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Saturday, May 22nd, 2010

Area dairy to close

Rockford facility filed bankruptcy last year

By Nancy Allen
ROCKFORD - Unable to find a buyer after filing for bankruptcy protection late last year, the 2,100-head Hopewell Dairy southwest of Rockford is closing.
Hopewell was placed into receivership by a bankruptcy judge last year, according to documents filed in the U.S. Bankruptcy Court in Toledo. Receivership allows a company to avoid liquidation by reorganizing with the help of a court-appointed trustee.
Wisconsin firm Roach & Associates was appointed receiver and took over operation and ownership of the dairy located on Tama Road in October.
"We went through a process where we tried to sell it with the cattle and machinery and were unable to do so," said John Roach, the firm's owner. "So at this point, it is illogical to continue operating the dairy."
Roach said the process of removing the cattle from the megadairy began about two weeks ago and should be complete by the end of next week. About 75 percent of the cattle are already gone, he said.
The dairy's former owner, Albertus DeBruyn, moved from the Netherlands to operate the dairy. He left Ohio before it was placed into receivership and was handed over to a general manager employed by Vreba-Hoff, Roach said.
Vreba-Hoff Dairy Development, a U.S. firm with Dutch ties, had served as a consultant and developer for the dairy. Vreba-Hoff spokeswoman Cecelia Conway said the cause of Hopewell Dairy's financial situation was due to record-low milk prices and high feed costs that plagued the entire dairy industry for the past year or more prior to the bankruptcy filing.
Roach said his firm is coordinating the closure with the Ohio Department of Agriculture, which holds an operating permit for the dairy, to make sure there is enough manure storage.
If the dairy has not been sold by Oct. 30, Roach said his firm will re-evaluate the amount of manure storage needed to get through the winter. If there is not enough, the manure will be applied on nearby cropland in the fall. The manure storage structure also collects rainwater runoff from the farm which could cause it to overflow if not monitored and emptied.
Roach said an auction will be held June 12 to sell machinery from Hopewell and three other dairies also placed into receivership with his firm. They are Rock Creek Dairy near Bluffton, Ind.; Olman Dairy near Hicksville and Chesterfield Dairy near Wauseon.
The court action came on the heels of a lawsuit against the dairy filed in late September by AgStar Financial Services, Minnesota, involving default on commercial loans the dairy had with AgStar.
According to the bankruptcy court, Hopewell Dairy owed almost $21.4 million to various creditors, including AgStar, at the time.
Construction of the dairy began in 2005 and milking started in April 2007. Prior to that, many neighbors objected to the large dairy. Public meetings and hearings were held on the matter before the Ohio Department of Agriculture ultimately granted the necessary permits.
When it was at full operation, the dairy milked cows three times a day and employed about 30 people.
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