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Dean Foods Declare Bankruptcy


RPM

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Dean Foods, America's largest milk producer, is filing for bankruptcy.

The 94-year-old company has struggled in recent years because Americans are drinking less cows milk. 2019 has been particularly brutal: the company's sales tumbled 7% in the first half of the year, and profit fell 14%. Dean Foods (DF) stock has lost 80% this year.


The company, which produces some of the country's most recognizable milk and dairy products, including Dairy Pure, Organic Valley and Land O'Lakes milks, has blamed its struggles on the "accelerated decline in the conventional white milk category."

The company is saddled with debt and has been unable to fund all of its workers' pensions. So on Tuesday, Dean Foods filed for Chapter 11 bankruptcy protection to keep the business operating, reorganize its debt and help fund the pensions while it looks to sell the company.

Dean Foods said in a statement that it is working with the Dairy Farmers of America cooperative on a potential deal, in which the cooperative would buy almost all of the company.
As part of the bankruptcy process, the company secured $850 million in financing from its existing lenders, including Rabobank (RSWLDD), to keep the company running.

The global market for milk alternatives is expected to top $18 billion this year, up 3.5% from 2018, according to Euromonitor. That's still a fraction of the traditional milk market which will come in at just under $120 billion globally this year.


Sales for cow's milk has been declining for the past four years. Sales for the past 52 weeks, ending on October 26, was around $12 billion, according to data Nielsen provided to CNN Business. That's a decline from $15 billion during a similar time period in 2015. All types of cow's milk, such as 1%, 2%, skim and fat-free milk sales have all declined.


In contrast, and while still much smaller, sales of oat milk has jumped 636% to $53 million over the past year.
That's not the only problem Dean Foods has faced. Walmart (WMT), which was one of Dean Food's biggest customers, dropped them last year after building its own dairy plant.

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Looks like I'm partially to blame for this. I started drinking Fa!rlife when it came on the market a couple years ago. It's ultra-filtered, ultra-pasteurized whole milk that has the lactose and excess water removed. Tastes great, lasts 3 months.

Fairlife-for-web.png?1488205846

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34 minutes ago, RPM said:

Looks like I'm partially to blame for this. I started drinking Fa!rlife when it came on the market a couple years ago. It's ultra-filtered, ultra-pasteurized whole milk that has the lactose and excess water removed. Tastes great, lasts 3 months.

Fairlife-for-web.png?1488205846

Gotta have real milk for coffee. Wife and I have been buying HEB's 2% Mootopia for years now. Same thing as Fairlife basically. Excess water and sugar all filtered out, lactose-free. Tastes great. Sell by date is typically 4-6 weeks away. Never gotten close to having it expire before finishing. 

Edited by Storm the Field
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42 minutes ago, RPM said:

Looks like I'm partially to blame for this. I started drinking Fa!rlife when it came on the market a couple years ago. It's ultra-filtered, ultra-pasteurized whole milk that has the lactose and excess water removed. Tastes great, lasts 3 months.

Fairlife-for-web.png?1488205846

 

My brain goes right to the "Insecurity" episode of South Park where the old man is telling a story. 

"you want that milk pasteurized?"

"no, just pour it on my boobs, i can splash it passed my eyes"

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There is nothing better than a cold glass of whole milk and a warm chocolate cookie.  Fight me.
Yes there is. A whole plate of chocolate chip cookies.

We go through 8 gallons a week and that's without my wife or I drinking it. I'm lactose intolerant now and she just doesn't like milk.
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