U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                   FORM 10-QSB

                                   ----------

(Mark One)

|X|   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2006


                                       OR

|_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

                       Commission file number: 333-111486


                             DAIRY FRESH FARMS INC.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

<TABLE>
<CAPTION>
<S>                                                               <C>
                    Nevada                                        98-0407549
 ----------------------------------------------      ------------------------------------
 (State or other jurisdiction of incorporation)      (I.R.S. Employer identification No.)
</TABLE>

             413 Churchill Avenue N. Ottawa, Ontario, Canada K1Z 5C7
             -------------------------------------------------------
                    (Address of principal executive offices)

                                Tel: 613-724-2484
                              --------------------
                           (Issuer's telephone number)

         Securities registered under Section 12(b) of the Exchange Act:
                                      None

         Securities registered under Section 12(g) of the Exchange Act:
                    Common Stock, $0.001 par value per share
                                (Title of Class)


Check whether the issuer: (i) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (ii) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|

As of June 21, 2006, there were 15,681,792 shares of the registrant's common
stock outstanding.

Transitional Small Business Disclosure Format (check one) Yes|_|  No|X|

Indicate by check mark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). Yes |_|; No |X|

<PAGE>

                             DAIRY FRESH FARMS INC.


<TABLE>
<CAPTION>
Part I.  Financial Information                                                    Page

<S>                                                                                <C>
Item 1.  Condensed Consolidated Financial Statements and Notes to Condensed
         Consolidated Financial Statements


      (a)   Condensed Consolidated Statements of Operations for the Three Months
            Ended March 31, 2006 and 2005 (unaudited)                              3

      (b)   Condensed Consolidated Statements of Cash Flows for the Three Months
            Ended March 31, 2006 and 2005 (unaudited)                              4

      (c)   Condensed Consolidated Balance Sheet as at March 31, 2006
            (unaudited) and December 31, 2005 (audited)                            5

      (d)   Notes to Condensed Consolidated Financial Statements (unaudited)       6


Item 2.  Management's  Discussion  and  Analysis  or Plan of Operations           11

Item 3.  Controls and Procedures                                                  18


Part II.  Other Information


Item 1.  Legal Proceedings                                                        19

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds              19

Item 3.  Defaults upon Senior Securities                                          19

Item 4.  Submission of Matters to a Vote of Security Holders                      19

Item 5.  Other Information                                                        19

Item 6.  Exhibits                                                                 19


Signatures                                                                        20
</TABLE>


                                       1
<PAGE>

PART I FINANCIAL INFORMATION

General

The accompanying condensed consolidated financial statements have been prepared
in accordance with the instructions to Form 10-QSB. Therefore, they do not
include all information and footnotes necessary for a complete presentation of
financial position, results of operations, cash flow, and stockholders' deficit
in conformity with generally accepted accounting principles in United States of
America. Except as disclosed herein, there has been no material change in the
information disclosed in the notes to the consolidated financial statements
included in the Company's annual report on Form 10-KSB for the year ended
December 31, 2005. In the opinion of management, all adjustments considered
necessary for a fair presentation of the results of operations and financial
position have been included and all such adjustments are of a normal recurring
nature. Operating results for the quarter ended March 31, 2006 are not
necessarily indicative of the results that can be expected for the year ending
December 31, 2006.


                                       2
<PAGE>

ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Dairy Fresh Farms Inc.
Condensed Consolidated Statements of Operations
Expressed in U.S. Dollars
================================================================================

<TABLE>
<CAPTION>
                                                          Three months    Three months
                                                                ended            ended
                                                       March 31, 2006   March 31, 2005
                                                           (Unaudited)      (Unaudited)
                                                           -----------    -----------
<S>                                                        <C>            <C>
                                                           $              $

Revenues                                                            --         27,265
                                                           -----------    -----------

Operating expenses
    Freight and product costs                                      233          1,432
    Advertising and product support                             15,033        169,169
    Depreciation of property and equipment                       1,001          1,085
    Finder's fee for reverse takeover transaction                   --        100,000
    Interest and bank charges, net                               2,537            919
    Management fees                                             91,376         97,855
    Office                                                       2,091          6,459
    Professional fees                                           32,806         31,944
    Rent                                                         4,018          4,166
    Telecommunications                                           4,322          2,928
    Travel                                                      24,563         23,239
                                                           -----------    -----------
                                                               177,980        439,196
                                                           -----------    -----------
Net loss                                                      (177,980)      (411,931)
                                                           ===========    ===========

Basic and diluted loss per share                           ($     0.01)   ($     0.04)
                                                           ===========    ===========
Weighted average number of shares outstanding, basic and
diluted                                                     15,658,748     10,779,889
                                                           ===========    ===========
</TABLE>

The accompanying notes are an integral part of the condensed consolidated
financial statements.


