dean foods – grouchyfarmer

Cake Plate, Air Filters, Schrodinger’s Microwave, Farmers Shafted Again

Egads, it’s been a while since I did one of these, isn’t it? This time of year as the weather gets colder it’s tempting to just hunker down in my warm radio room and play with radios and computers and stuff instead of doing something useful. But stuff has been getting done, things have been going on and, well, let’s start at the beginning.

I should point out that I **hate** the color rendition on iPhone cameras. The real life colors of that platter up there are much richer, much deeper, and considerably darker. I don’t know what’s going on with that camera, but colors look washed out, pale, harsh, even cartoonish sometimes, especially with indoor photos.

I don’t know if I mentioned the plate before, and I’m too lazy to go back through the archives to check, but I got MrsGF’s cake plate done finally. It’s hard to judge size in these photos so to give you an idea of size the top plate is about 11″ across and it stands about 5″ high. It’s made of ambrosia maple, finished with shellac and carnauba wax so it’s a food safe surface. I think it turned out reasonably well.

The base and spindle are made out of packing material. I ordered a bunch of wood from a company called Green Valley Wood Products and the wood didn’t quite fit into the box so they chucked in some rough cut pieces of wood as packing material that turned out to be some rather nice ambrosia maple once I cleaned it up. The stuff didn’t look like it was very good at first but I trimmed it up on the bandsaw and discovered there was enough there to make the base and spindle.

I should probably have mentioned Green Valley before. I’ve bought several hundred bucks worth of wood from these guys over the past few months and it has all been excellent quality and the prices are reasonable. Anyway, here’s a shameless plug – If you’re looking for wood, check out Green Valley Wood Products, Brazil IN. I don’t get free wood or get paid by them or anything like that, I just like the quality of their wood, shipping times are reasonable and the prices are fair.

The new air filtration system seems to be doing it’s job quite well. As you can see from the dirt on the filter up there it’s pulling stuff out of the air. It’s hard for me to tell exactly how well it’s working because I don’t have any way of testing particulate content in the air around here, but it seems there is a lot less dust through the whole house since I started using it.

Even with the new filter system I still use this thing. I figure running both of them can’t hurt.

Is it any better than something like this Rube Goldberg thing over there on the left? Heck, I don’t know. Taping a furnace filter to a box fan does help pull stuff out of the air, but how effective it really is… Well, judging from the amount of dust I saw in the rest of the basement when I was doing things like this, it doesn’t work all that well. The volume of air being moved through this thing isn’t anywhere near as great as what the Shopfox thing pulls through its system. At a rough guess I’d say the Shopfox moves 5 times as much air through its filters as the box fan does. That’s just a rough guess, of course, based on the air movement I feel. I don’t have any way to actually measure CFM.

Let’s see, what else? Ah, how could I forget about the Schrodinger’s microwave fiasco? I call it Schrodinger’s microwave because it seems to both exist and not exist, at the same time.

Handy hint: Don’t buy a black microwave. It may look cool in the display room or online, but in real life trying to keep it clean is a major pain in the neck.

So, let’s start at the beginning. Last year we had to buy a new microwave oven. We ended up getting a Maytag, the one in the photo over there on the right. And it’s a very nice microwave. A bit pricey, but it’s well made and works very well indeed. We really like the thing. The problem is that this model doesn’t seem to actually exist.

We needed to replace the filters in this thing. MrsGF went out on the internet and started scrounging around looking for replacement filters. And couldn’t find any. In fact, she couldn’t even find this oven.

You’re kidding, said I. You must have typed the model number in wrong or overlooked something. Ah, said she, if you’re so smart, you go try to find it. Okay, said I, I will.

She was right. None of the parts vendors on Amazon list this model. None of the parts vendors outside of Amazon list this model. I went directly to Maytag. Maytag itself didn’t have this model in its database. Apparently we bought a microwave that doesn’t actually exist???

I took a closer look at the tag with the manufacturing data on it, including the date it was made and…

Well, that was interesting. Apparently this oven was manufactured three months after we bought it. Okay… Well, I ruled out the possibility that somehow this thing slipped through some crack in the spacetime continuum from some alternate universe or that the guy who actually installed it was Dr. Who or that it was some kind of quantum oven that both existed and didn’t exist at the same time. So what was going on? Some kind of counterfeit perhaps? It does happen. There are companies out there that gleefully rip off name brand manufacturers all the time. But that didn’t make sense. This thing is extremely good quality. Everything about it is rock solid, made to perfect tolerances, made of high quality materials, the fit and finish is flawless, it works beautifully. If this thing is a counterfeit they’re making products of better quality than most of the name brand stuff out there. So that didn’t make any sense.

