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Mega-dairies - cost plus contracts?
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ImTheBoss
Posted 10/17/2018 07:35 (#7051331)
Subject: Mega-dairies - cost plus contracts?


SD/ND/FL
I was talking with a friend the other day about the large dairies being built in W MN. In the face of a ton of talk of terrible dairy margins, this large expansion is a bit surprising and it doesn't show any signs of stopping.

He told me that they are able to procure cost-plus contracts with processors? Obviously, these large dairies have efficiency down to a science but the magic bullet in my opinion, if true, is the cost plus contract.

Can anyone elaborate ?

In addition, can smaller dairies piggyback on a co-op contract like this? Wasn't this type of deal the whole point of a co-op (getting the best terms possible)?
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