January 15, 2003

FDA approval for aseptic dairy-based products from Dean Foods....Kraft responds to FDA warning letter ...YoCream and Dannon team up for foodservice sales....Belfonte Ice Cream & Dairy Foods Co. formed from sister companies....Maola Milk & Ice Cream joins Maryland & Virginia Milk Producers....McDonald's shifts to organic milk in UK .... Kroger launches year-long dairy promotion....Odds and ends...Stock market ticker....more news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Dallas-based Dean Foods Co. reports its Morningstar Foods division has Food and Drug Administration (FDA) approval for shelf-stable marketing of aseptic dairy-based beverages that are processed at Morningstar's Mt. Crawford, Va., plant. The two Stork filling lines at the plant extend the ambient temperature shelf life of dairy-based products to 180 days. The sterile environment bottling technology is being utilized for processing of single serve Hershey's flavored milk and shake products and Folgers Jakada coffee beverages. FDA approval means the company can now offer the products at ambient temperatures at the point of purchase, expanding Dean's distribution and marketing opportunities. A similar line is likely to be installed in the company's City of Industry, Calif., facility later this year. Dean Foods reports it is the first company to use the Stork plastic bottle technology commercially for dairy-based beverages in the United States.

Northfield, Ill.-based Kraft Foods Inc. has responded to a written notification from the FDA for violating federal labeling requirements in connection with its use of milk protein concentrate (MPC) in products including Kraft Singles, Kraft Macaroni and Cheese and Velveeta. The warning is not expected to impact MPC import levels as Kraft reports it will change its label to comply with FDA regulations and will continue to utilize MPC. Kraft reports it is updating its product labeling to reflect additional calcium content and will be labeled as "pasteurized prepared cheese product" so that the products in question would no longer fall under regulated categories.

Following success in other channels, Portland, Ore.-based YoCream International Inc. and Tarrytown, N.Y.-based The Dannon Co. continue to expand the business association they established in 2001. The companies will combine product line sales from both companies for foodservice customers starting in February. The combined line for foodservice includes: cup yogurt; ready-to-drink yogurt smoothies; soft frozen yogurt, custard, ice cream and sorbet; hard pack frozen yogurt, frozen custard, ice cream and sorbet; and fruit/dairy smoothies.

Kansas-based Belfonte Ice Cream Co., manufacturers of ice cream and cultured dairy products, and its sister company, Belfonte Distributing Co., distributors of milk products and other dairy items, are merging to form the Belfonte Ice Cream & Dairy Foods Co. The companies joined operations earlier this year at a new $4.5 million, 50,000-square-foot facility. The company has annual sales of $50 million in the Missouri, Kansas and Oklahoma marketing area.

Maola Milk & Ice Cream Co., New Bern, N.C., will become part of Maryland & Virginia Milk Producers, Reston, Va., in a deal to be finalized Jan. 31. Maola processes and packages fluid milk, packaged ice cream, ice cream novelties, juice and other drinks; it will retain its name and brand identity and will operate as a separate business of the cooperative. The combined fluid processing business is expected to have $160 million in annual sales.

CUSTOMER CLIPS

On Feb. 2, Oakbrook, Ill.-based McDonald's reports it will shift to organic carton milk in its United Kingdom restaurant outlets. The milk will be sourced from British cows, building on the chain's successful shift to "free range eggs" in its breakfast items. The shift will not extend to ingredients in milkshakes. McDonald's restaurants currently sell organic milk and ice cream in Sweden, but the company reports there are no plans to extend organic dairy sales to other countries.

The Kroger Co., Cincinnati, launches its "Fresh ... for Life" marketing campaign to educate consumers about the nutritional benefits of eating more dairy foods. The yearlong campaign includes advertising, in-store signage and targeted promotions. It will encourage consumers to eat at least three servings of calcium-rich milk, cheese or yogurt daily, as part of the ongoing 3-A-Day marketing/education program by the American Dairy Association/National Dairy Council. The company's history of dairy processing and the wide selection of dairy products offered in its 2,400-plus retail stores will be highlighted in the program. Kroger owns and operates 15 dairies, three ice cream plants and two cheese facilities.

IDFA NEWS

Dairy Forum starts this weekend! If you haven't yet registered, it's not too late to attend one of the most important dairy meetings of the year, being held January 19-22, at the La Quinta Resort & Club near Palm Springs, Calif. This year's Dairy Forum program is packed with 24 outstanding sessions on timely dairy topics with high level speakers. For a complete schedule of events, or to register online, click here.
http://www.idfa.org/meetings/forumpro2003.cfm

ODDS-AND-ENDS

Due to shifts in the Montana milk supply, Seattle-based Westfarm Foods reports it will stop bottling and distributing milk labeled as "rBGH-free" (recombinant bovine growth hormone) as of Jan. 16....Maplewood, Minn.-based Schroeder Milk Co. has agreed to pay nearly $100,000 to settle a hazardous waste violation relating to its failure to submit emergency and hazardous chemical inventory reports to state and local officials, the U.S. Environmental Protection Agency (EPA) reports....Marshall, Minn.-based Schwan's Sales Enterprises changed its name to The Schwan Food Company, effective Jan. 1. The company's structure will be reorganized to separate its major business units - Schwan's Home Service, Schwan's Global Consumer Brands, Schwan's Food Service Group, Schwan's Food Manufacturing and the Schwan's Technology Group into stand-alone corporations....A microbiologist at Universite Laval in Quebec City, Ottawa, Canada, has created a "gene gun" to insert genes into Lactococcus lactis, the bacterium that turns milk into cheddar cheese; the tool is said to stop viral infections that ruin cheese and yogurt cultures and can improve the taste profile of cheese.

STOCK MARKET TICKER

As of 1/14/03, market close.

Company/Symbol		Last Trade		Change over Previous Close		Volume
Dean Foods/DF Kraft Foods/KFT Kroger/KR Dreyer's/DRYR Unilever, PLC/UL Safeway/SWY ConAgra Foods/CAG Winn-Dixie/WIN		38.68 38.39 16.30 71.00 38.08 25.80 26.09 16.65		+0.28 +0.71% -0.51 -1.31% -0.08 -0.49% +0.05 +0.07% +0.02 +0.05% +0.20 +0.78% +0.04 +0.15% +0.32 +1.96%		676,100 1,850,600 3,424,300 103,700 188,500 1,910,900 927,600 496,600
*based on Dairy Field's 2002 "Top 100" processor list, highest-ranked publicly held dairy companies. Source: Yahoo! Finance

Click here to view last week's edition of D-Brief.

ABOUT D-BRIEF

D-Brief is written by Dairy Field magazine, a Stagnito Communications Inc. publication, www.dairyfield.com. It is provided for the benefit of the industry by the International Dairy Foods Association (IDFA), www.idfa.org.

D-Brief is sponsored by Polytainers, a leader in the design, production and printing of thinwall rigid plastic containers for the dairy and food industries. Learn more about our sponsor at http://www.polytainersinc.com/.

For editorial content submissions, contact Cathy Sivak, D-Brief editor, at editor@dbrief.org.

To subscribe or unsubscribe to this e-newsletter, contact subscribe@dbrief.org.