Organic Valley Supply Management Program Pays Off!

One Year After Unanimous Farmer Vote for Supply Reduction, Production Back to 100% for Farmer-Owned Cooperative

La Farge, Wis.
June 24, 2010
Contact P.R. Elizabeth Horton
work 207-838-0084 La Farge, Wis.

Organic Valley, America’s largest cooperative of organic farmers and one of the nation’s leading organic brands, today announced it will raise its supply quota in a move to get farmer-owners from 93% to 100% of their active base on August 1, 2010. A year ago, the farmer owners of Organic Valley pioneered a supply management system to safeguard the farmers’ pay price during a period of slowed growth coupled with near historic lows in farmer pay prices for conventional milk. In 2008, the cooperative experienced 22% growth, while in 2009, sales remained flat. Currently, Organic Valley is projecting sales growth at $610 million for 2010, a 16% increase.

In lieu of cutting their own sustainable-based pay prices, Organic Valley collectively decided to require all dairy farmer-owners to reduce their organic milk supply by seven percent by July 2009. The cooperative voted unanimously to reduce supply rather than cut off a fellow member of the cooperative or reduce the pay price. The move allowed the cooperative to continue at a stable average pay price of $26.50 per hundred pounds of milk.

This week, Organic Valley farmer-owners are receiving a letter from founding farmer and “C-I-E-I-O,” George Siemon, outlining that the quota will be lifted August 1.

“Raising the quota is a great accomplishment for our farmer-owned cooperative, and a testament to our democratic process. One year ago, we committed to create a sustainable solution through a supply management program to avoid farmer pay cuts, artificially deflating retail price at the expense of the farmer, or dropping the farmer off the truck entirely,” said Siemon.

“Thanks to our cooperative spirit and collective problem solving, today we are able to go from 93% 100% active base, having navigated our way through flat sales and historic pay prices without dropping a single farmer,” continued Siemon. “Supply indeed meets demand! This process underscores our mission to save family farms and support rural communities through economic and environmental sustainability, keeping farmers on the land.”

Siemon adds, “Our decisions come from 22 years of experience in collective thinking to guide our organization into the future. We thank each and every one of our 1,631 farmer owners who puts sustainability and the future of the family farm first.”

Organic Valley Family of Farms: Independent and Farmer-Owned

Organic Valley is America's largest cooperative of organic farmers and is one of the nation's leading organic brands. Organized in 1988, it represents 1,631 farmers in 33 states and four Canadian provinces, and achieved $523 million in 2009 sales. Focused on its founding mission of saving family farms through organic farming, Organic Valley produces a variety of organic foods, including organic milk, soy, cheese, butter, spreads, creams, eggs, produce and juice, which are sold in supermarkets, natural foods stores and food cooperatives nationwide. The same farmers who produce for Organic Valley also produce a full range of delicious organic meat under the Organic Prairie Family of Farms label. For further information, call 1-888-444-MILK or visit www.organicvalley.coop, www.organicprairie.coop and the cooperative's farmer website, www.farmers.coop. Organic Valley is also on Twitter @Organic_Valley and Facebook www.facebook.com/OrganicValley .

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P.R. Contact
Elizabeth Horton
Phone: 207-838-0084
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