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FRSAN-NE Farm Financial Counseling Discussion: Losing the Contract

The recent news that Danone, the parent company of Horizon Organics, is terminating the contracts of 79 dairy farmers across New England is the latest in a long series of situations where farmers face difficult decisions when the company that they have invested to sell to decides to cut them off. Once limited to chickens and hogs produced under production contracts, these corporate decisions to cut off regions of farmers have now been seen in organic milk, specialty meats, and a series of other products. When a farmer loses a market they have taken on significant debt to serve, there are a series of issues that determine the ability of the farmer to pivot to a new market, a new product, or even keep their home and land.

This discussion group for farm advisors will address specific production, financial and human issues that determine the options available to farmers facing a significant market disruption, including debt load, specificity of equipment, scale of markets and entrepreneurial experience. We will begin with a presentation to set the stage, and then conduct a discussion among experienced farm financial counselors regarding assisting farmers through the loss of contracts. Please note that this discussion will focus on tools and approaches that farm advisors, especially financial counsellors, can use to assist individual farmers through this or similar situations and will not address policy responses or other issues.

The discussion will be started with a 20-minute opening presentation by Scott Marlow of the Rural Advancement Foundation International – USA, drawing on experience serving tobacco, hog, chicken and produce farmers who have faced similar situations. The remaining time will be discussion among service providers, and will provide opportunities for further networking and collaboration.

This workshop is sponsored by the New England Farm and Ranch Stress Assistance Program.

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