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Pastimes : The Case for Nuclear Energy -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (36)	1/19/2001 3:46:27 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 312

Even the dairy farmers are feeling the wrath of California's misguided energy policies: siliconinvestor.com FARM SCENE:Calif Power Crisis To Hurt State's Dairy Indus Dow Jones Newswires FRESNO, Calif. (AP)--California dairy farmers and milk processors predict economic hardships for the industry and higher prices for consumers if the state's power crisis continues much longer. As residential customers in Northern and Central California dealt with rotating blackouts Wednesday, agricultural leaders around the state were meeting to try to draw up emergency plans in the face of the power problems. "We're at the critical stage right now," said Jim Gomes, vice president of corporate operations for California Dairies, Inc. "We're getting close to the dumping stage, where we have to call our farmers and have them dump their milk on the farm," he said Wednesday, shortly after meeting with high-volume customers in California's San Joaquin Valley. The problem for California Dairies, which is the second-largest dairy cooperative in the nation, is that the power supply to its main customers - which include Kraft Foods Inc. (X.KRF) - has been interrupted by Southern California Edison for the past three days. Southern California Edison is a unit of Edison International (EIX). "Every hour that a big plant like Kraft is shut down, they turn away about 100,000 pounds of milk," said Gomes. California Dairies processes and sells about 38 million pounds of raw milk from 700 farms every day. Monday, Tuesday and Wednesday, the three largest plants in the San Joaquin Valley shut down for several hours. "If it continues like it is, we'll probably be dumping milk on Thursday," he said. On Wednesday, the Turlock Irrigation District warned California Dairies that power to its Turlock processing plant may be cut off at any time - with just 20 minutes of warning. The past few weeks of power chaos has spurred leaders of California's $4.3-billion dairy industry into meetings with state agricultural regulators. On Friday, the Western United Dairymen, a trade association representing about 1,100 California farmers, asked the California Department of Food and Agriculture to increase the price of milk for liquid, cheese, butter and powder to account for the industry's rising energy costs. A dairy farmer normally produces 100 pounds of milk using about 23 cents worth of electricity, said Michael Marsh, chief executive of the Western United Dairymen. Early estimates suggest that the cost might have increased to 26 cents last month. If farmers are allowed to pass that cost along, it will mean an increase of less than a penny a gallon at the supermarket, Marsh said. Because milk payments to dairies are heavily regulated, farmers can't increase prices without government approval. A decision from the CDFA is expected within the next few weeks. Consumers may begin to see higher prices sooner, however, if processors such as Kraft or California Dairies raise their wholesale prices to account for spiking natural gas and electricity costs. "At some point down the road, it's got to happen," Gomes said. But cheese is a national business - California farmers and creameries compete with farmers in Idaho and Wisconsin - so the price can't be raised too high without giving an edge to out-of-state competitors.