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OCA Boycott of Bogus Organic Milk Brands Putting Pressure on Nation's Largest Dairies & Retailers

Web note: Click here for MSNBC's online survey: Vote: Are big feedlots a threat to organic farming?

The cows on Pam and Jeff Riesgraf's farm chomped happily away on lush green grass on a warm, sunny afternoon. Their milk would soon find its way to grocery stores, where organic dairy products are a hot item.

The Riesgraf farm represents one vision for organic dairy - small- and medium-sized family farms where the cows have names and spend the growing season on pasture. But a different kind of organic dairy farm is emerging out west - corporate-owned feedlot operations with thousands of cows that are fed organic grain but, according to critics, get little chance to graze.

Fears that big operations will muscle out family farms have produced a backlash, including a boycott by the Organic Consumers Association against the country's biggest organic milk brand, Horizon Organic.

Organic farmers and consumer groups are hoping the U.S. Department of Agriculture will level the field. The agency is considering whether to mandate that milk bearing the "USDA Organic" seal come from cows that have significant access to pasture, a move smaller producers say would give them the protection they need.

Chris Hoffman drank Horizon milk until she learned about the dispute and switched brands.

The Sherburne, N.Y., woman said she'd thought she was buying milk from "family farms with happy cows." To her, feedlot milk does not follow the spirit of organic farming.

"I just think it's patently dishonest. And it just really ticked me off," she said.

Horizon, part of Fort Worth, Tex.-based Dean Foods Co., sells about half of the organic milk in this country, through retailers including Wal-Mart Stores Inc. Its president and CEO, Joe Scalzo, said Horizon is a strong supporter of family farms, helping hundreds make the transition to organic. Horizon is just trying to meet the "exponential" growth in a market where demand outstrips supply by some 20 percent, he said.

However, Mark Kastel, senior farm policy analyst with the research group Cornucopia Institute, countered, "There's been a near consensus in the organic community that these factory farms are repugnant to the consumer and put organic farms at a disadvantage."

Kastel said organic milk consumers are willing to pay more because they believe it's produced to higher ethical standards that benefit the environment, the animals and family farmers.

"They don't think they're supporting rich corporate investors who think organics is a great way to cash in," he said.

The Organic Trade Association says the U.S. organic dairy sector racked up $2.1 billion in sales last year, up 24 percent from 2004. The OTA says organics now make up 3.5 percent of all dairy products sold in the U.S.

While Scalzo said the boycott has had "very, very little" effect, he acknowledged Horizon has had to spend time explaining its position to stores.

While Broomfield, Colo.-based Horizon has taken the most heat, the critics also slam Aurora Organic Dairy, of Boulder, Colo., which provides private-label organic milk to chains including Costco, Safeway, Giant and Wild Oats.

Aurora says it milks about 4,100 and 3,500 cows at its farms near Platteville, Colo., and Dublin, Texas, and will open a 3,200-cow operation near Kearsey, Colo., this fall.

The company says its approach is unique in the organic dairy sector, allowing it to keep prices affordable while producing the highest quality milk. Aurora says its cows get a balanced diet that includes organic grain and hay, as well as grazing on organic pasture.

Aurora spokeswoman Amy Barr said organic standards shouldn't be based on an "image of Old MacDonald's Farm" held by people who may never have been on a farm. Pasture is important, but it's not the only measure of animal welfare, nor is an all-grass diet necessarily the best for a cow's health, she said.

Horizon milks about 4,000 cows at its farm near Paul, Idaho, and about 450 at its farm near Kennedyville, Md. But Scalzo said Horizon gets over 80 percent of its milk from 340 family farms, all but three of them with herds of 500 cows or fewer.

"Farms of all sizes are going to be needed - at least for the foreseeable future, the next two to five years - to meet demand," Scalzo said.

Executives with Austin, Texas-based Whole Foods Market Inc. recently toured Horizon's Idaho farm and were pleased with improvements made there, said Margaret Wittenberg, vice president of communications and quality standards.

"The cows looked in good health. They were certainly curious, which is always a good sign. They're being taken care of," Wittenberg said

Whole Foods was not impressed, however, by Aurora's Colorado farm.

"It remains unacceptable for us," she said, declining to elaborate.

The USDA is now drafting a proposed rule that will likely come out this fall, and there will be another comment period, spokeswoman Joan Shaffer said.

Horizon supports the key proposal, which would require that organic cows spend at least 120 days a year on pasture, Scalzo said.

Aurora opposes that standard as unscientific and told the USDA eastern Colorado gets only about 45 to 60 days of significant edible grass per year.

The nation's largest farmer-owned organic dairy co-op, the Organic Valley Family of Farms, based in LaFarge, Wis., says its 572 family-owned dairy farms nationwide already exceed the proposed standards.

Organics have been a lifeline to many family farmers because organic milk fetches a higher price than conventional milk, allowing dairies to stay small. The Riesgrafs, who milk about 55 cows near Jordan southwest of Minneapolis, credit Organic Valley with keeping them in business.

"We have a stable price, and we've slowly been increasing our price," Jeff Riesgraf said.

A few miles away, near New Prague, Dave and Florence Minar have carved out their own niche, producing and bottling organic milk at Cedar Summit Farm, which milks about 160 cows.

Dave Minar and the Riesgrafs said they're confident they can compete as long as the USDA requires meaningful access to pasture. They don't back the boycott, and sympathize with the smaller organic farmers who supply Horizon.

"We're trying to farm our land and our livestock in the way nature intended," Minar said.