on certified organic farms, where "clean-living" cows "make milk the natural way, with access to plenty of fresh air, clean water and exercise." Horizon cows are not hopped up on antibiotics, continues the cheery copy. "Happy, healthy cows produce better milk for you and your family." Just now, though, at one of Horizon's dairy farms in central Idaho, the cows don't look too happy. Perched amid a stark landscape of sagebrush and expansive brown fields, long silver barns that hold 4,000 cows are linked like barracks in some covert operation. I drive down a narrow, cracked road toward the dairy's main office and pass open-air sheds about 20 feet away, where cows laze in crowded pens atop the brown hardpan of the Idaho desert. Just outside the milking barn, more cows are jammed into an outdoor corral. Amid clumps of dirt and snow, they are lined up, their bodies touching.

In recent weeks, as revelations of Horizon's farming practices have come to light, a collection of consumer groups and organic dairy farmers have erupted in protest. Horizon and similar dairies are capitalizing on the boom in organic foods, they say, but diluting the true meaning of the term. Contrary to genuine organic practices, which entail raising cows on open pastures, where the animals feed on grass, experts say that a substantial percentage of cows at farms like Horizon's are confined to pens, fed a diet of proteins and grains, and produce milk that, while free of hormones, is not as healthy as it could be.

At a recent meeting of the United States Department of Agriculture's organic advisory board, 25 dairy farmers gave public testimony, and 8,000 farmers and consumers sent letters, claiming that by allowing "confinement dairies" such as Horizon and Aurora Organic Dairy, a 5,300-cow operation outside Denver (started by the founder of Horizon), to continue to market themselves as organic, the label's original promise of excellence is lost.

"People are paying more for organic products because they think the farmers are doing it right, that they're treating animals humanely and that the quality of the product is different," says Ronnie Cummins, national director of the Organic Consumers Association, a network of 600,000 organic consumers. "There has never been farms like Horizon or Aurora in the history of organics. Intensive confinement of animals is a no-no. This is Grade B organics."

Cummins and other critics stress that the USDA has been lax in enforcing current organic standards, which remain vague, and in creating strict new ones. To them, federal organic standards should mandate that cows be raised on pasture and fed grass. Given the USDA's failures, they attest, confinement dairies like Horizon continue to profit at the expense of the nation's small, independent dairies — ones that do follow organic principles and produce the healthiest milk possible for people, cows and the environment.

Despite its folksy image, Horizon is emblematic of 21st century agriculture. It's a brand of White Wave Foods, itself a division of $10 billion Dean Foods, the largest milk bottler in the country. Yet big business doesn't have to be a dirty word, says Steve Demos, president of White Wave Foods and overseer of the Horizon brand, who resigned from the company not long after our interview.

"There's a certain idealistic appreciation for a farm with 10 cows grazing on a hill at sunrise," he offers. "But there are 280 million people in the Unites States. If moms and consumers care about avoiding hormones and antibiotics, then it's our job to fill that need as much as possible. And if profits are rooted in noble causes and honorable intentions, then honesty pays. Long ago they said that small was beautiful; they forgot to tell you it's not profitable."

Here's a little primer on the cash cow that is organic milk. It sells for nearly double the price of regular milk (approximately $4 to $2 for a half-gallon). Although it currently constitutes less than 3 percent of the American milk market, sales have increased 23 percent every year between 1997 and 2003. At its current trajectory, organic milk is poised to become 6 percent of the market by 2010 — a $2.4 billion industry. Horizon, with annual sales of $218 million, is already the country's largest organic milk producer.

And, yes, building market share requires a clever sales pitch. "Nobody doubts the pure wholesome milk of the early American heritage dairy farms," Demos says. "We are marketing the very myth about early milk."

It's a myth that has certainly caught on. "Consumers always mention the happy cow," says Blanca Hernandez of the Hartman Group, a market research firm for natural foods. "Its brand reinforces their decision that they're buying something that's good for their family." Yet mainstream consumers, she adds, aren't aware of what qualifies as organic. "They don't know how exactly a product should be grown to be certified. It's not imperative to them. To them, the organic label simply means that their milk has been produced without the use of hormones or antibiotics. Those are the things they look for. It's what gives them peace of mind."

What most consumers don't know is that at Horizon's big dairies, such as the one in Idaho, the cows are raised in a manner that most experts don't consider organic. According to former Horizon Idaho dairy workers, who asked to remain anonymous for fear of jeopardizing their current jobs, Horizon cows graze for only four or five hours a day and during only three months in the summer. While Horizon claims the cows get plenty of fresh air, that's because the barns are open structures. Their cows can see the fields but mostly aren't walking around in them. "Most of the time, the cows are inside the barn," says one former employee, who worked on the Idaho farm for eight years.

Like the steady stream of Mexican immigrants who milk them every eight hours, Horizon cows work hard. In Idaho, they are fed a steady diet of alfalfa hay, oats, soybeans, and grains such as barley and corn (all organic!), according to a Horizon spokesperson. This starch diet pushes the bovines to produce extra milk. While dairy cows on many pasture-based farms are milked twice a day, Horizon's cows produce enough to be milked three times daily.