                                       3
<PAGE>

Dairy Fresh Farms Inc.
Condensed Consolidated Statements of Cash Flows
Expressed in U.S. Dollars
================================================================================

<TABLE>
<CAPTION>
                                                     Three months     Three months
                                                            ended            ended
                                                   March 31, 2006   March 31, 2005
                                                      (Unaudited)      (Unaudited)
                                                        --------        --------
<S>                                                 <C>              <C>
                                                    $               $
OPERATING ACTIVITIES
Net loss                                                (177,980)       (411,931)
Non-cash items:
    Depreciation of property and equipment                 1,001           1,085
    Finders fee for reverse takeover transaction              --         100,000
    Issuance of shares in exchange of services            26,250              --
    Changes in working capital items
       Accounts receivable                                (2,245)        (13,632)
       Prepaid expenses                                       --          13,896
       Accounts payable and accrued liabilities            9,455          47,332
       Management contracts payable                       93,116          22,425
                                                        --------        --------
Cash flows used in operating activities                  (50,403)       (240,825)
                                                        --------        --------


INVESTING ACTIVITIES
Purchase of property and equipment                            --         (10,093)
                                                        --------        --------
Cash flows used in investing activities                       --         (10,093)
                                                        --------        --------

FINANCING ACTIVITIES
Issuance of convertible debt                                  --         303,778
Proceeds from notes payable                               43,512              --
                                                        --------        --------
Cash flows provided by financing activities               43,512         303,778
                                                        --------        --------
Effect of changes in exchange rates on cash                 (328)            257
                                                        --------        --------
Net increase (decrease) in cash                           (7,219)         53,117
Cash, beginning of period                                 12,976          90,578
                                                        --------        --------
Cash, end of period                                        5,757         143,695
                                                        ========        ========

Non-cash financing transaction:
    Issuance of shares to settle accounts payable         13,010              --
</TABLE>


The accompanying notes are an integral part of the condensed consolidated
financial statements.


                                       4
<PAGE>

Dairy Fresh Farms Inc.
Condensed Consolidated Balance Sheets
Expressed in U.S. Dollars
================================================================================

<TABLE>
<CAPTION>
                                                                               March 31, 2006  December 31, 2005
                                                                                (Unaudited)      (Audited)
                                                                                 ----------      ----------
<S>                                                                              <C>             <C>
ASSETS
Current assets
    Cash                                                                              5,757          12,976
    Accounts receivable                                                              63,714          61,675
    Prepaid expenses                                                                    386             387
                                                                                 ----------      ----------
                                                                                     69,857          75,038

Property and equipment, net                                                          12,546          13,571
                                                                                 ----------      ----------
                                                                                     82,403          88,609
                                                                                 ==========      ==========

LIABILITIES
Current liabilities
    Accounts payable and accrued liabilities                                        356,133         360,903
    Management contracts payable                                                    591,031         500,704
    Notes payable                                                                    42,871              --
                                                                                 ----------      ----------
                                                                                    990,035         861,607
                                                                                 ----------      ----------

Commitments and Contingencies

SHAREHOLDERS' DEFICIENCY
Common shares, $0.001 par value, voting, 75,000,000 authorized shares,
15,681,792 shares issued and outstanding as of March 31, 2006 and 15,620,792
shares as at December 31, 2005                                                        2,377           2,316
Contributed surplus                                                               1,581,094       1,541,895
Accumulated other comprehensive loss                                               (103,536)       (107,622)
Accumulated deficit                                                              (2,387,567)     (2,209,587)
                                                                                 ----------      ----------
                                                                                   (907,632)       (772,998)
                                                                                 ----------      ----------
                                                                                     82,403          88,609
                                                                                 ==========      ==========
</TABLE>

The accompanying notes are an integral part of the condensed consolidated
financial statements.


