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2019 VT Organic Dairy Producers Conference
Gary HirshbergChief Organic Optimist
Stonyfield Organic
2,000.00
2,500.00
3,000.00
3,500.00
4,000.00
4,500.00
2013 2014 2015 2016 52 weeks ending 11/12/2017
Milk Volume – All Outlets (Mil Gallons)
% Chg vs Yago NA -4.1% -1.3% -1.6% -1.7%
Milk prices in 2014 were high relative to recent years
with white gallon costing $.59 more per gallon than 2017
Source: NCP; Total US - All Outlets
Long-term decline in milk volume
2
82.0% Switching to competitive
beverages(-61.24 mil gal)
15.1%Decreased buying among existing buyers(-11.26 mil gal)
2.9%Lost milk buyers(-2.13 mil gal)
Source of White Milk Volume Loss
Source: NCP; Total US - All Outlets; 52 Weeks Ending 11/12/2017 vs YAG
Lost milk buyers accounted for a small amount (2.9%) of white milk’s volume decline
3
35,483,894
7,441,891
5,643,1774,521,305 4,453,241 3,776,863
2,316,087 2,293,406605,041 354,816 78,098 17,492
Bottled Water Coffee Tea Juice Plant Beverages Sports Drinks Energy Drinks Flav/Other Milk Yogurt Drinks Club Soda/Tonic Other SSBeverage
Smoothies
White Milk Volume Loss to Competitive Switching (Gallons)
Source: NCP; Total US - All Outlets; 52 Weeks Ending 11/12/2017 vs YAG
53.0% 11.1% 8.4% 6.7% 6.6% 5.6% 3.5% 3.4% 0.9% 0.5% 0.1% 0.03%Share of
Switching
4
Plant beverages accounted for 6.6%
white milk’s volume loss
Half of White Milk’s loss went to Bottled Water. Coffee, Tea, Juice, Plant Beverages and Sports Drinks also gained from White Milk’s decline.
Volume Gains Due to Product Switching
Net Volume Change
Net % Chg Yago
Index% of
Switching Gains
3,433,979 +0.10 63 60%
1,353,076 +0.04 135 24%
922,350 +0.03 127 16%
39,368 +0.00 238 1%
Soda
Instant Coffee
Orange Juice
Single Cup Tea
Source: NCP; Total US - All Outlets; 52 Weeks Ending 11/12/2017 vs YAG
While white milk gained the most volume from soda, interaction was low for soda but higher for these products, indicating that consumers see them as more substitutable
5
A Small Bright Spot: White Milk gained some volume from a few beverages, with 60% of its gain
linked to soda
LONG TERM US ORGANIC MILK SALES TRENDS REMAIN POSITIVE
Since 2010, Organic Milk has grown 90MM Gallons or +4.6% CAGR. The last 3 years have seen flat volume at 300 mm gallons.
211.7
242.3252.0
264.6
289.0 284.7
300.9 301.1 302.9
2010 2011 2012 2013 2014 2015 2016 2017 2018
ORGANIC MILK SALES IN U.S.
3.3%ORGANIC AS %
OF TOTAL MILK4.9% 5.2% 5.4% 5.5%4.4% 4.9%4.1%3.9%
MM GALLONSCAGR
8 YR
4.6%
4 YR
1.2%
Total Dairy Organic Dairy
Time Period Dollars$$ % Chg Dollars
$$ % Chg
Year Ended Jan 2017 $51,582,053,011 (4.6%) $3,481,098,773 7.1%
Year Ended Jan 2018 $51,434,846,315 (0.3%) $3,553,839,872 2.1%
Year Ended Jan 2019 $51,668,990,046 0.5% $3,600,130,414 1.3%
Last Three YR $$$ Details
Northeast and Vermont Have Outperformed National Over Past 4 Years
-1.8%-2.5%
-1.2%-0.6%
0.1%1.3%
National Northeast Vermont
-1.8% -1.2%-2.3%
VOLUME
5.5% 5.4%7.7%
-5.9%
-4.1%
-2.0%
0.3% 1.4%
4.3%
National Northeast Vermont
-5.3% -1.5%-3.3%
DOLLARS
12.3% 10.2%15.1%
TOTAL MILK
2018 ORGANIC
MILK AS % OF
TOTAL MILK
Conventional
Organic
MILK4 YR CAGR
Organic milk sale volume was flat to down slightly over past four years in US and Northeast. Conventional decline has been less in Northeast and Vermont, than national.
