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April 9, 2001

Agri-Mark Reports $1.9 Million Profit

Checks now being sent to co-op's dairy farmers

Methuen, Mass. - Agri-Mark, Inc., headquartered in Methuen, Mass., has announced a year-end profit of $1.9 million which will be allocated among the coop's 1,400 dairy farmer-members during the next few weeks. Agri-Mark is the leading dairy farmer cooperative in New England, with more than $520 million in annual sales and 1,400 farmer-members. The company has 600 employees in four locations in New England and is ranked among the top 25 private companies in the region, based upon annual sales. "We had a good year in 2000, and we are anticipating an even better year in 2001 as profits from our new whey protein plant and our growing Cabot brand add to our marketing system," says Carl Peterson, a dairy farmer from Delanson, N.Y., who serves as Agri-Mark's Chairman of the Board. "I"m especially pleased with the continued growth of our value-added dairy business this past year." Agri-Mark officials say better butter markets and aggressive consumer sales and marketing efforts in regard to their Cabot brand of cheddar cheese and other dairy products resulted in a record year for Cabot sales and an overall positive year for the cooperative. Paul P. Johnston, Agri-Mark CEO, says the company was profitable, completed its new whey protein manufacturing plant in Middlebury, Vt., and had continued success with growing our Cabot business. "In 2001, our goals are to improve our dairy farmer member income and further increase profits," he says. From a dairy farmer perspective, Peterson notes that it is important for the co-op to grow its Cabot brand and run dairy plants that help guarantee a market for all of the milk each farm family produces each year. However, he also says that Agri-Mark is working in many other areas to increase dairy farmer income, particularly on the Northeast Dairy Compact. The Compact is a pricing mechanism established in 1997 which allows the New England states to work together to establish prices processors must pay for fluid milk used for bottling. This helps to bolster Northeast farm prices when federal milk prices crash -- usually due to supply/demand conditions in California and other areas of the country. "Our farmers received more than $22 million -- almost $16,000 each -- from the Northeast Dairy Compact this past year," says Peterson, "and getting the Compact renewed is a top legislative priority for the co-op in 2001. With farm prices at a 25-year low, this income is critical to the survival of all family farms and the landscape of our entire Northeast region." During 2000, Agri-Mark also mailed more than $1.4 million in equity repayments to former members of the cooperative who retired from dairying or discontinued shipping milk to the cooperative. Equity is the money dairy farmers invest in their cooperative business during their years of membership. That money is returned in full, plus any retained profits, once the farmer stops shipping milk to Agri-Mark. Moving forward, Agri-Mark is a financially solid co-op prepared for the rollercoaster milk rides the dairy industry is known for, Peterson says. "Despite a difficult year on the farm in 2000, Agri-Mark has been able to provide farmers with an excellent milk market, and we are well positioned for a profitable future," Peterson says. - 30 -

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