The Scoop - Spring 2020

SPRING 2020 | VOLUME 1

EXPANDED DFA FAMILY, SAME MISSION

Angela Wood and Brealynn Oliver Sherwyn Wood Dairy | Stephenville, Texas

SUSTAINABILITY

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INFORMATION SECURITY

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BRAND TALK ‘

OUR SOCIAL RESPONSIBILITY

STAYING VIGILANT AGAINST CYBERSCAMS

POWERING THOSE IN NEED

Learn more about DFA’s journey toward a sustainable future

New initiatives keeping us safe from cyberattacks

A donation of Borden® Cheese Crisps ‘n Cubes snack trays

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COOPERATIVE

EXPANDED DFA FAMILY, SAME MISSION In early May, the DFA family grew in a big way. With the acquisition of a substantial portion of Dean Foods’ assets, we welcomed a variety of employees from every job type to our ranks, making us now 20,000 talented employees strong.

While this acquisition wasn’t part of our strategic plan, when Dean Foods filed for bankruptcy last year, we knew we needed to do something — for our family farm-owners and the U.S. dairy industry. As Dean was the largest dairy processor in the country and a significant customer of ours, our focus was to ensure continued secure markets for our members and minimal disruption to the industry, including preserving jobs across the nation.

“I want to thank all of our employees — new and longtime — for helping us get here. We should all feel very proud of preserving a critical piece of the dairy industry and ensuring we continue to bring value to our family farm-owners,” says Rick Smith, president and chief executive officer. “While a great deal of work went into getting us to where we are today, there is still much work ahead. With all of your continued dedication and commitment, I believe we can turn around this business and be stronger for it.”

“Legacy Dean Foods” is now part of DFA’s Dairy Brands Division. As we did not acquire all of Dean’s business, this is the best way to organize the assets we’ve acquired. This division is made up of regional fluid milk and ice cream businesses with leading brands supported by strong customer and consumer relationships; aseptic and extended shelf-life dairy; and local and regional-branded cheese and butter products.

The division will be led by Alan Bernon as president and chief executive officer. He has served as a senior advisor to DFA since 2008 and was instrumental in getting this transaction to the finish line. “While there may be a few challenges along the way, I think we are all excited and looking forward to this new chapter and a brighter future,” Alan says.

Dairy Brands is now organized into three operating units: North, South and Ice Cream, and is led by a team with years of experience in the dairy industry.

Dairy Brands North Pat Panko is leading Dairy Brands North as president and also continues in his role as executive vice president of DFA. He is responsible for the Central, Mideast and Northeast regions, as well as the division’s cheese and butter businesses and extended shelf-life groups.

Dairy Brands South Tom Murray leads the Mountain, Southwest and Southeast regions, national logistics, the legacy customer service center team and national sales for small format and foodservice. He began his career with Dean Foods in 1993 in Orem, Utah, as an ice cream plant manager and he has progressed through general management of fluid, ice cream and cultured business units to regional, group and national leadership roles in various functions. Most recently, Tom was the senior vice president and chief commercial officer for Dean Foods where he oversaw the national fluid commercial business and led sales responsibilities.

Dairy Brands Ice Cream Starting June 1, Robin Galloway will serve as president of Dairy Brands Ice Cream, where she will oversee the division’s frozen group. She most recently served as president and chief executive officer of Fieldbrook Foods where she led the turnaround and stabilization of the business under new management. With more than two decades in the food and dairy industry, Robin has held a variety of finance leadership positions with household brands, including more than 10 years at Dean Foods.

Along with an expanded number of employees, we nearly doubled our processing facilities. The processing capabilities of these facilities will help support our mission to deliver value to our family farm-owners as a global dairy cooperative by securing milk markets and strengthening our processing network.

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*Representative listing of DFA-owned brands

To ensure these plants are profitable for our family farm-owners, we are already making some exciting changes. The division will operate under a general manager model and will leverage the local and regional brands associated with each facility, creating cohesive operations across Dairy Brands. “This will allow for increased decision making at the local level, resulting in the ability to promptly make decisions that meet the needs of the specific facility. Evolving to this model will play an integral role in our future success and help ensure we return to profitability,” Alan says.

Moving forward, together Whether you’ve been a DFA employee for 15 years or several weeks, we are all part of our Cooperative, proudly founded and owned by farmers. The hardworking dairy farm families we work for are diverse — in farm size, location and more — but they are united in their common desire to deliver all the possibilities of dairy to consumers around the world.

We too are bound together by that goal. As DFA employees, we have much in common with the family farmers we serve. We are also diverse. From boots-on-the-ground field representatives to finance professionals in our offices and frontline workers on our plant floors, we all have different roles, responsibilities and strengths, and we are located across the country in our now more than 400 offices, plants, truck depots and labs.

