Canada dairy co-operatives agree merger plans

Canada's largest dairy co-operative, Agropur, has announced a merger with Farmers Co-operative Dairy.

Canada's largest dairy co-operative, Agropur, has announced a merger with Farmers Co-operative Dairy.

Quebec-based Agropur produces 3.2 billion litres of milk at 25 sites across North America creating sales of $3.6 billion from 3,288 dairy farmers, while Farmers Dairy, a part of the Atlantic Canada community for more than 90 years, is owned by 116 member dairy produces and posts annual sales of $176 million.

Leaders from both of the co-operatives believe the merger will strengthen the voice and benefits for dairy farmers through consolidation across each business.

Serge Riendeau, Chairman of Agropur and a dairy farmer in Coaticook, Quebec, said: "The merger of our two co-operatives is a first for Agropur in decades. The merger will allow us to better serve our customers on a national basis, and support the overall objective of consolidating the co-operative milk processing sector for the benefit of the member dairy farmers."

Jeannie van Dyk, Chairman of Farmers Dairy and a dairy farmer from Noel Shore, Nova Scotia, added: "By joining forces, we believe that the new merged entity will be well equipped to ensure a sustainable dairy industry in the Atlantic Provinces. This is a great opportunity for our members to continue to have a voice in the marketing of their milk through ownership in a large national co-operative organisation."

Members will vote on the merger during separate Special General Assemblies, which will be held on March 12. A targeted date for merger is set as April 2, subject to approval from members and the appropriate authorities.

Farmers Dairy produces a number of well-known products under the Farmers brand, these range from milks to a range of ice creams to cheeses and butters/margarine.

Agropur has a history of working with other co-operatives. In 1993 it formed a partnership with Agrifoods International Cooperative to form Ultima Foods, which makes yoghurts under the iögo brand that was launched last year.

As part of its acquisitions strategy, last month Agropur acquired the dry blending business from US dairy co-operative Foremost Farms, which produces a number of ingredients and flavourings for a variety of products.

The dry ingredients produced are used in such products as frozen deserts, beverages and confectionery. 

Robert Coallier, CEO of Agropur, said: “The Ingredients Business is an important sector for the future growth of our organisation in the US, and this investment, which is in keeping with Agropur’s strategies, will allow us to grow in the baking and blending industry."

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