November 19, 2003

Dreyer's reports financials, facility upgrade...Oakhurst denied home-court advantage...Part of WestFarm workforce returns...YoCream to expand warehouse capacity...Four fired in soy-formula tragedy...Supermarket labor disputes update...Dairy Marketing Mix...Odds-and-Ends...Stock Market Ticker...More news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Dreyer's Grand Ice Cream Holdings Inc. (DGICH) sales jumped $185% to $514.9 million during the third quarter that ended on Sept. 27, compared to $180.8 million in sales in the same quarter of 2002. However, the company reports its financial statement is not directly comparable to the previous year due to the June merger of Dreyer's Grand Ice Cream Inc. (DGIC) and Nestlé Ice Cream Company LLC (NICC). Oakland, Calif.-based DGICH is the new parent company of the two frozen dessert divisions. Profits rose 57%, reaching $81.4 million in the third quarter of 2003 compared to $34.8 million in the comparable 2002 quarter. Company brands represented 68% and partner brands 28% of total net revenues in the third quarter of 2003, compared to 95% and 5%, respectively, for the same 2002 period.

In related news, Dreyer's will invest $7.5 million to upgrade its processing facility in Fort Wayne, Ind. The project will include $6 million in new ice cream filling line equipment and $1.5 million to add 3,400 square feet for freezer and ice cream hardening equipment. The project is expected to be completed in early 2005. The facility currently has seven lines, with the latest added in 2002 at a cost of $10 million. (Fort Wayne News Sentinel-Indiana)

Portland, Maine-based Oakhurst Dairy won't receive home-court advantage in its court battle with St. Louis-based Monsanto. The processor's request to move its labeling lawsuit from Boston to Portland was denied by a federal court this week; the trial is scheduled to begin Jan. 5, 2004, and may last up to two weeks. Monsanto sued Oakhurst over its products labels, which say: "Our Farmers Pledge: No Artificial Hormones." Monsanto claims the Oakhurst label implies milk from cows treated with artificial hormones is somehow unsafe. FDA guidelines on labeling regarding rBST call for marketers to inform consumers that the FDA has found no difference in the safety of milk from treated and untreated cows. (Bangor Daily News-Maine)

Nearly 100 WestFarm Foods workers along the West Coast have returned to work following a 23-day strike designed to support fellow Teamsters International members who were locked-out of the dairy company's Seattle and Issaquah, Wash., facilities on Labor Day weekend. The contract issues between WestFarm and Teamsters Local 66 remain at an impasse over the proposed contract that would allow WestFarm to outsource yogurt and ice cream production. (The Bellingham Herald - Washington state)

Portland, Ore.-based YoCream International Inc. is increasing the size of its Portland processing facility by 67% with the purchase of an adjacent property. Additional warehouse space is planned to help meet expected demand for YoCream Smoothie shelf-stable products being produced on YoCream's new aseptic production line.

Four R&D employees from German processor Humana have been fired after an internal review revealed their responsibility for mistakes that left soy baby formula lacking a crucial vitamin. The non-dairy kosher baby formula produced for Israeli company Remedia is believed to have caused the deaths of two babies in Israel. At least 17 more babies are seriously ill from neurological and cardiological complications. German prosecutors are investigating one Humana employee on suspicion of negligent homicide and may extend the probe to others. (Associated Press)

CUSTOMER CLIPS

Supermarket labor disputes update: After three days of closed-door talks, negotiators for 70,000 grocery clerks and three Southern California supermarket chains left on Nov. 12 without reaching an agreement to end the month-long labor dispute. The talks—initiated by federal mediators between the United Food & Commercial Workers union and Safeway Inc. (Vons and Pavilions), The Kroger Co. (Ralphs) and Albertsons Inc.—were the first since the work action began. It is unknown when talks will resume. (Associated Press)...In the Northeast, about 4,000 UFCW workers from Long Island and parts of New York City continue to work without a contract as the sides try to resolve health care benefit issues. The union members are employees at 275 King Kullen, Stop & Shop, Pathmark, ShopRite, Waldbaums and A&P stores. Contracts expired Oct. 25, with the exception of A&P, which ended Oct. 30. In 2002, Local 1500 of the same union settled with many of the same supermarkets. (Newsday-New York)

DAIRY MARKETING MIX

The Cabot Creamery cheese marketing team is on the move. Pittsburgh was most recent stop on "The Cabot Farmers Road Show," the promotional effort behind the launch of Cabot cheese products in Giant Eagle supermarkets. Cabot representatives handed out cheese samples, recipes and T-shirts at a dozen stores, and took instant pictures of kids in a stand-up cow cutout. Cabot additionally hosted more than 200 people at a wine and cheese tasting party. The party's guest list was comprised of about 1,000 "Very Important Pittsburghers" (people who live within 50 miles of Pittsburgh who had either stopped at Cabot visitor centers, wrote Cabot or ordered its products online). Another 50 invitations were awarded through a local radio station. (Pittsburgh Post-Gazette)

An ice cream flavor design contest will help Arlington, Mass.-based Brigham's Ice Cream celebrate its 90th anniversary in 2004. Entries of ice cream names and accompanying ingredient suggestions will be accepted through mid-December, and the winner will be announced during a spring 2004 product launch. The winner's name will appear on product packaging; in addition, the winner will receive an ice cream sundae party for 90 friends, a private tour of the company's processing facility and a 15 cubic-foot freezer stocked with a year's supply of ice cream.

