Dairy Farmers Of America Begin Operation January 1
ORLANDO, Fla. Dairy
Farmers of America (DFA), a new
nationwide dairy marketing co
operative is ready to open for busi
ness January 1, according to co
operative leaders who held a news
conference here today. The new
cooperative, serving nearly
22,000 dairy farmer members in
42 states, is being formed by the
consolidation of Associated Milk
Producers Inc., Southern Region;
Mid-American Dairymen Inc.;
Milk Marketing Inc.; and Western
Dairymen Cooperative Inc.
Speaking on behalf of dairy
farmers, DFA chairman designate
Herman Brubaker noted that each
of the four cooperatives had com
pleted presentation of the con
solidation proposals to their mem
bers and delegates. All four co
operatives voted in favor of the
consolidation by significant mar
gins. Brubaker also reported DFA
held its first official event on
■
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Monday evening proceeding the
opening of the National Milk Pro
ducers Federation (NMPF) annual
meeting in Orlando.
Gary Hanman, president and
chief executive officer of Dairy
Farmers of America, joined Bru
baker in fielding questions from
journalists attending the meeting.
“The voting is complete and the
consolidation now awaits final re
view of the Department of Justice
antitrust division,” said Hanman.
“We're working on management
structure and will announce the
management team by next week.”
Hanman and Brubaker said a
high priority in coming weeks
would be to finalize the member
governance structure for the co
operative. DFA has divided the
United States into six “area coun
cils.” “Our goal in developing the
member governance structures is
to involve members at every level,
so the organization is small in the
« DECEMBER-FEBRUARY
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country, even though we will have
a large presence in the market
place,” said Brubaker.
Hanman said one of the first or
ders of business will be to imple
ment cost savings that result from
economies of scale and combining
operations. “We sec real oppor
tunities for savings in hauling and
some plant consolidation, espe
cially where plants are operating
only seasonally,” said Hanman.
“Our goal is to reduce costs by at
least $2O mil lien within the next
three years."
Hanman also said DFA will be
looking at new ways to help mem
bers reduce risk by using the fu
tures market. He said the new co
operative's broad geographic and
product base should help improve
price stability for members, but he
said members should not expect
the cooperative to single-handedly
raise prices. “Long-range, we
would hope to help members
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make mote money in the dairy
business through value-added pro
cessing, by becoming a major
player in the export market and
through branded dairy product
sales."
Brubaker said each of the con
solidating cooperatives has a posi
tion on the Federal market order
reform issue. “One of our first or
ders of business will be to look at
ITY
UNT
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RE 57394
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o v
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the whole issue of market order re
form and develop a DFA policy on
this matter,” said Brubaker. “Our
positions ate similar now, so I an
ticipate that, after some discussion
and debate, we will have a unified
position on where we want market
orders to be in the future.”
Dairy Farmers of America will
have its first corporate board
meeting in Kansas City on Dec. 29
and 30, 1997.
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