                                       5
<PAGE>

Dairy Fresh Farms Inc.
Notes to Condensed Consolidated Financial Statements
March 31, 2006
Expressed in U.S. Dollars
(Unaudited)
================================================================================

1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Dairy
Fresh Farms Inc. ("Dairy Fresh" or the "Company") and its subsidiaries have been
prepared pursuant to the rules and regulations of the United States Securities
and Exchange Commission ("SEC"). Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles in the United States of America ("US GAAP") have
been condensed or omitted pursuant to such rules and regulations. These
condensed consolidated financial statements should be read in conjunction with
the financial statements and notes included in the latest annual report on Form
10-KSB. These statements have been prepared on the same basis as the audited
consolidated financial statements for the year ended December 31, 2005 and, in
the opinion of management, include all adjustments considered necessary for a
fair presentation of financial position, results of operations and cash flows of
the Company. The results of operations for the three months ended March 31, 2006
are not necessarily indicative of the results to be expected for the full year.

2 - COMPANY BACKGROUND AND LIQUIDITY

COMPANY BACKGROUND

The Company was incorporated under the name of Northwest Horizon Corporation in
the State of Nevada, United States of America on February 5, 2003. The name was
changed to Dairy Fresh Farms Inc. on August 11, 2005.

The Company was in the development stage until January 1, 2005. The Company
originally intended to establish itself as a transportation broker specializing
in trucking as the efficient mode of transporting both raw materials and
finished products to their destination, however as of December 17, 2004, the
Board of Directors passed a resolution indicating that the Company would be
unable to raise the necessary funds to proceed with this original plan.

On March 3, 2005, the Company merged via a reverse takeover with Dairy Fresh
Technologies Ltd. Dairy Fresh Technologies Ltd., was incorporated under the
Canada Business Corporations Act on May 14, 2002 to develop and exploit a unique
patented dairy process in Canada. This patent, "Dairy Fresh Farms (TM)" produces
monounsaturated-enhanced dairy products. Dairy Fresh Technologies Ltd. was also
in the development stage until January 1, 2005.


LIQUIDITY

The Company has incurred a net loss of $177,980 during the three months ended
March 31, 2006. In addition, the Company generated negative cash flows from
operations of $50,403 for the three months ended March 31, 2006 and has
generated negative cash flows from operations since inception.

                                       6
<PAGE>

Dairy Fresh Farms Inc.
Notes to Condensed Consolidated Financial Statements
March 31, 2006
Expressed in U.S. Dollars
(Unaudited)
================================================================================

The auditors' report on the Company's consolidated financial statements as of
December 31, 2005 states that the net loss incurred during the year ended
December 31, 2005, the accumulated deficit as of that date, and the other
factors described in Note 2 to the Consolidated Financial Statements included in
the Company's Annual Report on Form 10-KSB for the year ended December 31, 2005,
raise substantial doubt about the Company's ability to continue as a going
concern. The auditors' report on the Company's financial statements for the year
ended December 31, 2004 contained a similar statement. The consolidated
financial statements have been prepared assuming the Company will continue as a
going concern and do not include any adjustments that might result from the
outcome of this uncertainty.

Management plans to address these issues by continuing to seek new financing,
reducing expenses and renegotiating the repayment terms of its accounts payable
and accrued liabilities. The Company's cash flow projections plan for an equity
financing of $3.0 million during the second and third quarters of 2006. The
Company's ability to continue as a going concern is subject to management's
ability to successfully implement the above plans. Failure to implement these
plans could have a material adverse effect on the Company's position and/or
results of operations and may necessitate a reduction in operating activities.
These condensed consolidated financial statements do not include adjustments
that may be required if the assets are not realized and the liabilities settled
in the normal course of operations.

In the longer term, the Company has to generate the level of revenues which
would result in cash self sufficiency and it may need to continue to raise
capital by selling additional equity or by obtaining credit facilities. No
assurance can be given that any such additional funding will be available or
that, if available, it can be obtained on terms favorable to the Company.


