The good year in Dairy Foods was driven by cost reductions in terms of operations and inventory management; improved product margins; strong volumes across most product lines—including record volumes in butter and in Foodservice—and aggressive management of the business portfolio.

Land O'Lakes is well on its way to positioning the business to compete and win over the long-term—through innovation in the way it does business and through new products.

One of the new products launched in 2000 was Ultra Creamy Butter, which contains more butterfat than regular butter. Initial results indicate the product is performing well in the gourmet, upscale foods marketplace.

Looking to the future, Land O'Lakes strategies in Dairy Foods are focused on adding optimal value to member production. These strategies include: A commitment to operational excellence and least-cost production; investing in and strengthening the Dairy Foods infrastructure across the membership area; building the core butter and cheese businesses; taking advantage of new technologies—such as e-business through vehicles like dairy.com—and leveraging the LAND O LAKES brand name into new, high-potential geographies, markets and products.