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MOU will lead to funding for dairy sustainability projects

Tom Gallagher Published on 01 May 2010

In December 2009 the Innovation Center for U.S. Dairy signed a Memorandum of Understanding (MOU) with the USDA that provides the dairy industry, including producers, with access to funds for innovative projects related to sustainability.

The MOU recognizes the dairy industry for its past and present contributions as good stewards of the environment. In fact, according to a 2009 study by Cornell University, over the past 60 years, U.S. dairy has reduced the carbon footprint for its products by 63 percent, thanks to production efficiencies, nutrition management and other improvements.



What the MOU is, and importantly, what it is not, has been the subject of concern to some within the dairy industry. The purpose of this communication is to clarify the matter.

The agreement provides dairy organizations and farmers with access to funds for sustainability projects that the entire industry has been actively working on for more than two years. More than 420 people – producers and representatives of brands, dairy cooperatives, dairy associations, other interested organizations – have been working on 12 projects that will return an economic benefit to dairy, improve innovation in the marketing chain and reduce greenhouse gas emissions.

The agreement is between USDA and the Innovation Center for U.S. Dairy. The agreement is not between USDA and DMI, or any other checkoff group. The Innovation Center was formed in 2008 to bring the entire dairy value chain together on areas where working together could benefit all of us. The Innovation Center has 30 board members who are either CEOs or chairmen of cooperatives, processors, manufacturers and trade associations. The Board has five committees with more than 470 representatives from 150 companies voluntarily (paid by their own companies) working on these committees.

The agreement is not an endorsement of cap and trade, climate change or any other type of legislation, regulation or political philosophy. Much of the concern over what is really a very simple and positive agreement for the industry is based on understandable concerns related to the potential of climate change legislation or regulation. Here are a few points about these concerns:

• Whether or not the phrase “climate change” had ever been created, whether or not a climate change “movement” among some had begun, the sustainability projects the industry has been working on for over two years make good business sense for the industry and for dairy producers – both large and small. They are aimed at reducing costs, increasing revenue sources and giving us another marketing advantage with consumers.


• We need to, and did, ask ourselves this: Is the industry better off having a track record of working collectively to make use of USDA funds on projects that we defined ourselves to benefit dairy, or are we better off doing nothing? Should the potential for legislation or regulation that is unrelated to the projects we are working on – projects that will benefit dairy – prevent us from accessing USDA funds?

The Innovation Center set a 25 percent carbon reduction goal for 2020. This goal was self-identified and will be self-monitored and self-evaluated. This goal and monitoring is not part of the MOU with USDA. The goal was set one year prior to the agreement with USDA and was widely reported in magazines, newsletters, industry meetings and through other communications. If this self-set goal caught you by surprise at the time of the MOU signing, you should contact Jan Temple at (847) 627-3270 so that you can receive ongoing information from the Innovation Center.

Rather than being defensive on this issue, our industry has a great story to tell, and it’s one that consumers are not hearing enough about. Our opponents are urging consumers to eliminate milk, cheese and meat from their diets in order to “save the planet.” Consumers need to hear that America’s dairy farmers are helping to save the planet by producing an abundant supply of nutrient-rich dairy products in a sustainable way.

Given that the MOU was signed in Copenhagen at the time of the Climate Conference, it is logical that some dairy people may misunderstand the purpose of the agreement. But now that the facts are clear, should we be extremely happy if this agreement leads to USDA funding for projects we have been working on to benefit dairy? Yes. And when these projects are funded and they lead to positive results for dairy, while reducing carbon emissions at the same time, will we make consumer news out of that? Absolutely. PD

Tom Gallagher
  • Tom Gallagher

  • Chief Executive Officer
  • Innovation Center for U.S. Dairy
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