                                       7
<PAGE>

Dairy Fresh Farms Inc.
Notes to Condensed Consolidated Financial Statements
March 31, 2006
Expressed in U.S. Dollars
(Unaudited)
================================================================================

3 - RELATED PARTY TRANSACTIONS

The Company entered into the following related party transactions. These
transactions were concluded in the normal course of operations at the exchange
amount, which is the amount established and accepted by the parties.

<TABLE>
<CAPTION>
                                                           Three months    Three months
                                                                  ended           ended
                                                         March 31, 2006  March 31, 2005
                                                            (Unaudited)     (Unaudited)
                                                         -------------   --------------
<S>                                                         <C>             <C>
                                                             $            $
Expenses
    Management fees (a)                                        91,376         97,855
Amounts due to and due from related parties
    Amount due from companies under common control (b)          9,794          1,646
    Notes payable to related party (c)                         25,722             --
    Amount due to a company under common control (d)
                                                                6,686             --
</TABLE>

(a) During the three-month periods ended March 31, 2006 and March 31, 2005, the
Company paid for management services to four companies controlled by officers of
the Company. The management fees payable are $591,031 as at March 31, 2006 and
$500,704 as at December 31, 2005.

 (b) The Company paid legal expenses for Dairy One Technologies Limited and
Purple Cow Investments Inc., companies under common control, during the year
ended December 31, 2005 and the three months ended March 31, 2006 resulting in
the above amount receivable from companies under common control. The legal fees
paid during the quarter ended March 31, 2006 and 2005 are $1,005 and $nil,
respectively.


                                       8
<PAGE>

Dairy Fresh Farms Inc.
Notes to Condensed Consolidated Financial Statements
March 31, 2006
Expressed in U.S. Dollars
(Unaudited)
================================================================================

(c ) The Company issued $25,722 of 5% promissory notes to an officer of the
Company during the three-month period ended March 31, 2006. The notes are
repayable when a major financing is completed.

(d) The Company incurred royalty expense to Dairy One Technologies Limited, a
company under common control, in the amount of $6,705 during the year ended
December 31, 2005. The amount payable as at March 31, 2006 is $6,686 (March 31,
2005 - nil). The Company expensed $nil in the three-month period ended March 31,
2006 and nil in the three-month period ended March 31, 2005.

4 - NOTES PAYABLE

Notes payable bear interest at 5%, unsecured and repayable when a major
financing is completed.

5 - LOSS PER SHARE

For the purpose of the loss per share computation, the weighted average number
of common shares outstanding has been used. Had the treasury stock method been
applied to the unexercised share warrants, the effect on the loss per share
would be anti-dilutive.

The total warrants outstanding at March 31, 2006 and March 31, 2005 were
2,220,792 and 977,500, respectively.

6 - SHAREHOLDERS' EQUITY

During the first quarter of 2006, 26,000 common shares were issued as payment
for professional fees incurred in the year ended December 31, 2005, valued at
$0.50 per share which represents the fair value of the Company's share when the
services were completed. The excess in the par value is recorded in contributed
surplus.

The Company  issued 35,000 common shares during the three months ended March 31,
2006 and nil shares for the three  months  ended March 31, 2005 in exchange  for
professional  fees  incurred.  The shares were valued at $0.75 per share,  which
represents  the fair  value  of the  Company's  share  when  the  services  were
completed. The excess of the par value is recorded in contributed surplus.


                                       9
<PAGE>

Dairy Fresh Farms Inc.
Notes to Condensed Consolidated Financial Statements
March 31, 2006
Expressed in U.S. Dollars
(Unaudited)
================================================================================

6 -COMPREHENSIVE LOSS

Comprehensive loss includes changes in the balances of items that are reported
directly in a separate component of shareholders' equity in the Company's
unaudited condensed consolidated balance sheets. The components of comprehensive
loss are as follows:

                                     Three months ended    Three months ended
                                         March 31, 2006        March 31, 2005
                                            (Unaudited)           (Unaudited)
                                     -----------------      ----------------
                                             $                  $
Net loss as reported                          (177,980)             (411,931)
Foreign currency translation adjustment          4,086                (2,424)
                                              --------              --------
Comprehensive loss                            (173,894)             (414,355)
                                              ========              ========


