A decision by Darigold to deduct four dollars per hundred pounds of milk from checks to member dairies has Skagit County dairies scrambling to adapt.
“It doesn’t matter if you’re small, medium, or large,” said Jason Vander Kooy of Harmony Dairy. “It’s hitting everybody pretty hard.”
Darigold is the brand name of the Northwest Dairy Association (NDA), a cooperative with 500 member dairies in Washington, Oregon, Idaho, and Montana.
The checks that Harmony Dairy and other non-organic dairies will receive from the NDA this year, and probably through the first quarter of 2026, will be about 20% smaller than usual.
About $1.50 of the deduction will cover operations, and $2.50 will go towards cost overruns on a new processing plant under construction in Pasco, Washington. Originally estimated at $600 million, costs are now “sitting a hair over $900 million,” Vander Kooy said. Construction is also behind schedule.
But the plant must be finished, and farmers must pay.
Impacts vary near La Conner. The 400-cow Edensfall dairy on Calhoun Road will see its income drop. The Mesman dairy at Chilberg and Dodge Valley Roads won’t, because it sells all its organic milk directly to Samish Bay Cheese. According to Vander Kooy, there are no longer cows at the Fohn Family dairy at the foot of Pleasant Ridge.
With four locations in greater La Conner and west Mount Vernon — all purchased from long-time dairy families that retired or moved out of the area — Harmony Dairy will be the hardest hit.
How does a dairy tighten its belt?
“You go into survival mode,” Vander Kooy said. “You put off maintenance on the farm and don’t start new upgrades. You make do with what you have and try to stretch it out.”
“You have to feed, milk and take care of cows and pay employees and taxes, but it’s the extras that won’t be done,” Vander Kooy said.
Fortunately, the Vander Kooys have plenty of feed on hand, and the strong beef market means their calves are in great demand. “The U.S. beef herd is so short of animals that dairy is making up about 10% of its need to keep the herd up,” Vander Kooy said. “A cow can only have a baby once a year at best, so it takes quite a bit to replenish numbers.”
Alan Mesman, a producer for Darigold and Organic Valley until switching to direct sales to customers, says that there are few alternatives to Darigold.
When Darigold, in March, terminated its contracts with organic dairies like Dykstra Farms of Burlington, “They told us ahead of time that they were going to stop the organic program, and offered to find a new home for us or pay us the conventional milk price,” said Andrew Dykstra, whose family has been with Darigold for three generations.
“You’ve got to give Darigold credit,” he said. “Nobody was going to be hung out to dry, but I’m glad I don’t have the deduction.”
The Dykstras signed up with Organic West, which sells organic milk and milk products from family farms to well-known dairy brands. Selling to Safeway and its Lucerne brand is also an option.
For the Vander Kooy family, the cost of breaking the Darigold contract would far outweigh the four-dollar deduction. They will stick with Darigold.
Darigold’s oldest plants are in Lynden, Chehalis, Seattle and Issaquah. “Thirty or forty years ago, that’s where all the milk was,” said Vander Kooy. “Now the majority of dairy farming takes place on the other side of the mountains, where there is more feed, more land, more space, and less people.”
When the Pasco plant comes online, Darigold will have four plants in eastern Washington and Idaho, the new center of milk production.
During the Northwest Dairy Association’s hundred year-plus history, the dozen or so dairies remaining in Skagit County have weathered good times and bad, but this time is different.
“When the whole country is in a downturn, you know things will turn around eventually. But just our region will go through this downturn,” Vander Kooy said.
The issue is sure to be discussed at Darigold’s annual member meeting in June.
Meanwhile, Mesman believes this decision puts Darigold producers at risk.
“They are taking huge chunks from the milk check out just to keep the ship afloat,” Mesman said.
Anne Basye is a freelance writer based in greater La Conner. Jason Vander Kooy rents land from Anne Basye’s family.