Anyway, eventually I did find a filter, but by searching on the filter dimensions instead of models or brands. The one I found was actually for a Whirlpool. Of course it is entirely possible that this is a Whirlpool, or, rather, made by some OEM in China that makes ovens for two or more different companies and the only difference between them is the brand name. That kind of thing happens all the time in most industries. The name you see on the product isn’t the company that actually made it. Heck, the Ford truck I had many years ago was actually made in Canada by Mazda.

Farmers Getting Screwed Again?

Yeah, it seems so. Here’s the deal – Farmers who sold their milk to the now bankrupt Dean Foods are getting letters from lawyers demanding the farmers repay the money they were paid for milk they shipped to Dean during the “preference period” of the bankruptcy. Supposedly these parasites can go back 90 days and demand the farmers repay the money Dean paid them. Will the farmers then get their milk back or something? Of course not. Is it ethical? Good lord no! Ethically speaking this is flat out extortion. Is this legal? Apparently it is. It’s called a Trustee Avoidance Claim. But in actual fact most, if not all of the farmers who dealt with Dean who are receiving demands like this qualify for an exemption and can avoid having to repay anything. But the trustees, of course, hope the farmers don’t know this and will just cough up the money. As Roger McEowen of Washburn University said, “These are extortion letters, there’s no other way to put it. They’re seeing what they can get.”

But if you get one of these letters, you’re going to have to get your own lawyer to respond properly, so you’re going to have to foot the bill for that. Still, hiring a lawyer is going to cost a lot less than having to potentially repay tens of thousands of dollars to these parasites.

And on that rant, let’s wrap this up.

Borden Dairy Files Bankruptcy

Borden Dairy Company filed for bankruptcy. Borden said it had debts of $500 million and assets of only $100 million. It employs over 3,000 people. This doesn’t mean the company will completely go out of business, and the statement said the company will continue operations as it works out a way to get its finances straightened out.

Interestingly, Borden was listed as one of Forbes 2019 “Most Reputable Companies” back in May, where it was listed as number 16. Obviously Forbes didn’t look at the company’s actual finances when making up that list.

When companies like Borden and Dean Foods goes under, the pundits and the companies themselves are quick to point the finger of blame at anything and everything. The articles I’ve read about the Borden’s bankruptcy and the earlier Dean Food bankruptcy blame the decline in the consumption of milk, the increasing popularity of plant based “milk”, changes in diet, dietary fads, major retailers like Walmart building their own milk processing facilities, etc. They blame it on everything except the real reason, the company itself. Or, rather the management of the company. The company itself was unable to adapt to changing market conditions, and that is what drove them into financial failure.

Yes, consumption of liquid (drinking) milk has been declining. But this is a trend that has been going on for decades. They can’t claim that they were blindsided by this. Walmart made no secret of the fact that it wanted to build its own milk processing facilities. That was known for years before they actually did it. The growing interest in vegetarian and vegan diets that reduce or even eliminate the consumption of dairy products isn’t new either. This is a trend that has also been going on for years now. The same is true for the increased interest in grain and nut based “milk” products.

That Bordens and Dean couldn’t make it is due entirely to the failure of their own management teams being unable to adapt to changing markets.

I’m sitting here in eastern Wisconsin, just 20 miles or so south of Green Bay, and I’m surrounded by dairy companies that are doing pretty darn good. Over the last few years I’ve seen at least a half dozen major expansions by large processing companies, mostly cheese makers, including some multinational corporations. And they’re all doing pretty well. Why? Because they’ve been able to adapt to a changing market.

Dean and Borden failed because they didn’t adapt to an ever changing marketplace.

Dean Foods Files for Bankruptcy

Dean Foods said it has nearly $850 million secured in debtor-in-possession financing to continue regular operations until the deal is finished.

Source: Dean Foods Files for Bankruptcy, Hopes To Sell to DFA | Farm Journal’s MILK Business

Dean Foods, one of the largest milk processors in the country, filed for bankruptcy on Tuesday and is in purchasing talks with Dairy Farmers of America, a huge co-op.

This is one of those situations that surprised me but didn’t surprise me, if that makes any sense. I knew Dean has been in financial trouble for some time, and there were rumors going back months already that it was looking around to try to sell itself. But I didn’t think the company’s financial situation was quite this bad.