“Like our family farm-owners, we are dedicated to putting nutritious, wholesome dairy products on families’ tables, even as — or especially as — the world changes around us,” Rick says.

Throughout the long acquisition process and with challenges compounded by the coronavirus (COVID-19) pandemic, we witnessed all our employees continue to work hard, just as our family farmers continued to produce milk and run their farms, to ensure families across the nation had access to nutritious dairy.

As with any transaction, there are still details to work out. “We may experience some growing pains as we all settle in, but growing pains can be good,” Alan says. “They mean we’re adapting, improving and changing for the better. I’m excited about the great team we have in place and I’m confident they will help us as we move into this new future.” thescoop | Spring 2020

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SUSTAINABILITY

OUR SOCIAL RESPONSIBILITY To celebrate Earth Day on April 22, we launched DFA’s 2020 Social Responsibility Report. From detailing DFA’s science-based target to our impact on communities through volunteer events, this report not only helps tell the story of our family farm-owners, but the story of our Cooperative from this past year.

U.S. Department of Agriculture Secretary Sonny Perdue being interviewed by DFA member Josh Cleland of Erie, Colo.

COOPERATIVE

DFA 101: MAKING OUR MEMBERS HEARD IN WASHINGTON, D.C. When the more than 13,000 family farm-owners of DFA speak through a single, unified voice, legislators listen. And while our members can have a powerful influence in Washington, D.C., they need a team to guide and organize their efforts so that unified voice is heard. That’s where our legislative affairs team comes in.

The legislative team at DFA works to inform members of Congress and their staffs about issues that affect dairy producers. They do this in a number of ways, including: DFA Advancing Dairy: DFA Advancing Dairy unites our members’ voices to advocate for issues important to the dairy industry’s future by supporting or opposing statewide initiatives that could impact markets or on-farm practices, hosting events to educate decision-makers about our industry and other activities.

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Member fly-ins: Hearing directly from dairy producers is the most impactful way to speak with legislators. DFA’s legislative team regularly schedules visits to Washington, D.C., for our family farm-owners to speak with their senators and representatives about issues affecting them on their farms

• myLegislator: Through the myLegislator website, members can access resources to help find their elected officials, host a legislator on their farm, send an email to their senators or representatives, and more DFA Political Action Committee: Through DFA PAC, we make sure our farmer-owners’ interests are heard by financially supporting candidates in federal elections who will work to improve the future of the dairy industry.

DFA helps members stay apprised of legislative issues impacting their farms through regular publications containing the latest news, by speaking at Area and national meetings and through phone calls, emails and farm visits with our members.

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From recycling paper and using energy efficient lightbulbs to composting manure and creating energy in biodigesters, the members and employees of DFA are fulfilling our social responsibility.

As part of the 1-billion-person-strong global dairy community, we are dedicated to nourishing 6 billion people around the world — responsibly and sustainably.

And that’s why, using our overall Cooperative strategy as a foundation, we’ve created a sustainability strategy designed around three pillars: our planet, our people and our communities. Focusing our efforts in these areas helps us set our priorities and stay committed to responsible stewardship in the dairy industry and beyond — something our family farm-owners have been doing for generations.

We’re proud of our efforts to decrease our environmental footprint and increase our positive impact on communities around the globe.

As we continue to adapt to new obstacles in an ever-changing world, it’s important to remember the work we do matters. Our commitment to communities around the world leaves a mark. As a farmer-owned Cooperative, ours is A Mark of Purpose – our social responsibility.

DFA’s 2020 Social Responsibility Report is now available on dfamilk.com.

SUSTAINABILITY PILLARS OUR PLANET

OUR PEOPLE

OUR COMMUNITIES

Lauren, Paul, Collin, Kylie Danbom | Brindeiro & Danbom Dairy | Turlock, Calif.

FROM THE FARM

THE ORIGINAL RECYCLERS Dairy farmers don’t just talk about land stewardship. For them, it’s a way of life and a commitment they take to heart. The dairy industry’s focus on minimizing its environmental impact has been around for decades.

For Paul Danbom of Brindeiro & Danbom Dairy in Turlock, Calif., a commitment to the land means a commitment for future generations. “Not only from the environmental side — I want to see it well taken care of and well maintained for society — but for my own reasons. This was the land that was my greatgrandfather’s, given to my mother, given to me, and hopefully, I can pass it to my kids,” says Paul.

The Danbom family milks about 800 cows on an operation established shortly after World War II with a focus on reusing products from the dairy to help them be more resourceful and eliminate unnecessary waste.

“We’re making our own fertilizer using the excess manure from the dairy, and by making our own organic fertilizer from the dairy manure, it allows us to use less chemical-based fertilizers. It’s become a very important part of both our orchard operation and dairy operation,” says Paul.