In general, says Dr. Hubert Karreman, a dairy cow veterinarian, "grain-heavy diets aren't good for cows." Karreman is an animal husbandry expert who also serves on the National Organic Standards Board, a federal advisory board. Cows have evolved to eat grass, which is why their four stomachs, filled with an array of anaerobic bacteria, function like fermentation vats at a brewery. When the majority of a cow's diet comes from grain and other readily fermentable carbohydrates, their rumen, the first of those four stomachs, becomes acidic and the cows can become sick and die prematurely.

Former employees say they have no evidence of this happening at Horizon. The company, according to its spokesperson, generally sells its cows at an average age of 6 years old to butchers, while in general many organic dairy cows can live to be 13.

"It's fundamental to organic that cows are eating grass that's rooted in the ground," says Karreman, based in Lancaster County, Pa. "I'm not in favor of large confinement farms. I like to see cows out on grass, eating in the sunshine, enjoying the landscape. Organic should mean that pasture is the true source of nutrition for the animals."

Linda Tikofsky, a veterinarian at Cornell University, agrees. "Cows are healthier when they're out on grass," she says. Tikofsky explains that while there's nothing in Horizon milk that would hurt anyone, for her, an organic label would mean a sustainable system where the health of the animal and the environment is more important than manipulating cows to maximize milk production. "I feed my kids organic milk but not Horizon," she says.

There remains a serious debate about just how good milk is for anyone. Ask any vegan. Regardless, many nutritionists say the most nutritious glass of milk comes from cows that eat fresh grass. Studies in the Journal of Dairy Science suggest that grass-fed cows produce milk that is higher in beta carotene, vitamin A and vitamin E, and has five times more cancer-fighting properties. This also contains an equal ratio of omega-6 and omega-3 fatty acids. Even amounts of these two fats result in lower risk of cancer, allergies, obesity and diabetes, according to a 2002 study in Biomed Pharmacotherapy.

Still, while the milk from Horizon and Aurora's confinement dairies may not be the cream of the crop, it's far from the milk produced by conventional factory dairies such as Borden, Alta Dena and Meadow Gold, all bottled by Dean, Horizon's parent company. These days, regular dairies can have up to 30,000 cows that are raised in huge contained barns with big lagoon ponds of manure out back. To keep all those cows healthy in such a confined space, they're pumped full of antibiotics. They're fed hormones to increase their milk production, and these conventional cows eat a tasty array of pesticide-laden feed. As calves, they're fed chicken manure because it's high in protein. Such milk is laced with a cocktail of pharmaceuticals and hormones such as rGBH, a controversial drug produced by Monsanto.

Horizon is on a populist mission to produce milk without hormones and make it accessible and affordable to everyone. In Idaho and at a 3,000-cow farm in California, from which Horizon buys milk, cows eat feed produced without pesticides; while producing milk, they are given no hormones or antibiotics. Horizon also buys milk from several hundred small dairies where cows do graze on pasture. A company spokesperson estimates that 30 percent of its milk comes from the company's farm in Idaho and a similar operation in Maryland

But because that figure doesn't include the additional milk it purchases from the California dairy, and a 5,300-cow dairy in Colorado, critics say that's a low figure. Based on its own market analysis, the Cornucopia Institute, an agricultural think tank, says it's more likely that nearly 50 percent of Horizon's milk comes from cows that are not raised on pasture.

Given that significant percentage, critics say the dairy is disregarding the intention of the organic laws. "Factory dairy farms are playing loose with the organic rules," says Mark Kastel, director of the Cornucopia Institute. "We cannot allow corporate profiteering to besmirch the organic marketplace. When consumers buy organic, they think they're supporting family farms with a higher environmental and animal husbandry ethic."

Over the past several months, the institute has filed three formal complaints with the USDA, alleging that the agency is being lax in its enforcement of the pasture regulation at Horizon's dairy in Idaho and at the other dairies in Colorado and California, where Horizon buys milk. While there is no timeline for when the USDA must respond, if the government fails to take this issue seriously, Kastel says his group may sue.

His position was bolstered this past March at the meeting of the National Organic Standards Board. A federal advisory panel recommended that the USDA clarify its regulations so that they more explicitly state that organic dairy cows be confined in bad weather to protect the safety of animals, often during birthing. It also advised the USDA to interpret the pasture rule to mean that all animals over six months of age graze grass for at least 120 days of the year.

This rule is controversial because big dairies like Horizon's Idaho operation currently don't meet that standard. It would also require big dairies to invest in more land and new milking procedures. It is now open to public comment and will be voted on in August. Yet whether the USDA will heed these recommendations is another matter entirely. Horizon has been able to get away with a creative interpretation of the pasture standard because the USDA hasn't been clear with the public or farmers about just what it means to be an organic cow.

The USDA doesn't actually go out to every farm and give it a stamp of organic approval. Rather, such grunt work is done by a hodgepodge of state agricultural agencies, nonprofit groups and for-profit companies; there are 97 different organic certifiers in total. These entities verify all aspects of a dairy's organic plan by inspecting records to ensure, for example, that the fields have been chemical free for at least three years and by visiting the farm to examine the conditions of the cattle, the milking parlor and the surrounding pasture.

