Dairy Farmers of America (DFA), the US’s top milk producer, was hit with an antitrust lawsuit in North Carolina federal court Tuesday, May 19, challenging its acquisition of the country’s largest milk processor, the bankrupt Dean Foods, three weeks after the Justice Department approved the US$433 million deal.
“With capability to wield market power at two levels of the supply chain, DFA now has both the ability and the incentive to wipe out any remaining pockets of competition,” the suit claims.
The tie-up will lead “inevitably” to “the death of the independent, family-owned dairy farm, and higher prices for consumers,” the suit alleges.
Dean filed for bankruptcy in November and was followed into chapter 11 in January by another large fluid-milk processor, Borden Dairy, as falling milk consumption puts intensifying pressure on the highly regulated industry. Dean, the top US milk processor by sales, had struggled for years with slumping demand as consumers gravitated to other beverages, including milk alternatives made from soy and oats.
Full Content: Bloomberg
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