The board of directors for Dairylea Cooperative, Inc., Syracuse, N.Y., voted to merge with Dairy Farmers of America (DFA), Kansas City, Mo. Dairylea’s members will be asked to vote during a special meeting in February 2014.
“Today’s dairy industry is undergoing unprecedented change,” says Greg Wickham, Dairylea’s chief executive officer. “From consolidation in the marketplace and changing farm demographics to a movement toward a global dairy industry, this change presents both challenges and opportunities.”
Dairylea’s farmer board of directors spent the past three years in a comprehensive examination of how to best position Dairylea’s members for the future. This effort involved soliciting member input and guidance from the “2020 Group,” a committee formed in 2010 to gather ideas on generating value beyond the traditional cooperative structure. Among many topics, the group explored how to create market opportunities for its members that peer cooperatives with investments in processing are attaining. Dairylea has been a member cooperative of DFA since 2002.
“Ultimately, the board determined merging with DFA, already a long-time partner in dairy marketing services, would best complement Dairylea’s capabilities and resources, while securing flexibility and increasing value for our members,” Wickham says.
The proposed merger will provide Dairylea members access to growing national and international milk markets, ongoing patronage dividends, tax benefits and other opportunities. Additionally, Dairylea members will become owners of—and enjoy the value-added returns from—the products, plants and partners that comprise DFA’s commercial division.
Conversely, the merger provides DFA members with long-standing customer relationships in the Northeast marketplace, enhanced farm services and expanded access to capital to facilitate strategic growth.
“In many ways, a merger with DFA is simply a continuation of the working relationship that Dairylea has forged with DFA during the past 12 years,” says Rick Smith, DFA president and CEO.