Some Dutch dairy dreams dry up

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America is not quite the land of dairy opportunity some Dutch farmers thought it was. Recent low milk prices and high production costs have taken their toll.

But some claim there is more at work than market forces. The Wall Street Journal reports that several Dutch immigrants, as well as lenders and suppliers, have filed lawsuits against Willy van Bakel, owner of Vreba-Hoff Dairy Development, alleging that he owes them money and that he misused their funds.

van Bakel strongly denies these allegations.

The Wauseon, Ohio-based company has helped about 70 Dutch dairy farmers get a start in the United States since it opened in 1998.

According to The Wall Street Journal, in most cases, Vreba-Hoff used farmers' own money — usually several million dollars from the sale of their farms in the Netherlands — to secure land and permits and start construction. For farmers who lacked capital to complete a dairy on their own, van Bakel reportedly lined up financing from banks or private investors. Generally, the company made money by charging fees for the various services and taking a cut of the final cost of new dairies, which could run more than $10 million, it was reported.

Most of the dairy farms he helped are still in business. But others have yet to get off the ground or have suffered serious losses, and therein lies the rub.

van Bakel says he on the verge of securing new financing and will pay what he owes.

Full story.

Source: The Wall Street Journal


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