Archive for Dairy Industry – Page 2

Whole Milk Ready for Breakthrough Year

With consumer choice scientific research and congressional legislation all going its way, 2024 promises to be a breakthrough year for whole milk, NMPF’s Head of Nutrition Policy Claudia Larson and Regulatory Affairs Director Miquela Hanselman said in a Dairy Defined Podcast released today.

The variety that shoppers prefer is poised to return to school lunch menus given the bipartisan approval of the Whole Milk for Healthy Kids Act in the House of Representatives, and it will figure prominently in consideration for updated federal Dietary Guidelines that are due next year.

“This is important to our students, this is important to our schools, this is important to our parents,” said Larson, a senior director of government relations at NMPF. “Reach out to your senators, let them know that this is important to you and your children in your community and ask them to please co-sponsor the bill.”

NMPF has a call to action urging lawmakers to support the Whole Milk for Healthy Kids Act here. The full podcast is here. You can also find the podcast on Apple Podcasts, Spotify and Google Podcasts. Broadcast outlets may use the MP3 file below. Please attribute information to NMPF.

Transcript

Alan Bjerga: Hello and welcome to the Dairy Defined Podcast.

With consumer choice scientific research and congressional legislation all going its way, 2024 promises to be a breakthrough year for whole milk. The variety that shoppers prefer most is also poised to return to school lunch menus given the bipartisan approval of the Whole Milk for Healthy Kids Act in the House of Representatives, and it will figure prominently in consideration for updated federal Dietary Guidelines that are due next year. Joining us is NMPF’s Nutrition Policy Czar, Claudia Larson, and Regulatory Affairs Director Miquela Hanselman, who is our lead on the Dietary Guidelines. Hello, Miquela and Claudia.

Claudia Larson: Hi, Alan.

Miquela Hanselman: Hi Alan. Thanks for having us today.

Alan Bjerga: I want to start with you, Claudia. Just to temper things a bit, we’ve all been excited about the Whole Milk for Healthy Kids Act, but it isn’t yet law. Tell us what’s happened and what you’re trying to make happen this year.

Claudia Larson: So most recently, the Whole Milk for Healthy Kids Act passed through the US House of Representatives with what we would call a commanding bipartisan vote, demonstrating widespread support in the US House, both in the Republican and Democratic parties to return 2% and whole milk as good options in our school meal programs. Since the passage of that bill, all eyes are on the Senate now to see if the Senate’s either going to pick up the House’s version or move their own version of the bill, which itself has bipartisan support, including an independent senator co-sponsoring the bill.

So we are looking to the Senate to see if they will pick up and move that bill. Currently, we are looking to build even more bipartisan support for that bill to really demonstrate to the Senate that there is not only bipartisan support on the House side, but also broad support on the Senate side to move that bill and to get it across the finish line so schools can again have the option of serving 2% and whole milk in the school meal programs.

Alan Bjerga: How realistic would you peg passage this year? And if you’re a dairy activist at home or in your tractor, what can you do to increase those chances?

Claudia Larson: Well, I think there definitely is a real possibility that this bill becomes law this year. It is an election year. We would expect it to probably have to move in the first half of the year, probably at least before August. There is, again, broad support for this. We have heard from so many farmers and school nutritionists across the country who are supportive of this bill.

So I think what it really comes down to is showing the US Senate, showing our senators there that we really do want this bill to become law. This is important to our students, this is important to our schools, this is important to our parents. And I think, again, the best way to do that is to reach out to your senators, let them know that this is important to you and your children in your community and ask them to please co-sponsor the bill. Ask them to talk to leadership and say that this is an important part of our overall effort to make sure kids have access to vital nutrients.

A quick and easy way to do that would actually to go to National Milk’s website where there is, we would call it our call to action page. But if you just go to the main page of National Milk, so nmpf.org, National Milk Producers Federation, there’s a page there that says, “Support increasing kids access to milk’s vital nutrients,” and you click on a button that says Take Action. And what this does is connect individuals who want to reach out to their senators, to their senators with the opportunity to write a note and tell their senators how vital it is that we move this bill. So again, you can call your senator, you can email your senator, or you can use this quick connection that we have set up on National Milk’s page so people can reach out and really voice their support for this really important child nutrition bill.

Alan Bjerga: And that is at nmpf.org. It’s our Take Action page. So you just look for Take Action on the menu, you click on that, you’ll be taken right there.

