The Raw Milk Wars Heat Up in Ohio

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The new operation brought in about $300 a month in revenues, about 10% of farm income. The remainder came from sales of milk to conventional milk processors, along with vegetable sales.

Last February, the ODA inspector who visited for what she expected was her routine annual inspection, for no obvious reason issued a stop-sales order, and in April the agency revoked her registration to sell pet food. According to Jones, the ODA determined that farmers like Fagan were using pet food sales as a ruse to get around the prohibition on raw milk sales.

Linda Fagan says that until she was put out of the pet food business, "I never realized milk was such a big deal." She hadn't heard of controversies about raw milk. "I've grown up drinking raw milk and never considered it to be a threat," she says.

Losing the Farm

And probably the most serious case, from the dairy's perspective, involves Carol Schmitmeyer, who with her husband and five children runs a 300-acre farm in Versailles, Ohio. A year ago, she established a herd-sharing arrangement to make raw milk available to about 150 people in her area who were eager for the product. The lawyer who drew up the papers had previously worked for the ODA, she says, and thus she assumed the arrangement would pass muster with the agency.

It did, until this past September, when the ODA demanded in a hearing that her dairy license be revoked. The hearing examiner agreed, declaring that the herd-sharing agreements were "a thinly veiled attempt to evade the prohibitions against selling raw milk" in Ohio, and ordered her license be revoked.

Schmitmeyer is appealing the decision in court and retains her license in the interim, but she says a negative decision could be catastrophic. "If they take our license away, we lose the farm." While she could, like Stutzman, apply for a new license, there's no guarantee it would be granted. According to her lawyer, Cox, she "runs the risk that they could reject it in that she is a violator."

Going Underground

So intense is ODA's campaign against raw milk, the agency earlier this year even sent a written warning to Organic Pastures Dairy, the Fresno, Calif., dairy that tangled with California agriculture officials—against selling raw milk via mail order to Ohio residents. ODA's spokesperson readily acknowledges that it has no jurisdiction in California.

Mark McAfee, president of Organic Pastures, replied to the agency that the FDA doesn't prohibit interstate sales of his raw milk, since it's labeled as pet food, and then added this needle, "Please understand that there are literally thousands of people drinking raw milk in Ohio in the underground markets…this is only getting bigger and bigger."

As McAfee suggests, the ODA, along with other states, appears to be trying to hold back a tidal wave of demand. Food and agriculture officials are arguing that raw milk is dangerous, but too many consumers feel differently, seeing raw milk as a highly nutritious food capable of building their children's immune systems and relieving symptoms of ailments from asthma to autism.

New Regime

When consumers want something so badly, they will pay enough that farmers will take the risk of supplying them with it, and in that sense, the comparison made to heroin and crack holds true.

One glimmer of hope for Ohio's enterprising dairies is Tuesday's election, which saw a Democrat, Ted Strickland, voted in as governor (see BusinessWeek.com, 11/8/06, "Capitol Hill's New Reality"). According to Cox, this means that ODA's raw milk policy will almost certainly be replaced come early next year. It could also give impetus to stalled Ohio legislation that would allow farmer-to-consumer distribution of raw milk, such as via herd-sharing arrangements.

In the meantime, the cat-and-mouse game among farmers, agriculture inspectors, and consumers continues…all over milk.

David Gumpert provides updates on this issue at his blog http://www.thecompletepatient.com.

Gumpert is author of Burn Your Business Plan! What Investors Really Want from Entrepreneurs and How to Really Start Your Own Business. His Web site is www.davidgumpert.com.