Rabo gives Vreba-Hoff dairies more time to refinance

Waste treatment a problem

GRAND RAPIDS, Michigan - Over thirty Dutch dairy men, who mostly invested the proceeds of the sales of their farms in the Netherlands to make a fresh start in the United States with immigration consultant and turn-key dairy developer Vreba-Hoff, have returned home embittered, empty handed and destitute, their American dream gone terribly wrong. Vreba-Hoff, the flagship for a group of companies owned and or controlled by two Dutch farming entrepreneurs with operations in the Netherlands and the U.S.A., is itself in deep financial and legal trouble.

In recent days, agricultural lender Rabo suspended its move to place three Vreba-Hoff owned dairies in Michigan into bankruptcy pending the refinancing of a $55 million mortgage which had been defaulted. The wrangling follows various actions involving other dairies, which have been either repossessed or sold, mostly in the states of Indiana (12 mega farms), Wisconsin (9) and Michigan (4). The exact amount of funds invested by migrating Dutch farmers or borrowed from U.S. lenders is not known although it is generally assumed to be well over $100 million.

The Vreba-Hoff development proposals, which pushed the legal envelope in numerous counties where the required permits were requested, frequently evoked strenuous opposition from neighbours concerned over the extent of development plans. As a rule, manure disposal, foul odor and huge machinery and heavy trucks using rural roads were among the points raised as objections.

Blame

It did not help Vreba-Hoff that dairies set up by it frequently had serious compliance issues such as in the Adrian, Michigan area, where the court ordered the company to reduce the size of the herds, originally over 6,700 animals as per 2007 permits, but now down to half that number. (In its defense, a Vreba-Hoff expert witness told the court recently that it was impossible for the dairies to meet the manure treatment rules, and that these were designed to shut the operation down. The $7.7 million manure treatment systems at the two dairies cannot meet the strict standards for water used in irrigating field crops, the dairy company’s attorney stated in a recent brief.)

Vreba-Hoff has blamed its troubles on the current economy of low milk prices that are affecting farms across the country, stating that it had to trim operating costs just like all other farms had had to trim these. It also has cut the work force while refinancing and reorganizing is taking place. The firm's attorney attributed financial strains to the state’s litigation and fines.

Common to the complaints of migrating farm families is significant delays in the delivery of turn-key operations and missed deadlines, improper paperwork and high property and development costs.

Among Vreba-Hoff clients are a few Belgians and Germans but the majority is from the Netherlands. The Vreba-Hoff saga is regularly covered by the Dutch agricultural magazine De Boerderij, daily newspaper Agrarisch Dagblad and Financieel Dagblad, among others.