Robert Shore, General Manager

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Southern Dairy Conference
New Marketing Coalitions
February 6, 2001

• Robert Shore, General Manager
• Maryland Virginia Milk Producers Cooperative,
  Inc.

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• New Marketing Coalitions Between Dairy Farmers

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• Industry Consolidation

• New Marketing Coalitions Between Dairy Farmers

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• Industry Consolidation
• New Marketing Coalitions Between Dairy Farmers
• Federal Order Consolidation

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• Industry Consolidation
• New Marketing Coalitions Between Dairy Farmers
• Federal Order Consolidation

• More Marketing Coalitions Between Dairy Farmers

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Dairy Industry Consolidation
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Customer Estimates Sales (billions)
of U.S. Grocery
1. Kroger/Fred Meyer 43.1 9.7 2.
Albertsons 35.7 8.1 3. Wal-Mart 32.0 7.2
4. Safeway 25.0 5.6 5. Ahold 23.5 5.3 6
. Winn-Dixie 13.9 3.1 7. Publix 12.1 2.8
8. AP 10.5 2.4 9. Food
Lion 10.2 2.3 10. Meifer 8.6 1.9
Total 214.6 48.4
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(No Transcript)
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Top 10 Co-ops in 1990
Volume member milk (bil. Lbs.)
Dairy Cooperative

• Associated Milk Producers, Inc. 17.30
• Mid-America Dairymen, Inc. 8.18
• Dairymen, Inc. 4.94
• Farmers Union Milk Marketing Co-op 4.90
• Land OLakes, Inc. 4.30
• California Milk Producers Association 4.13
• Milk Marketing, Inc. 3.71
• Northwest Dairymens Association 3.66
• Dairymens Cooperative Creamery 3.30
• Atlantic Dairy Cooperative 3.25

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Top 10 Co-ops in 2000
Volume member milk (bil. Lbs.)
Dairy Cooperative

• Dairy Farmers of America 34.896
• California Dairies, Inc. 13.200
• Land OLakes, Inc. 11.656
• Northwest Dairy Association 5.700
• Dairylea Cooperative, Inc. 5.382
• Foremost Farms USA 5.359
• Associated Milk Producers, Inc. 5.100
• Family Dairies USA 5.059
• Manitowoc Milk Producers Cooperative
  3.660
• Maryland Virginia Milk Producers 3.141

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Producers vs. Milk
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• Industry Consolidation
• New Marketing Coalitions Between Dairy Farmers

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New Marketing Coalitions Between Dairy Farmers

• Advantage Dairy Group

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Southeast Milk, Inc. 230 2.8
billion Maryland Virginia 1,600 3.3
billion Land OLakes 2,600 3.6
billion SEMMA 260 840 million
Total 4,690 10.5 billion
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New Marketing Coalitions Between Dairy Farmers

• Advantage Dairy Group (ADG)
• Dairy Marketing Services (DMS)

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Dairy Marketing Services - DMS

• DFA/Dairylea Joint Venture
• One Northeast Milk Marketing Program
• 10 Billion Pounds Annually

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• Industry Consolidation
• New Marketing Coalitions Between Dairy Farmers
• Federal Order Consolidation

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(No Transcript)
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Federal Order Consolidation

• Fewer, Larger
• Geographically Closer
• Liberalized Pooling Rules
• New Economic Incentives to move milk
• (Class I Utilizations, Class III vs Class IV)

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• Industry Consolidation
• New Marketing Coalitions Between Dairy Farmers
• Federal Order Consolidation
• More Marketing Coalitions Between Dairy Farmers

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Regional Agencies Between Cooperatives

• Maximize Supply Efficiencies
• Maximize Net s to Farmers-
• Federal Order and Over Order

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Summary