Yogurt Trend in Opposite Direction – Nat’l outperforms NE & VT
-2.0% -2.1%
-1.2%
2.3% 2.0%
-0.7%
National Northeast Vermont
-1.9% -1.1%-1.8%
VOLUME
3.8% 13.2%6.9%
-1.0%-1.4% -0.2%
6.6%
5.9%
2.0%
National Northeast Vermont
-0.7% 0.1%-0.9%
DOLLARS
4.9% 12.5%8.2%
TOTAL
YOGURT
2018 ORGANIC
YOGURT AS %
OF TOTAL
YOGURT
Conventional
Organic
YOGURT4 YR CAGR
Organic yogurt represents 3.8% of national yogurt volume, while 6.9% of Northeast and 13.2% of Vermont
Organic Milk Sales per capita
10.8 10.6 10.3 10.1 9.8
0.60.6
0.60.6
0.6
2014 2015 2016 2017 2018
SALES PER CAPITA (GALLONS)
9.1 8.8 8.6 8.4 8.2
0.70.7
0.70.7
0.7
2014 2015 2016 2017 2018
8.3 8.0 8.2 8.0 7.9
0.40.4
0.40.4 0.4
2014 2015 2016 2017 2018
NATIONAL NORTHEAST VERMONT
Conventional Organic
US Organic milk sales per capita have held steady over the past 4 years. But Conventional milk sales have declined by 1 gallon per capita throughout the US and northeast .
The VT decline has only been half that amount.
Yogurt Sales per capita
10.2 10.4 10.19.6 9.2
0.3 0.30.4
0.40.4
2014 2015 2016 2017 2018
YOGURT SALES PER CAPITA
11.8 12.0 11.711.2 10.7
0.7 0.7 0.80.8
0.8
2014 2015 2016 2017 2018
11.5 11.6 11.5 11.2 10.9
1.7 1.6 1.61.5
1.7
2014 2015 2016 2017 2018
NATIONAL NORTHEAST VERMONT
Conventional Organic
US Organic yogurt sales per capita have grown slightly or held steady over the past 4 years. Conventional yogurt sales have declined by 1 gallon per capita throughout the US and
northeast . Organic is chosen less often in VT than US for milk, but 2X as often for yogurt.
30 Years of Sustainable Dairy Pay Price
https://www.nielsen.com/us/en/insights/news/2018/tops-of-2018-organic.html
https://www.nielsen.com/us/en/insights/news/2018/tops-of-2018-organic.html
https://www.nielsen.com/us/en/insights/news/2018/tops-of-2018-organic.html
75% of millennials are willing to pay more for sustainable offerings
66% willing to pay more to buy from companies committed to positive social and environmental practices
Values Matter to Millennials
21
Jump-starting the next generation of organic farmers
As the 1st organic dairy incubator
farm in the U.S., Wolfe's Neck Farm
will be a regional hub for research,
demonstration, and teaching in
sustainable organic dairy and
pasture management.
Launched with a $1.63MM grant
from Danone Ecosysteme Fund and
Stonyfield.
New Studies About Pesticides/Health Come Out Monthly
https://www.ewg.org/childrenshealth/glyphosateincereal/
27
Organic: The Best Way to Protect Yourself and Your Family
“Now a new French study that followed 70,000 adults, most of them women, for five years has reported that the most frequent consumers of organic food had 25 percent fewer cancers over all than those who never ate organic.