Cuba will purchase 5,500 tons of powdered milk from Minnesota producers, contingent upon the country's qualification to USDA subsidy programs. Additionally, Cuban officials ordered 14,300 tons of corn byproducts from ethanol plants (distiller's grain) for use as high-quality cattle feed to improve milk output and purchased 120 Holstein heifers, 40 sheep and four bison from Midwestern farmers. Fidel Castro has stated that he wants to provide a liter of milk daily to each Cuban child under the age of seven. The deals, a result of a visit to the country by a delegation of Minnesota dairy producers and ag officials, are expected to set the stage for $45 million more in farm exports to Cuba from Minnesota over the next several years. Cuba imports more than $100 million in powdered milk annually. (Minneapolis Star Tribune)

A total of 18 U.S. cheeses won medals in 15 classes at the World Cheese Awards in Olympia (London), England, held Nov. 4-9 and co-sponsored by the U.S. Dairy Export Council (USDEC). Rogue River Blue from Rogue Creamery, Central Point, Ore., was judged third best cheese overall. The company's blue vein cheese won a gold medal as well as trophies from Fine Food Digest for the best blue cheese and USDEC for the best cheese from the United States.

IDFA NEWS

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ODDS-AND-ENDS

The Louisville, Ky., processing facility of Dean Milk Co. Inc. reports it has voluntarily recalled gallon and one-half gallon containers of 2% reduced-fat milk because of contact with eggnog during processing. No illness or allergic reactions have been reported. Recalled milk under the brands Dean's, Winn Dixie, Wesselman's and Great Value may have been distributed to Kroger, Winn-Dixie, Wal-Mart, Wesselman's and convenience stores in Kentucky, Tennessee, Indiana and Ohio...Food marketing directed at children is allegedly fueling epidemic childhood obesity rates and undermining parental authority, according to a Center for Science in the Public Interest report released last week. The report claims that the ads, toys, Web sites, movie and television tie-ins, school programs, and other marketing practices are designed to draw children to unhealthy food products and notes that food advertising to children has increased from $6.9 billion in 1992 to $15 billion in 2002. (U.S. News & World Report, CSPI)...The Cheese Reporter notes in its Archives Column this timely fact: It was 25 years ago that the International Ice Cream Association (known then as the International Association of Ice Cream Manufacturers), the Whey Products Institute and Foremost Foods Company jointly filed a petition with FDA to amend the standards of identity for frozen desserts to permit the optional use of acid- and modified-whey products. The FDA granted this request. After more than two decades with the same standards, IICA earlier this year petitioned FDA to again modernize the frozen dessert standards of identity to allow for improvements in ingredients through whey fractionation. The National Milk Producers Federation and the American Dairy Products Institute have opposed what IICA sees as "the ice cream industry's request to catch up with 25 years of technological developments." (Cheese Reporter, IICA)

STOCK MARKET TICKER

As of 11/18/03, market close.

Company/Symbol		Last Trade		Change over Previous Close		Change over Last Week's D-brief
ConAgra Foods/CAG Dean Foods/DF Dreyer's/DRYR General Mills/GIS Groupe Danone/DA Hershey Foods/HSY Horizon Organic/HCOW Ingles Markets/IMKTA Kraft Foods/KFT Kroger/KR Ruddick Corp./RDK Safeway/SWY Saputo/SAP.TO SuperValu/SVU Unilever PLC/UL Weis Markets/WMK Wimm Bill Dann/WBD Winn-Dixie/WIN		24.25 32.01 77.56 44.51 30.47 77.25 23.90 10.01 31.00 17.89 16.75 20.10 27.95 24.35 34.50 34.53 19.60 07.87		-0.01 -0.16 +0.04 -0.81 +0.34 -0.15 -0.01 -0.03 -0.20 +0.07 +0.29 -0.12 -0.15 +0.05 -0.37 -0.12 -0.45 +0.05		+0.39 -0.07 +0.30 +0.65 +0.79 +0.05 +0.05 -0.38 +1.64 +0.03 +0.26 -0.07 -0.76 +0.17 -0.38 -0.84 -0.42 +0.14
Source: Yahoo! Finance

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