                                       10
<PAGE>

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS


This Management's Discussion and Analysis of Financial Condition and Results of
Operation contains various "forward looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934 and Section 27A of the
Securities Act of 1933, regarding future events or the future financial
performance of the Company that involve risks and uncertainties. Certain
statements included in this Form 10-QSB, including, without limitation,
statements related to anticipated cash flow sources and uses, and words
including but not limited to "anticipates", "believes", "plans", "expects",
"future" and similar statements or expressions, identify forward looking
statements. Any forward looking statements herein are subject to certain risks
and uncertainties in the Company's business, including but not limited to,
reliance on key customers and competition in its markets, market demand, product
performance, technological developments, maintenance of relationships with key
suppliers, difficulties of hiring or retaining key personnel and any changes in
current accounting rules, all of which may be beyond the control of the Company.
The Company's actual results could differ materially from those anticipated in
these forward looking statements as a result of certain factors, including those
set forth therein.

Management's Discussion and Analysis of Financial Condition and Results of
Operations ("MD&A") should be read in conjunction with the consolidated
condensed financial statements included herein. Further, this quarterly report
on Form 10-QSB should be read in conjunction with the Company's consolidated
financial statements and notes to consolidated financial statements included in
its 2005 Annual Report on Form 10-KSB. In addition, you are urged to read this
report in conjunction with the risk factors described herein.

BACKGROUND

This discussion and analysis of financial position and results of operations is
prepared as at March 31, 2006 and should be read in conjunction with the
condensed consolidated financial statements for the quarter ended March 31,
2006. These condensed consolidated financial statements have been prepared using
the generally accepted accounting principles in the United States of America on
the same basis as the audited consolidated financial statements for the year
ended December 31, 2005 and, in the opinion of management, include all
adjustments considered necessary for a fair presentation of financial position,
results of operations and cash flows of the Company.


Company's overview

Dairy Fresh Farms Inc. ("Dairy Fresh" or the "Company") and its wholly owned
subsidiary, Dairy Fresh Technologies Ltd., have the exclusive license in Canada
to develop and exploit the patented formula for a healthy milk based product
"Dairy Fresh Farms". The Company launched a test trial of 2-litre regular milk
and a 1-litre lactose free product with Canada Safeway stores in Western Canada
during the period of January 2005 to December 2005.

                                       11
<PAGE>

The Company will launch an expanded product line and in Ultra High Temperature
(UHT) format when planned financing as discussed under "Liquidity and Capital
Resources" is completed. Consequently there were no revenues in the quarter
ended March 31, 2006.

Dairy Fresh Farms is an all natural process resulting in a healthier milk based
product which is low in cholesterol, trans fat free, lactose free, low in
saturated fat, 99% fat free and has high levels of omega 6 and 3 and
monounsaturated fat enhanced without compromising great taste.

Critical accounting policies and estimates

Our discussion and analysis of our financial condition and results of operations
are based on our condensed consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States of America. The preparation of financial statements requires
application of management's subjective judgments, often requiring the need to
make estimates about the effect of matters that are inherently uncertain and may
change in the subsequent periods. Our actual results may differ substantially
from these estimates under different assumptions or conditions. While our
significant accounting policies are described in more detail in the notes to the
condensed consolidated financial statements included in the Form 10KSB for the
year ended December 31, 2005, we believe that the following accounting policies
require the application of significant judgments and estimates.

Going concern

The consolidated financial statements have been prepared on the going concern
basis, which assumes the realization of assets and liquidation of liabilities in
the normal course of operations.

If the Company was not to continue as a going concern, it would likely not be
able to realize its assets at values comparable to the carrying values reflected
in the condensed consolidated financial statements. As described elsewhere in
this report, at March 31, 2006, there are certain conditions that currently
exist which raise substantial doubt about the validity of this assumption. While
the Company anticipates raising additional private placement funds to remove the
substantial doubt, these private placements are not assured. Failure to raise
additional funds may result in the Company curtailing operations or writing
assets and liabilities down to liquidation values, or both.

Revenue recognition

The Company had entered into a co-packing agreement with a supplier. Under the
terms of this agreement, the supplier manufactures the dairy products per the
specifications and instructions of the Company and ships directly to the
retailer. The supplier invoices and collects directly from the retailer. The
supplier subtracts its manufacturing cost and markup, as well as freight and
submits the net amount to the Company.

