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E i I tEconomic Impactof the California Dairy Business
Prepared for
California Milk Advisory Board
Milk Advisory BoardThe Wow of the Cow
Jerry DryerJerry DryerJ/D/G Consulting Inc
02 Dec 2009
Economic Impact of DairyEconomic Impact of Dairy• Milk producers and dairy processors generate billions of
d ll f i ti it d t th d f j bdollars of economic activity and create thousands of jobs– Producing milk
– Jobs and inputs to build and operate milk production facility– Moving the milk to plantsMoving the milk to plants– Processing the milk into consumable products– Moving the dairy products to market
• Warehousing, distribution• Other food manufacturers• Exports
– Out-of-state– International
– Delivering products to consumers• Retail• Foodservice
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Economic Impact of DairyEconomic Impact of Dairy
• Milk Production– Value of milk– Jobs created at the dairy– Economic ImpactEconomic Impact– Household Earnings– Jobs Created beyond the farm gate
Milk P i• Milk Processing– Value of products produced– Jobs created in the plantp– Economic Impact– Household Earnings
Jobs Created beyond the plant– Jobs Created beyond the plant
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Economic Impact of DairyEconomic Impact of Dairy
• Putting the Economic Impact in perspectivePutting the Economic Impact in perspective– Examine dairy business growth
• Review growthReview growth– Benchmarks: 1998 thru 2008– Gains since the previous analyses: 2004, 2007, 2008
– Detail how this Economic Impact moves through communities
– Supports the total economy of the State of California and beyond
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Basis of the AnalysisBasis of the Analysis• How much was produced?p• How many employees were needed?• What was the value of the finished products?• Data sources include:
– California Department of Food & AgricultureC lif i E l t D l t D t t– California Employment Development Department
– US Department of Agriculture– US Bureau of Economic AnalysisUS u eau o co o c a ys s– US Census Bureau
– Census of ManufacturersEconomic Census– Economic Census
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The Wow of the CowThe Wow of the Cow• Milk production trend linesMilk production trend lines
– Milk cow numbersProduction per cow– Production per cow
– Total productionProduction per dairy– Production per dairy
– Other milk production detail
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The Wow of the CowThe Wow of the CowMilk Cows in Herd
1,800,000
2,000,000
1,200,000
1,400,000
1,600,000
,800,000
600,000
800,000
1,000,000
0
200,000
400,000
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the CowProduction Per Cow
22,500
(Pounds)
20 500
21,000
21,500
22,000
19,000
19,500
20,000
20,500
17,500
18,000
18,500
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the CowTotal Milk Production
45.000
(Billions of Lbs)
30.000
35.000
40.000
15.000
20.000
25.000
0.000
5.000
10.000
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the CowCalifornia Dairies
2,500
1,500
2,000
1,000
0
500
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the CowMilk per Dairy
25,000,000
y
15,000,000
20,000,000
10,000,000
0
5,000,000
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the Cow
40
Annual Average Milk Price
$18.00
$20.00
$14.
88
$14.
76 $17.
56
$16.
17
$14.
99
$15.
90 $19.
16
$18.
4
g
$10 00
$12.00
$14.00
$16.00
$4.00
$6.00
$8.00
$10.00
$0.00
$2.00
1998 2004 2007 2008
CA M ilb P i USA
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CA Mailbox Price USA
The Wow of the CowThe Wow of the CowValue of Milk Marketed
$10.00
(Billions of Dollars)
$6 00
$7.00
$8.00
$9.00
$3.00
$4.00
$5.00
$6.00
$0.00
$1.00
$2.00
1998 2004 2007 2008
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1998 2004 2007 2008
The Wow of the CowThe Wow of the CowEconomic Impact of Dairies
$17.0
(Billions of Dollars)
$13.0
$15.0
$9.0
$11.0
$5.0
$7.0
2004 2007 2008
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2004 2007 2008
The Wow of the CowThe Wow of the Cow
Wagesto Employeep y
Groceries, Clothes, G li Pi k T kGasoline, Pickup Truck
Retail Clerks Distributors WarehouseRetail Clerks, Distributors, Warehouse Staff, Food Manufacturers, Truckers,
Packaging Designers, Cotton Farmers, Oil Companies Auto WorkersOil Companies, Auto Workers
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The Wow of the CowThe Wow of the CowAdditional Household Earnings
$3.7
g(Billions of Dollars)
$3.4
$3.5