Dean has been struggling for a long time. It lost a major contract with Walmart not too long ago. Dean had been supplying the retailer with milk under the Walmart house brand, and lost a major part of that market when Walmart opened its own milk processing facility. Dean’s major problem is that it has always been a supplier of liquid (drinking) milk and that market has been shrinking for decades. Dean has never been able to adapt to that. It’s tried various things, tried rebranding, different products, even tried investing in plant based alternatives to milk, but nothing ever really worked very well for the company. It hasn’t made a profit in over two years, and that just couldn’t go on any longer.

I find myself wondering how much longer milk as a beverage is going to hang around as a major factor in our diet. For at least twenty or thirty years now the consumption of beverage milk has been declining, and all the hype and propaganda being pumped out by the various milk marketing boards and the dairy industry hasn’t managed to reverse that trend.

Farm Catch Up

Spring has finally arrived! Well, sort of. At least according to the calendar if not the weather. It’s been too wet and too cold to be able to do much of anything outside except cleaning up the flower beds and yard. So let’s take a look at what’s going on in the ag industry since the last time I did one of these.

Dean Foods For Sale

If you’ve ever had a hankering to own one of the largest dairy processors in the world, now is your chance. Dean Foods, once the largest dairy processor in the U.S., is apparently trying to sell itself off. The company has been having a difficult time of it. It’s been forced to close processing facilities, it lost a major contract with Walmart, and its efforts to rebrand some of its products and buy into other businesses haven’t been successful, or at least not successful enough to prop up the company’s dwindling sales. It’s been missing its sales targets for something like two years in a row now, and there are no signs things are going to get any better. Supposedly Canadian based Saputo, the 8th largest dairy company in the world, is interested in acquiring Dean. If successful this would be just the latest in a wave of mega-mergers among agriculture related businesses in the last few years.

If you find these mega-mergers to be troubling, well, you should. Despite claims to the contrary, these mergers are resulting in the creation of huge, multinational companies that dominate their markets and often they have virtual monopolies on the product lines they sell.

Bayer Stockholders Angry

Speaking of mega-mergers, Bayer’s management is facing repercussions from stockholders over it’s acquisition of Monsanto. It was expected that a lot of large stockholders were going to disapprove of the board of directors’ and management’s acquisition of Monsanto at the annual general meeting of the company. While this doesn’t change what management has done, it does indicate that a lot of stockholders are very angry over the decision to buy Monsanto, and the subsequent legal problems over the lawsuits about the adverse health effects from RoundUp, and most importantly, Bayer’s plummeting stock value.

Frankly, buying Monsanto was a really bad idea from the beginning, and if the executives at Bayer didn’t realize it, the company’s lawyers sure as hell should have. Even back when the negotiations for the purchase started Monsanto was already facing thousands of lawsuits over the alleged cancer risks of glyphosate. Now there are about 13,000 lawsuits in the pipeline concerning the herbicide. No, that was not a typo. Thirteen thousand.

And that isn’t the end of Monsanto’s legal problems. There is the whole dicamba fiasco to be concerned about as well. The lawsuits over the damage the company’s dicamba based herbicide has done since it was released a couple of years ago, along with lawsuits over Monsanto’s marketing tactics for it’s dicamba resistant soybeans, are starting to pop up now and are only going to get worse. Basically Monsanto is a legal nightmare and it is dragging down Bayer with it.

Beef Industry Lawsuits

While I’m on the subject of legal problems, the beef industry has been hit with two separate but related lawsuits alleging the four biggest beef packing companies, Tyson, JBS, Cargill and United Beef Packing (together they control 80% of the US beef market) conspired together to manipulate the price they paid to cattle growers and the prices charged to consumers. Basically it’s another claim of monopolies using their lock on the market to manipulate prices. Just those four companies control about 80% of the beef market in the US. Anyway, I won’t go into depth on this one. I’ll leave it to you to follow the link and sort out the details if you’re interested.

Walmart Gets Into Beef

I mentioned Walmart briefly when I talked about Dean Foods. Dean lost a huge contract to make Walmart’s house brand liquid milk not long ago when the retailer decided to experiment with eliminating the middleman and become its own processor. It built a large milk processing facility, cut deals with dairy farms to supply milk, and cut Dean Foods out completely in one district.

Walmart is now trying to do the same thing with beef. It is developing its own end to end supply chain to supply beef to some 500 Walmart stores. This won’t take care of all of Walmart’s meat. Most of it will still be supplied by Tyson and Cargill. But it does indicate a troubling trend where these big companies are trying to develop a complete monopoly over not only sales, but supply as well. Costco is doing something similar with chicken, developing its own supply chain that will supply about 40% of its needs.