                                       12
<PAGE>

The Company records the revenue on a net basis in compliance with EITF 99-19,
"Reporting Revenues Gross as a Principle versus Net as an Agent". This is
because the Company is not the primary obligor in the arrangement, as it relies
on the supplier to provide the goods. Also, the Company has limited liability to
assume risk of non-payment by its retailers.

The Company also records its revenue in accordance with SAB 104 which requires
that four basic criteria must be met before revenue can be recognized (i)
persuasive evidence of an arrangement exists; (ii) delivery has occurred or
service has been rendered; (iii) the fee is fixed and determinable; and (iv)
collectibility is reasonably assured.

The Company recognizes revenue when the product is shipped from the supplier.

Stock based compensation

The Company has not implemented a stock option based compensation plan at this
time. There are plans to introduce an option plan in the third quarter of 2006.

Plan of operation

The plan of operation for the Company was developed over a three-year period.
Management started by studying the Australian experience as it related to the
Canadian marketplace. Significant sales numbers had been delivered out of
Sydney, Australia but with both market changes and potential differing Canadian
tastes management decided to take another approach to tackling the Canadian
market. Camelford Graham Research Group undertook an independent market research
study. This study was conducted in Vancouver, British Columbia and Montreal,
Quebec. The results from the study were published in December 2003 with
resulting findings focusing our operations on several very important areas.

Firstly, the size of the opportunity was much larger than originally anticipated
due to the intent to purchase numbers that resulted from this study. This meant
that management had to revise the packing sizes for the Dairy Fresh Farms
upwards to accommodate the anticipated demand.

Secondly, the study directed management to launch in Western Canada as a first
step into the rest of the country. It was perceived that the logistics and more
importantly the market reception would be very favorable with a product launch
in the West. This decision was also reinforced with the effort and support that
Canada Safeway stores and their manufacturing division Lucerne Foods gave our
group with initial manufacturing test runs and distribution expertise.

Finally, it was felt that perfecting the launch strategy in Western Canada would
give Dairy Fresh Farms a strong base of operations prior to moving into the much
larger and diverse markets of both Ontario and Quebec.

The most significant conclusion from our test launch with Canada Safeway/Lucerne
was the need to produce the product in Ultra High Temperature (UHT) format,
which will provide extended shelf life to approximately 45 days. This is
necessary to build brand awareness with the customers during the early stages of
growth and allow sufficient distribution time, as the product is rolled out to
other retailers. Otherwise the Company would need to spend excessive amounts on
marketing and in store demos in order to move the product on a timely basis.

                                       13
<PAGE>

We finished our test launch in December 2005. When financing is completed, we
will resume our production and distribution plan for Western Canada and the rest
of Canada.

Assuming our funding is raised, we intend to focus our sales and marketing
efforts over the next 12 months primarily on expanding our distribution and
retail share in the rest of the Canadian market place. In such event, if we are
unable to raise additional funds on a timely basis or at all, any progress with
respect our products and, therefore, our potential revenues would be adversely
affected.

RESULTS OF OPERATIONS

Fluctuations in operating results

Our results of operations have fluctuated significantly from period to period
and are likely to continue to do so in the future. We anticipate that our annual
results of operations will be impacted for the foreseeable future by several
factors including the progress and timing of expenditures related to product
launches. Due to these fluctuations, we believe that the period-to-period
comparisons of our operating results are not a good indication of our future
performance.

Revenues

The Company's two-litre regular milk product was listed with 134 Canada Safeway
stores and the one litre lactose free product was listed with all 204 Safeway
stores on January 12, 2005 and ended on December 10, 2005. These stores are all
located in the western provinces. As a result of the trial period ending there
were no sales in the quarter ended March 31, 2006.

OPERATING EXPENSES

Advertising and product support

With the launch of the Company's initial two products there was a marketing
program established to support sales in the quarter ended March 31, 2005. The
majority of the focus was on in-store demos. There were some close out costs
from the product launch in the form of late coupon redemptions from some stores
in the current quarter, however with the products off the shelves there was
little in the way of spending in this area for the quarter ended March 31, 2006.

                                       14
<PAGE>

Management fees

Management fees approximated the previous quarter with no changes to the
management structure. The decline was due to currency fluctuations with the
contracts fixed in Canadian dollars.