Like many California dairy farmers, Paul also runs an almond operation where his family ships 250,000 pounds of almonds annually — and those almond trees take full advantage of the nutrients coming from the excess manure on the dairy.

“We have roughly three cubic yards of trash a week come off this place that’s not reusable. By taking the manure from the cows, processing it and putting it on the trees, it just brings our waste down to zero,” says Paul.

The family is proud to leave a smaller footprint on the Earth by reducing and recycling every way they can.

“We want to be as environmentally conservative as we can because we want that ground to be right. We don’t want to do anything to hurt the ground,” says Paul. “Nobody wants more than a farmer to be a good steward to the land.” thescoop | Spring 2020

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COMMUNITY

#GALLONSOFGOOD FOR JUNE DAIRY MONTH During times of uncertainty, one thing is certain: Good continues to happen all around us — in our communities and throughout our Cooperative.

That’s why there’s no better time than June Dairy Month to show our appreciation for our family farm-owners, essential workers in the dairy industry and community partners for their dedication and dependability in delivering nutritious dairy to tables across the country and around the world.

June Dairy Month officially kicked off with World Milk Day, Monday, June 1, and we’re celebrating all month long.

Share the love. DFA will share the milk.

Throughout the month, we’re encouraging consumers, employees and industry partners to share what they’re grateful for on social media using the hashtag #GallonsOfGood. For every post, we’ll donate $1 to our Farmers Feeding Families Fund, which was established in early April to help get dairy products into food banks across the country and distributed to those who need them most.

Show your support by posting your gratitude on Facebook, Instagram, Twitter or LinkedIn with #GallonsOfGood. Because just like every drop of milk matters, all that good makes a big difference.

Follow @dfamilk on social media and check dfamilk.com/dfacares to see our milk tracker, which highlights donations coming in and going out all month long.

INFORMATION SECURITY

STAYING VIGILANT AGAINST CYBERSCAMS It only takes one of us clicking on a phishing email or malicious link to expose DFA to a cyberattack.

Whether you have a DFA-issued phone, use a DFA laptop or access a kiosk at a plant, we’re all at risk, and it’s up to all of us to remain cautious. DFA’s information security team, a branch of DFA’s Information Technology (IT) Department, is here to help.

New initiatives by the team are focused on keeping us protected from breaches and cyberattacks. In April, the team tested our readiness in the case of a phishing attempt by sending a phishing test email claiming to be from DFA Human Resources with the subject, “Company Reopening Schedule.” While 25% of us unfortunately clicked on the link, many employees did report the email as suspicious.

“We’re not trying to trick anyone,” says Sherry Callahan, chief information security officer. “The results help us better understand how well employees identify and respond appropriately to phishing attacks.

And, because you get instant feedback, if you’ve clicked on one of our phishing tests, it also serves as a good learning tool.”

Last year, the team implemented a new quarantine email filtering process to prevent spam, phishing and other malicious emails from getting into our inboxes in the first place. The system blocks anything it identifies as malicious outright and any potential junk emails get moved into quarantine, where employees can determine if they want to keep them.

“The basic email protection we were getting from Microsoft® Office 365 just wasn’t cutting it, and a high volume of phishing and spam emails were making their way into our mailboxes,” Sherry says. “Each of those emails represents a risk to DFA — that’s the risk of one of us being tricked into replying with our password or clicking on a malicious link or attachment that then infects our computers and opens a door for attackers to access our systems.”

The new filtering process has been successful in blocking malicious and unwanted email — more than 360,000 a month. Besides better security, the move also means fewer annoying emails.

“The response has been positive overall, and we’ve heard comments like, ‘I love not having my mailbox cluttered with garbage email,’” Sherry says.

Even with these new measures, Sherry encourages every employee to create strong passwords and pay attention to suspicious emails. “No technology is perfect, and the occasional bad email still makes its way through, so it’s important that we don’t become complacent,” she says.

She also recommends trusting your instincts. “We often hear, ‘I thought that email looked funny,’ when following up with employees who have clicked on a phishing email. If you don’t recognize the sender or the email contains an attachment or link that you weren’t expecting, look it over and if it doesn’t seem right, either don’t act on it or send it to us.”

Employees should report suspicious emails by clicking the Report Phish button on the Microsoft Outlook toolbar.

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What is your main role with DFA Farm Supplies?

To bring value to our DFA members by informing them of new products and programs that are cost efficient, save them time and help make improvements on their farm.

Describe a moment or opportunity that has made you proud to work at DFA. At a member meeting in Idaho, one of our members stood up and told everyone there how thankful he was to be a DFA member. That through it all, our members have a market for their milk, their milk was still getting picked up every day and they still had the opportunity to do what they love. To hear other members agree and share their support for DFA was a pretty gratifying moment. Also, the fact that I can be a member-owner within our Cooperative, to then later work for them on the milk quality side as a field representative and then work in member services, all within the same company, is pretty incredible.