So all this is going on on Capitol Hill. Meanwhile, there’s a regulatory effort going on. This is the twice a decade revision to the federal Dietary Guidelines for Americans. We’re having a meeting on it this month. The process is moving forward. That’s an action led together by the USDA and the Department of Health and Human Services. Where are we in that process, Miquela, and how does whole milk figure into that debate?

Miquela Hanselman: So right now, the advisory committee is reviewing the science to determine the recommendations that they’ll make to the Department of Health and Human Services and USDA for updating the Dietary Guidelines. So the way it goes is to determine which areas should be looked at for each update. In the Dietary Guidelines, there’s these scientific questions that are identified, and these are based on a number of things. One of them being what was included in the Future Directions chapter of the previous committee’s recommendations.

So once the scientific questions are determined, that kind of tells the committee what science they need to be looking at to answer those questions. One of the scientific questions this time is looking at the relationship between sources of saturated fat and cardiovascular disease. So this was something that had been pointed to by the previous committee in that Future Directions chapter that I had mentioned, and it’s important for whole milk because of that blanket claim that’s been said that all saturated fat is bad. And that was really one of the main drivers for only recommending fat-free and 1% milk varieties.

So our hope this time is that the committee will at least include that newer science on dairy fat that demonstrates that there’s a neutral or positive relationship with whole milk and cardiovascular disease, obesity, stroke, and so on in their review, which would hopefully lead to an updated recommendation that includes whole milk in the DGAs.

Alan Bjerga: Given how valuable whole milk is for nutrition and its popularity in the marketplace as a source of nutrition and the preponderance of the scientific evidence saying, “Hey, this is good nutrition,” why are we even in this position trying to convince the committee that whole milk needs more support?

Miquela Hanselman: Well, it largely goes back to the thought that all fat is bad. I mean, I know my grandparents’ generation, my grandma drinks fat-free milk because they grew up hearing fat is bad, you need low fat, everything. It wasn’t until more recently that studies began to show that there is a difference in health outcomes really based on that source of saturated fat. And it goes back to what we’re now calling the dairy matrix, which is that interplay of all the components and milk and dairy products that do lead to the neutral or positive outcomes when it comes to certain diseases. But on the flip side of that, I mean, I think as humans generally we’re resistant to change, and so the committee is trying to make the best recommendation possible based on the science they have available. I think the biggest thing for us this time around is that we really just want them to look at the new science, to take that into consideration.

Alan Bjerga: You mentioned something that I think has a lot of implications for another set of debates as well. I’m thinking about plant-based, lab-based equivalent forms of nutrition. With the dairy matrix, this really is about not just what the nutrient is, but how substances interact. Is that something that you see the Dietary Guidelines’ becoming more mindful of? Because you look at the science on this and you look at the implication of that philosophy, it has a lot to say about whether soy beverages fortified are really equivalent, or if you synthesize a dairy protein in a lab, do you call it milk? I know this is a separate question, but I’d be really interested in what your thoughts are on that in terms of where it fits into current dietary science debates.

Miquela Hanselman: It’s definitely starting to come up more and more in the debates. I want to say the committee this time around is focused so much on that. If you see them include some of the newer science on dairy fats, those studies will be included about the dairy matrix and all of that.

Alan Bjerga: So bringing it back to whole milk, here’s a question for both of you. We’ve talked about whole milk on Capitol Hill. We’re talking about it in the agencies. Where do they intersect? And this is an intentional pun, what is the holistic perspective on this?

Claudia Larson: So when it comes to milk in schools, current law requires that the varieties of milk served in school meal programs be consistent with the Dietary Guidelines for Americans. So every time those Dietary Guidelines are updated, there is the opportunity for new types of milk to be allowed in square meal programs. Any sort of opposition that we have for this bill tends to come from those who say, “Well, we should let the Dietary Guidelines process play out. We should let the Dietary Guidelines expand the options for milk. And we really shouldn’t be doing this via congressional statute.” However, we do believe that showing broad support for this measure, again bipartisan support in both chambers, should really help signal to the Dietary Guidelines committee that the science is real, there is broad support for this, and they really do need to consider this updated science in this round of their review.

Miquela Hanselman: Yeah. And it’s kind of when you think about the committee, they’re looking at the science, but they’re also human beings. And the House passing this bill with such strong commanding support signals that this is an issue that is being taken seriously. If anything, it makes it so USDA and HHS are hopefully giving this a closer look.

Claudia Larson: And just in case they don’t this go round, all the more reason that we do want to see support for this bill on the Senate side and hopefully get it across the finish line. June/July would be fantastic.