Professional fees

Professional fees are comparable to the previous quarter and reflect legal,
accounting and professional services for a public company.

Travel

Travel costs were consistent at $24,563 for the quarter ended March 31, 2006
compared to $23,239 for the previous quarter. Travel costs reflect senior
management maintaining a presence for financing and business activity in Western
Canada. The travel costs relate to the launches of the Company's products in
Western Canada.


Finder's fee

As part of the reverse takeover transaction during the quarter ended March 31,
2005, the Company issued 1,500,000 fully paid common shares as a finder's fee to
the Company's advisor.


Off-Balance Sheet Arrangements

The Company did not engage in any off-balance sheet arrangements during the
quarter.


                                       15
<PAGE>


Liquidity and Capital Resources

At March 31, 2006, we had a deficit accumulated of approximately $2,388,000 and
we expect to incur additional losses in the short term at least until such time,
if ever, that our products are manufactured and marketed profitably. We have
financed our operations since inception primarily through the private placements
of equity and debt securities. From our inception through March 31, 2006, we
have received net proceeds of approximately $1,010,000 from private sales of our
convertible debentures, which have been converted to common stock. We have been
able to reduce our cash requirements with the deferral of management contracts
of approximately $591,000. The payment terms have not been defined for these
management contracts.

At March 31, 2006, we had approximately $6,000 in cash. Net cash used in
operating activities was approximately $50,000 for the quarter ended March 31,
2006 compared to approximately $241,000 for the quarter ended March 31, 2005.
The decrease in net cash used in operations during the quarter ended March 31,
2006 was primarily due to lower net loss incurred during the quarter ended March
31, 2006, and a deferral of current liabilities and management contracts
payable.

Net cash provided by financing activities was approximately $44,000 for the
quarter ended March 31, 2006 compared to approximately $304,000 for the quarter
ending March 31, 2005. The net cash provided by financing activities in the
quarter ended March 31, 2006 was primarily due to the net proceeds of
approximately $42,000 raised in a private note payable.

We expect to put our current capital resources to the following uses:

      -     for the marketing and sales of our products;
      -     to continue our product line expansion;

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<PAGE>

      -     for working capital purposes,  including for additional salaries and
            wages as our organization grows and as we expand our presence in the
            Canadian  Market and for additional  professional  fees and expenses
            and other operating costs.

Our cash flow projections plan for an equity financing of $3.0 million during
the second and third quarters of 2006. We will continue to rely on private
funding.

Assuming our funding is raised, we intend to focus our sales and marketing
efforts over the next twelve months on expanding our distribution and retail
share in the rest of the Canadian marketplace. In such event, if we are unable
to raise additional funds on a timely basis or at all, any progress with respect
to our products and, therefore, our potential revenues, would be adversely
affected.

In the event that our plans change, our assumptions change or prove inaccurate,
or if our existing cash resources, together with other funding resources
including anticipated sales of our products, otherwise prove to be insufficient
to fund our operations, we could be required to seek additional financing. We
have no current arrangements with respect to sources of additional financing.

The auditors' report on the Company's consolidated financial statements as of
December 31, 2005 states that the net loss incurred during the year ended
December 31, 2005, the accumulated deficit as of that date, and the other
factors described in Note 2 to the Consolidated Financial Statements included in
the Company's Annual Report on Form 10-KSB for the year ended December 31, 2005,
raise substantial doubt about the Company's ability to continue as a going
concern. The auditors' report on the Company's financial statements for the year
ended December 31, 2004 contained a similar statement. The consolidated
financial statements have been prepared assuming the Company will continue as a
going concern and do not include any adjustments that might result from the
outcome of this uncertainty.

Risks Related to Our Company

We have not been profitable since our inception in 2003. As of March 31, 2006,
we had an accumulated deficit of approximately $2,388,000 primarily as a result
of our start up expenses. We may never realize sufficient revenues from the sale
of our products or be profitable. Each of the following factors, among others,
may influence the timing and extent of our profitability, if any:

      -     the  completion  and success of financing to provide  marketing  and
            administration support for the launch of our product;
      -     the  market  acceptance  of Dairy  Fresh  Farms  with  the  Canadian
            Consumer;
      -     our ability to effectively and efficiently  manufacture,  market and
            distribute  our products;  and
      -     our ability to sell our products at competitive  prices which exceed
            our per unit costs.

