by Dave Albin
Mises.org
When US dairy farmers worked together to reduce herd numbers — in order to limit supply and boost prices — this was apparently seen as a dangerous and deceptive move. Recently, dairy cooperatives (producers who work together and serve as middlemen between the farms and processors of dairy products) settled a class-action lawsuit for $52 million for working to reduce dairy cattle numbers, which would limit the supply of milk products. Why would farmers do this in the first place?
Dairy farms in general are still relatively small and have a meager return on investment, often requiring another source of income off the farm. This is largely due to one main factor: Americans are continuing to consume less and less dairy milk, even though public schools are required to buy it. Add to this the long list of changing consumer preferences seemingly ignored by the industry for many years.