$3.6
$3.1
$3.2
$3.3
$2.8
$2.9
$3.0
2004 2007 2008
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2004 2007 2008
The Wow of the CowThe Wow of the CowJobs Created By Dairies
180,000
y
140,000
160,000
80,000
100,000
120,000
40,000
60,000
,
2004 2007 2008
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2004 2007 2008
The Wow of the CowThe Wow of the CowIn 2008 Typical California DairyIn 2008, Typical California Dairy
◊Generated $33.1 million worth of economic activity
◊ Generated $6.4 million of additional household earnings for California families
◊ Created 232 jobs in the statej◊ On-the-farm: 10
◊ Beyond the farm: 222◊ Beyond the farm: 222
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The Wow of the CowThe Wow of the CowTypical California Cow in 2008Typical California Cow in 2008
◊Generated $34,165 of economic activityG t d $6 616 f dditi l h h ld◊ Generated $6,616 of additional household
earnings for California families◊ Every 4 cows created a job in the state
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Impact of Dairy ProcessorsImpact of Dairy Processors
Fluid Milk Production
800,000,000746,409,355
754,331,160 760,685,240 770,158,618
(Gallons)
700,000,000
750,000,000
, ,
600,000,000
650,000,000
500,000,000
550,000,000
1998 2004 2007 2008
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1998 2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Frozen Desserts
180,000,000
159,246,503 154,095,600 158,921,167 164,967,632
(Gallons)
120,000,000
140,000,000
160,000,000
60,000,000
80,000,000
100,000,000
0
20,000,000
40,000,000
1998 2004 2007 2008
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1998 2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Butter Production
600,000,000498,947,813
555,501,197
(Pounds)
400,000,000
500,000,000
312,750,181
385,968,611
200,000,000
300,000,000
0
100,000,000
1998 2004 2007 2008
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1998 2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Dry Product Production
1,400,000,0001,270,404,413 1,325,992,827
1,377,356,005
y(Pounds)
1,000,000,000
1,200,000,000
400,000,000
600,000,000
800,000,000 580,750,106
0
200,000,000
400,000,000
1998 2004 2007 2008
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1998 2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Cheese Production
2,500,000,000 1,992,818,3412,285,714,005
2,109,554,690
1,500,000,000
2,000,000,000
1,254,795,160
500,000,000
1,000,000,000
01998 2004 2007 2008
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Economic Impact by SectorEconomic Impact by Sector
Economic Impact by Sector
$18.00
$20.00
y(Billions of Dollars)
$12.00
$14.00
$16.00
$4.00
$6.00
$8.00
$10.00
$0.00
$2.00
$
Butter Frozen Dried Cheese Dairies Fresh
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2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Economic Impact of Dairy Plants
$50.0
y(Billions of Dollars)
$35.0
$40.0
$45.0
$15.0
$20.0
$25.0
$30.0
$0.0
$5.0
$10.0
$15.0
2004 2007 2008
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2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Household Earnings Generated by Dairy Plants(Billions of Dollars)
$6 0
$7.0
$8.0
$9.0
$3.0
$4.0
$5.0
$6.0
$0.0
$1.0
$2.0
2004 2007 2008
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2004 2007 2008
Impact of Dairy ProcessorsImpact of Dairy Processors
Jobs Created by Dairy Plants
300,000
y y
200,000
250,000
100,000
150,000
0
50,000
2004 2007 2008
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2004 2007 2008
Impact of Dairies & PlantsImpact of Dairies & Plants
Economic Output: $63 0 billionEconomic Output: $63.0 billionHousehold Earnings: $12.2 billionJ b C t dJobs Created:
35,045 directly employedy p y408,529 due to economic output443 574 California jobs443,574 California jobs
About 3% of the jobs in the state
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EconoYoumic Impactof California Dairy Business
The Wow of the CowPrepared for California Milk Advisory Board
By Jerry Dryer, J/D/G Consulting Inc02 Dec 2009
The Positive Economic Impact of California’s Dairy Industry Within the State
10 On-the-FarmJobs Lead to
222 Beyond-the-Farm
Jobs
O
Every 4 Dairy Cows = 1 Job
CheesePlant Workers
MilkProcessors
Feed Farmers
Milk Truck Drivers
Distributors
Processors
Grocery StoreClerks
Source: California Milk Advisory Board
Economic Output: $63 BILLION
California Job Creation Comparison
Film & TV (2007)208,230
Dairy (2008)443,574
Wine (2008)330,000
Retailers
A Typical Dairy Cow in 2008 Generated $34,165 of Economic Activity