While there are hefty federal penalties for illegally stamping a dairy organic, the system is fraught with potential conflict of interest. Kevin Elfering, a director of dairy food and meat inspection for the Minnesota Department of Agriculture, states that the pell-mell certification process lacks rigorous and transparent oversight. He says it's too easy for certifiers to bend the rules, allowing dairies to stay in business and keep the certifiers in the black as well. "There are always a small percentage of people looking to amass higher profits without following the rules," Elfering says. "You have any number of certifying organizations and they want business. The certifier would be biting the hand that feeds them if they enforce the regulations."

Indeed, John Cleary, certification director of the Northeast Organic Farming Association of Vermont, a 20-year-old nonprofit certification organization, says he would never stamp Horizon with an organic label. "It doesn't appear to me that they [Horizon] have access to pasture in the way we understand the rules," he says. "Organic is about balancing the amount of land with the amount of animals and the health of the animals. I don't see how these confinement operations can do that."

Cleary faults the USDA for not doing a better job of overseeing the certification process. "I've asked [Horizon and Aurora] how they're meeting these standards and they say, 'We're certified and we couldn't be doing this if we weren't meeting the standards.' The USDA needs someone with a backbone to stand up and say if you don't raise your cows on pasture, it just doesn't qualify as organic. There's an uneven playing field out there now."

According to Cleary and a host of consumer groups, the USDA has been about as vigilant as cops at a doughnut shop. Since the final organic rule was released in December 2000, the USDA hasn't implemented any of the organic standards board's more than 50 policy recommendations. It has yet to create a peer review panel to oversee the accreditation process, as is required by law, or to create a program manual for certifiers that specifies all of the rules and regulations.

"The staff at the USDA that is running the organic program continues to be cagey. The lack of transparency makes us wonder what they have to hide," says Urvashi Rangan, of the Consumers Union. Rangan wonders whether certifiers all follow the same standards for ensuring that milk is organic. "The quality of some milk may be less than others and the USDA needs to rectify the situation. I think the envelope is being pushed as wide as it actually can."

Even without overalls or a red barn (his are green), third-generation dairy farmer Jon Bansen evokes the days when milk really did arrive on our doorsteps at dawn. With his wife and four young blond children, Bansen raises 200 Jersey cows in the shadow of Oregon's coastal mountains. On a recent clear morning, as frost melts beneath a bright sky, cows with names such as Eileen and Trish crowd around Bansen, rubbing their noses on his jeans.

"I'm a grass farmer first — if I don't grow grass well, there's nothing for the cows," Bansen explains. "It's all about the health of the cow; it starts with healthy soil, and that relates to a healthy plant, and it just goes all the way up the food chain. Really, if people just use common sense, it's an absolute no-brainer. If an animal is healthier, what they produce will be healthier."

Bansen describes how he rotates his cows to graze different sections of his 310 acres of grass so that the land isn't overgrazed and trampled. During the winter months, when the Oregon rains make grazing dangerous for the cows, Bansen feeds the animals pickled grass that he cut last season. Today, Bansen sells his milk to Organic Valley, a cooperative owned and run by nearly 700 families with an emphasis on pasture. In 2004, it sold $208 million worth of milk, butter and yogurt. He and his wife make an income comparable to that of doctors or lawyers and he has three employees who make up to $35,000 annually.

Yet if the USDA continues to allow big companies like Horizon to play by different standards, Bansen says his livelihood will be at stake. If large dairies don't invest in the cost of land for pasture, they can sell their milk for less. While the large demand for a limited supply of organic milk has kept prices high for everyone, Bansen worries that when more large confinement dairies like Horizon enter the market, they will dictate cheaper prices.

"We can't compete with somebody milking 6,000 cows who's doing it in a manner that doesn't cost as much," he says, sitting in his living room that overlooks a broad green field. "Big dairies threaten the structure of rural America, which is contingent on living-wage jobs. Organic has provided for small family businesses."

Already, some small dairy farmers say the big dairies are squeezing them off the shelf. About 30 miles southeast of Bansen's farm, Franz Wenz, owner of Noris Dairy Inc., the only independent organic milk producer and bottler in the Northwest, says only large operations like Organic Valley and Horizon can afford to spend big bucks on flashy marketing and offer supermarkets exclusive deals at lower prices.

"The big guys can bury us," says Wenz, an Austrian native with bushy eyebrows and heavy jowls. "They can make exclusive deals and say, 'You just take our product and we'll give you a good deal.' The stores don't understand that they're hurting themselves when they depend on just one company that can then control the price."

To stay in business, Wenz and his family have carved out a niche by selling and personally delivering their glass-bottled milk, yogurt, cheese, ice cream and sour cream directly to more than 300 customers in the Portland and Eugene area. Wenz says he and his family intend to stick it out, despite hard financial times.

As the sun rises high above the morning's cloak of white fog, before us stretches the mythic American heritage dairy. Happy cows graze in a broad pasture of green grass. Only this time the picture is real.


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