December, 2018
Those who ate the most organic fruits, vegetables, dairy products, meat and other foods had a particularly steep drop in the incidence of lymphomas, and a significant reduction in postmenopausal breast cancers.”
Curl, C. Estimating Pesticide Exposure from dietary intake and organic food choices. Environmental Health Perspectives, 2015, 123, 5.Baudry, Julie, Karen E. Assmann, Mathilde Touvier, et al. Association of Frequency of Organic Food Consumption With Cancer Risk. Findings From the NutriNet-Santé Prospective Cohort Study. JAMA Internal Medicine, 2018, 178(12):1597-1606.
Natural & Non-GMO Do NOT Mean Organic
Source: Organic Foods Production Act of 1990
30
We invite bloggers from across the USA to join us on our Farm Tours to help them learn the organic difference of our company.
2017-2018
Stonyfield
Influencer
Farm Tour
Overview
THE 2017 STONYFIELD VERMONT FALL FARM TOUR
Design Mom:
Why I’m Obsessed with Organic Farming
“I’m telling you, if you’ve had worry over dairy, it would totally disappear if you saw Julie’s farm. It’s basically a super healthy mini ecosystem. The cows nourish the earth, the earth nourishes the cows. With no chemical run-off, no algae blooms, no dead zones, no waste...it’s amazing.”
GABRIELLE BLAIR, 450,000 Followers
What’s Gaby Cooking
“The whole trip was incredibly eye opening and while I’m not trying to tell everyone that everything needs to be organic, I’m certainly making changes here and there to make my eating as clean as possible! There is a TON of info on their site if you want to read more about it right here!.”
GABY DALKIN, 1.2 Million Followers
Why Purchase Organic Dairy?● It’s better for you. Because it comes from cows that are
actively grazing on grass, as nature intended. Organically raised cows spend their days outside on pasture so the milk they produce is significantly higher in Omega-3 fatty acids and CLA (conjugated linoleic acid), heart-healthy fats that can help lower bad cholesterol and increase good cholesterol. There’s also compelling evidence that many organic fruits and veggies are more nutritious, too.
● It’s better for our children’s health. Research has demonstrated that an organic diet can dramatically reduce pesticide levels in kids’ bodies.
● It’s good for the planet. One of the main goals of organic farming practices is to avoid soil contamination as well as rivers, drinking water, and air with toxic persistent chemicals.
● It’s also better for the farmer and their neighbors, as they aren’t exposed to potentially carcinogenic herbicides.
● It’s better for the bees.”
GINA HOMOLKA, 18 Million Followers
2018 Stonyfield & Blue Apron Farm Tour7 blog post totalBlog UVM Combined: 12,386,000Instagram Combined: 3,440,500Engagement Rate Average: 1.54%CPM Average: $12.83
2018 Southern VT Fall Farm Tour7 blog post totalBlog UVM Combined: 3,174,000Instagram Combined: 663,000Engagement Rate Average: 3.5%CPM Average: $7.52
TOTAL: 41.4 MM Impressions!!!!!Average ER: 3.96% (Industry benchmark 1-3%)Ave CPM: $9.06 (Industry benchmark $11-$30)
2017 VT Fall Farm Tour7 blog post total
Blog UVM Combined: 860,000Instagram combined: 1,451,800
Engagement Rate Average: 7.10%CPM Average: $10.15
2018 West Coast Farm Tour6 blog posts total
Blog UVM Combined: 2,281,500 Instagram combined: 661,600
Engagement Rate Average: 3.7%CPM Average: $5.74
2018 Stonyfield & Blue Apron Farm Tour7 blog post total
Blog UVM Combined: 12,386,000Instagram Combined: 3,440,500
Engagement Rate Average: 1.54%CPM Average: $12.83
2018 Southern VT Fall Farm Tour7 blog post total
Blog UVM Combined: 3,174,000Instagram Combined: 663,000
Engagement Rate Average: 3.5%CPM Average: $7.52
THANK YOU !!