March 14, 2014
Methuen, Mass. -- Agri-Mark announced a profit of $11 million after taxes for 2013, up from the previous year’s profit of $10.2 million. This is the seventh year in a row of earnings above $10 million for the dairy cooperative’s 1,200 Northeast dairy farm families. Agri-Mark’s farmers receive 100% of the profits generated from the sale of their milk and Cabot and McCadam dairy products each year.
Agri-Mark’s year-end profit allocation to member dairy farmers was $.34 per hundredweight (cwt.) or roughly $.03 per gallon for milk each member farm family marketed through the cooperative during 2013. A hundredweight, which amounts to 11.6 gallons, is the wholesale measure for buying or selling milk. Agri-Mark’s year-end profit represents earnings of about $9,000 for the average member farm. Profit checks were just recently mailed to all Agri-Mark farmers.
These year-end profits come in addition to a record $23.4 million in payments that Agri-Mark farmers received in their monthly milk checks throughout 2013 for extra high milk quality and other premiums, as well as another $6.5 million in farm milk hauling subsidies. Co-op members also received a $.7675 per cwt. Section 199 IRS tax deduction worth a total of $21 million. This combines to almost $62 million in benefits to members that the co-op generated last year in addition to providing many other valuable services that the membership has asked the co-op to provide.
“This past year our overall business continued to generate profits for our farmer-owners, despite a very challenging marketplace,“ says Agri-Mark CEO Dr. Richard Stammer. “We saw continued growth in our naturally aged cheddar and fresh Cabot butter sales. We hope to keep our sales momentum moving forward going into 2014 by introducing our new line of premium cheddars, called our Legacy Collection, over the next several months.”
Stammer says that aged Cabot cheddar remains the co-op’s top-selling product year after year, so the cooperative has expanded upon this success by developing three unique, premium cheddars - Alpine Cheddar, White Oak Cheddar and Farmhouse Reserve Cheddar- that are only produced by Cabot Creamery. The co-op’s CEO says that these new products will help the farm families’ business grow in sales and enter into new markets with unique products in addition to their traditional line of cheeses.
Neal Rea, a dairy farmer from Cambridge, N.Y., who serves as the cooperative’s Chairman of the Board, agrees that Cabot’s and McCadam’s continued growth and new product development helps ensure the cooperative earns a higher profitability level for farmers. He says members are satisfied with Agri-Mark’s success to date, but the Board of Directors and cooperative membership are looking to make their business increasingly more profitable in the near future.
“As Chairman, I was able to watch fiscal year 2013 unfold from a mediocre beginning to another very successful year. I continue to appreciate Agri-Mark management’s ability to balance the needs of our business and those of our farmer membership. An $11 million profit and a return of $.34 per hundredweight to the owners is a wonderful accomplishment," Rea says. “We plan to fine-tune our cooperative business even further in 2014, so we can continue to generate even more profits for members.”
Sales of whey proteins nationally and internationally under the Agri-Mark brand were again very strong in 2013. These sales contribute to the year-end profits for farmers and also provide the co-op with good product diversity. Agri-Mark total sales of milk and manufactured dairy products for 2013, including its branded sales, were $952 million, up from $880 million the previous year.
“We know that our monthly milk check is not enough to cover farmers’ expenses and the investments each has made in their own businesses,” says Rea. “Agri-Mark’s mission is to add greater value to our member milk by affording them their share of the brands’ profits, and provide members with the services they want and expect from their cooperative. We will pursue this mission with continued vigor in 2014 and thank our consumers every day for buying our dairy products.”
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Agri-Mark, with $952 million in 2013 sales, markets more than 300 million gallons of farm
fresh milk each year for more than 1,200 dairy farm families in New England and New York. The
cooperative, headquartered in Methuen, Mass., has been marketing milk for dairy farmers since
1913, and actively represents their legislative interests in the Northeast and in Washington, D.C.
Agri-Mark farmers own the award-winning Cabot brand of Vermont Cheddar, butter and
other dairy products in addition to the McCadam brand of New York Cheddar, Pepper Jack and
other cheeses. Cabot has won the award of World’s Best Cheddar twice and McCadam recently
won the award of America’s Best Cheese. Agri-Mark has also invested in operations to manufacture
and market valuable whey proteins globally while also marketing fresh fluid milk from its
local farm families to the region's largest dairy processors. For more information about Agri-
Mark, visit our web site at www.agrimark.coop.