We anticipate that, if cash generated from operations is insufficient to satisfy
our requirements, we will require additional funding to continue to market our
products. Our cash flow projections plan for an equity financing of $3.0 million
during the second and third quarters of 2006. We will continue to rely on
private funding. However, our projections of future cash needs and cash flows
may differ from actual results.

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<PAGE>

Our plan to sell additional equity securities or convertible debt could result
in dilution to our stockholders. We can give no assurance that we will be able
to generate adequate funds from operations, that funds will be available to us
from debt or equity financing or that, if available, we will be able to obtain
such funds on favorable terms and conditions. We currently have no arrangements
with respect to additional financing. If we cannot obtain such funds if needed,
we would need to curtail or cease some or all of our operations.


ITEM 3. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation
of our management, including our Chief Executive Officer and Principal Financial
and Accounting Officer, of the effectiveness of our disclosure controls and
procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities
Exchange Act of 1934 as of the end of the period covered by this report. Based
on that evaluation, our Chief Executive Officer and Principal Financial Officer
have concluded that our disclosure controls and procedures as of March 31, 2006
were not effective due to the material weakness in our internal controls over
financial reporting described below, and other factors related to the Company's
financial reporting processes and information technology security protocols.

As disclosed in the Company's Form 10-KSB for the year ended December 31, 2005,
both the Company and its independent registered public accounting firm
identified certain significant internal control deficiencies that we considered
to be, in the aggregate, a material weakness. The primary concern was the
adequacy of review of supporting schedules that result in adjusting journal
entries being entered into the accounting systems that were inaccurate or
disclosures in the notes to the financial statements that were incorrect or
inadequate. These inaccuracies were not detected by the control procedures of
management reviewing the schedules and supporting documentation, resulting in
errors appearing on the financial statements and subsequent detection in the
audit. The other area of concern was the inadequate segregation of duties among
the administrative staff. Due to the size of our Company and the costs to
remediate these issues, we still consider these concerns to be relevant.

Changes in Internal Controls

There have been no material changes in our internal controls over financial
reporting or in other factors that could materially affect, or are reasonably
likely to affect, our internal controls over financial reporting during the
quarter ended March 31, 2006.


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                            PART II OTHER INFORMATION


Item 1.  Legal Proceedings

         Not applicable

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

During the first quarter of 2006, 26,000 common shares were issued as payment
for professional fees incurred in the year ended December 31, 2005, valued at
$0.50 per share which represent the fair value of the Company's share when the
services were completed.. The excess in the par value is recorded in contributed
surplus.

The Company  issued 35,000 common shares during the three months ended March 31,
2006 and NIL shares for the three  months  ended March 31, 2005 in exchange  for
professional  fees  incurred.  The shares  were  valued at $0.75 per share which
represents  the fair  value  of the  Company's  share  when  the  services  were
completed. The excess of the par value is recorded in contributed surplus.

Item 3.  Defaults Upon Senior Securities

      Not applicable

Item 4.  Submission of Matters to a Vote of Security Holders

      None.

Item 5.  Other Information

      None.

Item 6.  Exhibits

      A. Exhibits:

      31.1  Certification of Chief Executive  Officer Pursuant to Section 302 of
            the Sarbanes-Oxley Act.

      31.2  Certification of Principal Financial and Accounting Officer Pursuant
            to Section 302 of the Sarbanes-Oxley Act.

      32.1  Certification of Chief Executive  Officer Pursuant to Section 906 of
            the Sarbanes-Oxley Act.

      32.2  Certification  of  Principal   Financial  and  Accounting   Officer)
            Pursuant to Section 906 of the Sarbanes-Oxley Act.


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                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(b) of the Securities Exchange
Act of 1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of Ottawa, Canada.

                                  DAIRY FRESH FARMS INC.



                                  By   /s/Robert Harrison
                                    --------------------------------------------
                                  Robert Harrison
                                  Chief Executive Officer


    Date:  June 21, 2006


                                  By  /s/ Don Paterson
                                     -------------------------------------------
                                  Don Paterson
                                  Principal Financial and Accounting Officer

    Date:  June 21, 2006


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