Trade Wars Continue: Updated 5/6/19

I had this section all wrapped up and ready to go when the you-know-what hit the fan and… Okay, here’s what’s going on.

I really want to talk about the China situation, but let’s deal with something closer to home first, the new NAFTA treaty, USMCA, the US-Mexic0-Canada-Agreement. The USMCA negotiations finished some time ago, a treaty was agreed to, and all is well and good now, right? (Side note: Am I the only one who thinks USMCA is the title of a Village People song?)

Well, no. Yes, the treaty was negotiated, but everything is most definitely not good because not only are we still operating under the old NAFTA treaty, the administration has still left the punitive tariffs in place that have been causing disruptions of the economies of all three countries.

So what the hell is going on? We have the new treaty, so why are we still operating under the old NAFTA and why are the tariffs in place yet? Because before a treaty can go into effect it has to be ratified by the US Senate, and the US Senate has been doing what it does best, acting like a bunch of petulant, spoiled brats who are more interested in back stabbing each other and playing at politics and dabbling in personal attacks than they are in actually doing their bloody jobs. Supposedly one of the reasons why the tariffs are still in place is because the administration is trying to use that to goad the Senate into doing something. And since that hasn’t worked, the administration has threatened to cancel the existing NAFTA treaty, which would cause utter chaos, if the Senate doesn’t get off its ass and actually do its job for a change.

Now let’s move on to China. Now if you haven’t really been following what’s been going on there, you can be excused for thinking that all is sweetness and goodness and we’re all well on the way to being best buddies and all of this trade war nonsense will be over soon and, well, no. Sorry, but no.

As you’ve probably found out in the last couple of days, despite all of the positive PR fluff that’s been released by both sides over the last few months, things have most definitely not been going well with the negotiations. While both sides have been putting out positive sounding press releases, there have been issues, as they say. Behind the scenes things have been more than a bit testy.

Yes, China did a soybean purchase, but that was more PR than anything else. While the amount they purchased sounds quite large to the average person, in actual fact it was little more than a token purchase to indicate good faith on their part.

Things did sound positive for a while, though. Both sides were stating that things were going well and that they were on the verge of coming to an agreement. But then something happened. I’m not sure what, exactly, but whatever it was put a definite chill on the whole thing. There are a lot of rumors flying around. One is that the Chinese are very much aware of the legal and ethics issues the administration is involved with here in the US and as a result they just don’t trust anything the White House says.

Anyway, we suddenly had the administration muttering vague threats that it was considering pulling out of the negotiations entirely. Then the administration started threatening to ramp up the trade war to new heights, doubling the cost of the tariffs and including even more Chinese products in the tariff war. Then the Chinese started threatening to pull out of the negotiations… Oh, brother…

As I write this (May 7, 2019) things look tense, and the effects from this little tiff are rippling through the economy. The stock market is down. Commodities prices have fallen. Corn is down to 3.55, soybeans are down to 8.20… Sigh…

Even more disturbing is the fact that statements being made by the administration indicate that the administration doesn’t really know how tariffs work in the first place. One statement implied that the administration believes that China is paying the tariffs and that they are actually good for our economy. If the administration really believes that, it shows a fundamental ignorance about what tariffs are. Let me explain.

A tariff is intended to discourage the importing of a particular product into the US by increasing it’s cost to the importer. Let me emphasize that by repeating it: “increasing it’s cost to the importer.” Not the country of origin, but to the person or company that is importing the product. So for the most part, China doesn’t pay anything extra on products it exports to the US (except indirectly through lost sales). The people who pay the tariff are the US companies that are importing the products. And that cost is passed along directly or indirectly to us, the consumers.

Let me emphasize that: China doesn’t pay the tariffs, we do.

This is one of the reasons why tariffs are generally a bad idea except under extreme circumstances. It causes as much economic pain or more to the country importing the products as it does to the country exporting them.

It also makes the stock and commodities markets very, very nervous, especially in this situation because they don’t know what the hell this administration is going to do next. The markets like stability. They like predictability. And this administration is providing neither of those things at the moment.

Well, I’ve been babbling along for far too long already here, so let’s wrap this up.

Hopefully in the very near future I’ll have some new radio equipment to talk about. I’m seriously considering going QRP and I’ve been looking at mag loop antennas and the Yaesu FT-818ND QRP transceiver. We’ll see how that goes.