EMPLOYEE SPOTLIGHT

JEREMY PICKETT Large farm area sales manager, DFA Farm Supplies A former DFA farmer-owner, Jeremy and his family joined DFA in 1998 and operated their dairy through 2015. Since then, Jeremy has been with DFA as a full-time employee. Currently, he’s based out of Berthoud, Colo., and serves DFA Farm Supplies as a large farm area sales manager.

What is the most exciting part of your job?

I love going to dairies and meeting with our members. The fact I get to do it in the most beautiful area in America is just amazing.

What is your relationship with members like?

It’s pretty easy getting along with dairy farmers — it’s great getting to know them. I believe coming from a dairy and having those experiences has really helped me relate to our members, build relationships and trust. I love some of our discussions about how they grew up on the farm, how things used to be or other unique stories. The other day I helped one of my members get cows back in after they got out. It’s funny, I used to hate when that happened on my dairy but now, I look forward to it!

What is the best part about working for DFA Farm Services?

The people. We have such a great support system. I have great managers, co-workers and a whole team of people trying to help me look good out here. I honestly love what I do. Not many people in this world get to do what they love and call that their career. Seriously, I’m ridiculously blessed.

COMMUNITY

FARMERS FEEDING FAMILIES FUND EXCEEDS DONATION GOAL DFA and our family farm-owners are dedicated to feeding the nation with nutritious, wholesome dairy, and even more so during times of need.

Thanks to generous donations from our family farm-owners and employees, we surpassed our goal of raising $500,000 for our Farmers Feeding Families Fund, which was established through the DFA Cares Foundation in early April to help get dairy products into food banks in communities where we live and work.

With the coronavirus (COVID-19) pandemic causing school and meal delivery service closures, as well as forcing restaurants and other food service businesses to shut down, and putting millions of people out of work, families across the nation are facing uncertainty about how to put food on their tables. During times of crisis, DFA is committed to helping in any way we can.

The initiative was kickstarted with funds donated by our family farm-owners and employees. We started by identifying food banks in communities where DFA has a presence and also asked our members

to help us identify rural community food banks in need of funds to purchase dairy products. Through the fund, we are providing monetary donations to food banks across the country, including many nominated by our family farm-owners.

“DFA has a long history of providing assistance to food banks and others during times of need. It was especially important now, when we’re all facing the unknown, that we support our communities, and it’s something that our dairy farmer-owners want and expect of us as well,” says Jackie Klippenstein, senior vice president, government, industry and community relations. “We’re proud our Farmers Feeding Families Fund can help rural community food banks provide their clients with fresh fluid milk and other dairy products.” thescoop | Spring 2020

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Name | Dairy | City, St.

BRAND TALK

POWERING THOSE IN NEED To help provide nutritious snacks to those in need, Borden® Cheese donated 48,000 units of its new product Borden Cheese Crisps ‘n Cubes snack trays to Second Harvest Food Bank of Middle Tennessee, which is part of the national Feeding America® network.

“We’re thrilled to help Second Harvest Food Bank of Middle Tennessee, while also providing on-the-go nourishment to some of the frontline health care personnel who are working so hard day in and day out to help fight and control this pandemic,” Flavia adds.

The donation, which was delivered to Second Harvest Food Bank of Middle Tennessee in Nashville, Tenn., was distributed to hungry adults and children in 46 counties across the state. Additionally, a portion of the donated product went to essential health care workers on the front lines at Nashville General Hospital.

As demand for food assistance rises with the coronavirus outbreak, Feeding America, with its more than 200 affiliates across the country, has projected a $1.4 billion shortfall in the next six months alone.

“COVID-19 has brought unpredictability to all of us,” says Flavia Panza, vice president of commercial strategy and brand growth for DFA Dairy Brands. “We were in the initial stage of bringing this innovative, all-natural cheese snack to market. But, as grocery stores have needed to make quick adjustments to keep up with increased consumer demand, we found ourselves in a situation where we had inventory surplus in the area and knew we could put these products to good use and help people who needed them right now.”

“We are so grateful for this generous donation during this unprecedented time of need,” says Nancy Keil, president and chief executive officer of Second Harvest Food Bank of Middle Tennessee. “This contribution will make a difference for health care workers on the frontlines and so many local families.”

Borden Cheese Crisps ‘n Cubes are a low-carb, on-the-go snack option, which was launched earlier this year. Each snack tray features a duo of crunchy 100% oven-baked cheese (crisps) and delicious 100% real cheese (cubes). Borden Cheese Crisps ‘n Cubes are gluten free with no added hormones and no added sugar and provide 9 grams of protein and less than 1 gram of carbohydrates per tray.

dfamilk.com | © 2020 Dairy Farmers of America | June 2020

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