By George Siemon
CROPP Cooperative, commonly known as Organic Valley, is a farmer-owned cooperative that specializes in only certified organic products produced by our members. We are headquartered in La Farge, Wis., and have members in 35 states. We are most well-known for our Organic Valley brand which features organic dairy, eggs, produce and soy beverages. We also have a division that produces Organic Prairie branded organic meats.
We are celebrating our 25th anniversary this year and have a lot to celebrate. With sales at $860 million in 2012, representing more than 10% of all certified organic operations in the United States, and paying a significant premium to our members, we have successfully fulfilled our mission. At the time of this writing, we have a total of 1,825 members (1,546 are dairy farmers) and 723 employees.
Organic Valley is located in rural Wisconsin where it is the largest employer in the region and a desired place to work due in large part to our mission-driven business model of saving family farming through organic agriculture.
As a cooperative, we choose to own minimal infrastructure and instead build long-term relationships with partners in all support sectors of the related food industry. In dairy, we contract with more than 75 dairy processing plants and represent as much as 40% of production in some plants. These co-pack relationships give us great flexibility and provide income to the partner plants.
We are constantly developing new supplies by organic farmers through outreach efforts to conventional farmers who might be interested in transitioning to organic. With field staff in each region and a support staff including three veterinarians, a ruminant nutritionist and a soil agronomist, who are experts in organic production, we are able to support our current members as well as farmers in their transition to organic.
With a national network of farmers, Organic Valley is able to satisfy the needs of the largest customers with a consistent supply with flexibility that dairy markets expect. Having diverse sales of our own brands, providing private label, selling ingredients and bulk milk allows for careful milk management. In addition, the cooperative has thorough policies around supply management and is a leader in developing an active base and quota system model to better manage milk production.
Innovative dairy products
Our cooperative has always been innovative in all aspects. We were pioneers in developing organic standards and production methods. We have and continue to be leaders in the organic industry and serve on many related boards. Organic Valley has a lot of firsts in innovation, including: the first cultured butter, the first UHT national white milk, our new 100% Grassmilk fluid and cheese line, and the upcoming lactose-free half-and-half.
The organic dairy market is led by the educated young mother, with education being the overarching definition of the organic consumer. Organic dairy is around 6% of the dairy supply in the United States, yet it represents more than 10% of the fluid package sales. Organic markets are divided into the mass market and the natural food trade. In the mass market, the offerings are not as diverse as the natural, but the volume is significantly greater. As the organic consumer develops, they buy more depth of products, leading the mass market to carry more and more organic products.
Recovering from a fire
Recently, the cooperative suffered a major fire at our headquarters building. With two- thirds of the building not usable, we have gone through a difficult time. Our employees have been super through this challenge and the business continues to thrive even under this stress. We captured our shared experience of the pioneering and cooperative spirit in a video (see rootstock.coop) that shares the reactions and reflections of our staff immediately following the fire.
Our anniversary has served as a time to reflect on our roots, where we have been, how we got to where we are today and lessons learned along the way. It also is a time of looking forward and cooperating with the future. We want to serve our members’ grandchildren, and as we continue to lead the organic dairy marketplace in the United States and abroad, we are also investing in the next generation of farmer and staff leadership, building our culture and growing our organic mission together.
George Siemon is the chief executive officer of Organic Valley/CROPP Cooperative, La Farge, Wis.
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