Governor Celebrates McCarty Dairy, Dannon Partnership

Press Release

McCarty Family Farms and The Dannon Company today announced the initial accomplishments from the first stage of their new and unique collaboration. Milk from the McCarty Family Farms' dairy cows is now being made into delicious Dannon yogurts at the company's Fort Worth, TX, plant. Additionally, a complete carbon footprint analysis of McCarty Family Farms has been completed and provides a benchmark for progress and a guide to future environmental sustainability projects.

One environmental sustainability initiative of the collaboration that is already yielding benefits is the construction of a milk condensing operation at McCarty Family Farms, which is now operating and reducing the environmental impact of milk shipping. This also allows the farm to reuse the water that is removed during condensing of the milk.

Present today to inaugurate the relationship and the commissioning of the milk condensing operation included Kansas Governor Sam Brownback, Congressman Tim Hueslkamp, Kansas Department of Agriculture Secretary Dale Rodman, Kansas Department of Commerce Secretary Pat George, and representatives of Senator Pat Roberts and Senator Jerry Moran, among many other notable guests.

"I applaud McCarty Family Farms and Dannon for entering into a successful partnership that benefits farmers, the small businesses that support farmers, consumers and the community as a whole," Kansas Governor Sam Brownback said. "This partnership is a fabulous example of how agriculture can create good-paying rural jobs with the potential to spur significant additional job creation in the future."

The Dannon Company, which is the leading selling yogurt maker in the United States, and McCarty Family Farms were both seeking ways to reduce the impact of the volatility of the price of milk and to continuously improve on environmental sustainability. According to McCarty Family Farms, this new relationship enables them to fully understand their customer's needs in terms of milk quality, and milk quality is impacted based on farming practices.

Both Dannon and McCarty Family Farms share the belief that sustainable development encompasses more than environmental stewardship. The two entities are philosophically committed to the belief that no enterprise can succeed in the long run if it turns its back on the society of which it is a part and if it looks only to its short-term economic gain. The two partners define sustainable development in both social and economic spheres, with specific visions for human, environmental, community and animal health.

Since the partnership was initiated, more than 50 direct jobs have been created in rural Kansas, effectively doubling the size of McCarty Family Farms to more than 100 associates. Additionally, the construction of the milk condensing operation required more than 55,000 man hours.

"Creating jobs that are sustainable is key to the future of areas like rural Kansas and the agricultural community," said Ken McCarty, a fourth generation dairy farmer. "Additionally," he continued, "as the dairy has grown, my brothers and I and the rest of our team have sought and found ways to improve our environmental sustainability, including reducing water use, improving our cow herd and using manure to fertilize crops. We're young and ambitious and looking for additional environmental sustainability initiatives, which are always either underway or being planned."

"Dannon began working with the McCartys in 2011 in order to reduce the impact of the volatility of the price of milk and reduce the impact of the Company's environmental footprint and find ways to create a closer, more direct relationship between the farmer and the consumer," said David Lainchbury, Vice President of Sourcing & Supplier Development for The Dannon Company. "The relationship we have today with the McCartys and the milk condensing operation represent early results of our ongoing and ambitious goals. We are proud of this partnership and hope others will see the benefits of this process."

So after several discussions, in 2011 Dannon and McCarty Family Farms entered into a novel relationship, whereby the fourth generation family dairy farmers located in Northwest Kansas now provide milk exclusively and directly to Dannon to supply milk for Dannon's plant in Fort Worth, TX.

Both Dannon and McCarty Family Farms sought this relationship to overcome some of the pricing stability issues and lack of direct relationship between farmer and customer. This is a win-win situation:

1. McCarty Family Farms and Dannon provide improved financial stability for one another during periods of volatility in milk pricing.

2. Dannon and McCarty Family Farms share ambitious goals for reduction of impact on the environment, which can now be implemented based on the direct collaboration.

The specifics of the relationship and agreements between McCarty Family Farms and The Dannon Company are confidential; however, this is a multi-year commitment that is expected to bring benefits to both parties.

Other dairy farms that are interested to explore opportunities with Dannon are encouraged to contact Dannon at mediainquiries@dannon.com.

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