President and
Chief Executive Officer’s report

President and Chief Executive Officer Rick Smith began his report during Tuesday’s Annual Meeting by thanking members, industry guests and Board members for investing their time to attend the meeting. His report provided an overview of DFA and our financials, industry matters, goals and aspirations for the industry and he touched on dairy’s role in preserving our planet.

He kicked off by recapping topics discussed during Monday’s members-only session, including proposed guidelines, capital structure, return on DFA investments and the outlook for the future. He said he expects 2019 to be better than 2017 for dairy producers. “Today, you can do better than any year since 2014,” he said.

Continuing by providing an overview of DFA and the industry, he began with our values of integrity, quality, passion and community. “We live by our values, which are your values,” he said. “We just look at you and say, how do we embody you?” He acknowledged that our number one mission remains the same: to get the milk picked up, sold and our members paid.

We live by our values, which are your values,
— Rick Smith, President and Chief Executive Officer

Recognizing 2018 was a tough year, and perhaps the toughest since 2009, he touched on current issues affecting dairy, both locally and globally, including regulation, natural disasters and industry consolidation. He then highlighted challenges members face every day like domestic and global milk production, trade issues, skim milk powder inventory, milk price and competition from alternative milk products.

Highlighting how DFA provides value to members, he focused on the large suite of Farm Services offered, our commercial operations, plant investments and other exciting ventures like The Creamery in Beaver, Utah, and Craigs Creamery™ in New York.

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In reference to climate change, he noted, “What at first can seem like a problem or an issue, is really an opportunity.” Because customers and consumers today are interested in environmental efforts, he acknowledged that we need to tell the story of what dairy producers are doing to contribute to positive sustainability efforts.

“People want to know what we’re doing about it — how we are helping or hurting,” he said.

Rick also pointed out that many of our members’ farms are already environmental stewards and we need to tell those stories. “Consumers care about the values of the companies they’re buying from,” he said.

We already have a great story about our communities and the unmatched nutrition power of dairy. “Nothing can beat milk,” Rick said. “But our carbon footprint is larger than plant-based beverages and we’ll be that much more successful if we can continue the sustainability improvements.” He also highlighted our vision as an industry of net-zero carbon emissions by 2050.

Rick then mentioned ways members can make positive environmental impacts through soil, enteric emissions, anaerobic digesters and renewable energy, and how DFA can help with these efforts.

Rick concluded by providing a preview of what attendees could look forward to for the rest of Annual Meeting.