Jul 28, 2022
Organic Valley sees solid year investing in small organic farms
Farmer-owned Organic Valley saw back-to-back years of net income investing in small organic farms, while facing complex supply chain challenges.
The cooperative reported net income of $25 million, using positive cash flows from operations to pay down $21 million of its debt. Organic Valley continued to operate at a slim profit margin, below 2.5%, as it pursued its mission of supporting family farms by focusing on increasing average pay prices to its farmer-members and building capacity to bring on more small organic family farms in the future.
Headwinds from unexpected challenges, including a substantial fire at the Organic Valley Creamery in McMinnville, Oregon, created barriers to fulfilling product demand in 2021. Organic Valley is currently rebuilding the creamery, with stage one for loading and processing completed and active just one year after the fire. Organic Valley has already rehired multiple employees in the region and is building vital local dairy processing capabilities in the Pacific Northwest.
“People across the country continue to seek out Organic Valley products. They want to spend their milk money on something they believe in, and they are helping us save more organic family farms that would otherwise be abandoned by industrial dairy and big ag. 2021 helped set us up to offer membership in our cooperative to small, organic family farms that need a home for their milk, and that is huge,” said Bob Kirchoff, Organic Valley CEO. “By optimizing our workflow, realigning our structures, and maximizing the value of our farmer-members’ products, we were able to improve our net income once again.”
Organic Valley also invested time in 2021 building the foundation for thought leadership programs in sustainability and animal care. With an expanded set of animal care standards, a new carbon insetting program launching in 2022, and new products hitting the shelves across the country, the independent cooperative of nearly 1,800 small family farms is focused on the future of organic food and farming in the U.S.
“Our cooperative exists because of organic family farms, and advancing our mission is at the center of what we do. Farming is at a critical juncture right now. Inflation is affecting farmers across the country. And now, more than ever, maintaining a stable pay price for organic family farms is essential to keep our farmers doing what they love: raising animals in harmony with nature to provide nutritious organic food,” said Steve Pierson, Organic Valley farmer-member and board president.