Global Scale

Written by Emily Battmer

Senestraro says the committee meetings bring DFA management and Board members together to focus on global trade — something he says is vital for a U.S. dairy company that has relatively little experience in the international market.

“We’re learning,” he says. “We’re relatively new in the marketplace, and we have to be a little more deliberate in our approach to global trade than we might need to be if we had been doing this for a long time.”

Already in the past 10 years, Senestraro says DFA has learned a lot about exports, and has shifted its strategy to focus more on global trade. Previously, DFA was not closely involved with moving surplus product, like whey powder and nonfat dry milk (NFDM).

Now, the Cooperative has taken on most of those sales itself, working to sell NFDM and whey directly instead of letting a third-party handle exports.

“We have people on the ground now making sales,” Senestraro says. “Our strategy is to leverage our relationships with customers who already have a global presence and piggyback on what they’re doing to make more sales overseas.”

Senestraro says the creation of the Fallon plant is an example of this more intentional approach. Global trade has moved from being an afterthought to a priority for DFA, and Senestraro says he expects our commitment to global trade to continue to grow.

As the Cooperative continues to build its export business over the next five to 10 years, Senestraro says he anticipates some volatility. Overall, though, the long-term outlook is optimistic.
“We’re a long-term player,” he says. “Our producers are multi-generational farmers and long-term thinkers, and we understand that we’re going to go through some rough spots, but we’re in it for the long haul. We’re going to stick it out.”

Levitt shares Senestraro’s optimism. However, he says global trade is cyclical and world markets are currently weak, creating a challenging situation for the U.S. dairy industry.

“We had really strong prices two years ago. Everyone overproduced, and now we’re seeing the backlash of that,” he says. “For the United States, our exports have increased 10 of the past 11 years. This year, they’ll be down.”

Still, Levitt says the fundamental drivers of global demand — rising populations and rising consumer incomes — are intact, and if the U.S. dairy industry can ride it out until conditions improve, the long-term result will be continued growth in the global market.

“I’m encouraged that U.S. exporters are hanging in there and not walking away from the export market,” Levitt says. “At some point, the markets will turn around, and the U.S. dairy industry will be there like it has been.”