Alan Bjerga: World Milk Day is June 1st. Is there anything else we need to know beyond the need for activists to take action at nmpf.org, the Take Action page? What else is there about this issue that you think people listening to this need to understand?

Claudia Larson: I always just want to flag one thing here with regards to the Whole Milk for Healthy Kids Act. What this bill does, it doesn’t force schools to serve varieties of milk they don’t want to serve, and it doesn’t force students to drink milk that they don’t want to drink. What it does is it provides our schools expanded options that are helpful and that kids tend to like to drink more. And it gives them these options so they can actually address students’ real nutrient intake needs. And I think when we provide our schools with the ability to better serve students and better address nutrition insecurity, then it’s good for all of us.

Miquela Hanselman: And help decrease hopefully food waste by giving children the options they want.

Alan Bjerga: That was NMPF Director of Regulatory Affairs, Miquela Hanselman and Claudia Larson, whose actual title at NNPF is senior director, Government Relations and head of Nutrition Policy. Be sure to catch Claudia at Dairy Forum next week in Arizona. If you are going there next week, she’s going to be speaking on a panel about some issues related to nutrition and diverse communities that also can be served very well by whole milk.

We do have the Call to Action live at nmpf.org/takeaction if you want to go straight to the URL, or just go off the website. And we do want you to spread this word. So however you got to this podcast, please share it far and wide. You can find us on Apple Podcasts, Spotify, and Google Podcasts. Thanks.

Upheaval ahead Russian dairy industry

Weak local demand and shipping issues to international clients are likely to be problems for Russia’s dairy sector in 2024. Although Russian dairy producers do not foresee a noticeable uptick in production, increasing demand is essential if they are to meet that need. In 2023, the suggested per capita intake of dairy products in Russia was 165.6 kg, indicating a decrease in consumer behavior. Due to a decline in buying power and a shift in consumer focus to budget price categories, the Russian dairy union has issued a warning about a potential 20-30% drop in dairy consumption in the first half of 2023. Russia is still importing more dairy products than it is exporting. Reasons for this include Western sanctions, high freight costs, high port fees, and unpredictable exchange rates for the Russian currency, all of which limit sales to non-Russian clients. Some logistics providers are still hesitant to partner with Russian companies, according to Russian exporters. Manitskaya is skeptical that the Russian government’s new policy, which would repay logistical subsidies to dairy exporters in full beginning in early 2024, will have a major influence on Russian exports. Every year, between 200,000 and 300,000 cattle, including 100,000 dairy cows, are lost from Russia’s herds.

Dairy Strong Conference Celebrates Strength Through Sustainability

More than 450 people attended the annual Dairy Strong conference to explore the industry’s latest innovations, celebrate its collaborations and delve deep into sustainability.

Conference attendees included farmers representing 280,000-plus cows along with industry experts and representatives from allied business sectors. They listened to keynote addresses, panel discussions and presentations on the latest technology and sustainability tactics. More than 40 vendors shared their products and services during the tradeshow. The event, themed “Growing Stronger Through Sustainability,” was held this week at the KI Convention Center.

“For over a decade, Dairy Strong has been a hub of information for all those involved in the dairy industry in Wisconsin and throughout the entire Midwest,” Dairy Business Association President Lee Kinnard said. “The name Dairy Strong speaks to the dedicated and resilient people who make up our dairy community. Dairy is never short of challenges, but we continue to overcome them through innovative, forward-thinking solutions.”

Strategist and bestselling author Thomas P.M. Barnett shared insights during the event’s kick-off keynote address on the latest demographic studies and what steps the United States can take to win over the globe’s growing middle class, which will help U.S. farmers with selling their products abroad. He said the world is going through three major transitions — climate change, demographic transition and a growing global middle class.

Scott Caine, president of Aimpoint Research, the closing keynote speaker, discussed key concerns for dairy farmers going forward and the steps needed to keep the industry secure.

“Food security and how we produce that food is a national security issue,” Caine, a U.S. Army intelligence officer veteran, said. “We have the ability to supply the food, fiber and fuel not only for our country but to export that as well.”

Attendees also heard from baseball’s iron man, former Baltimore Oriole Cal Ripken, Jr., who played in 2,632 consecutive games.

“People always ask me how I played in so many games and what the secret was to my longevity, and it was about the power of perseverance,” said Ripken, a member of the National Baseball Hall of Fame and a lifelong milk drinker.

Multiple-site expansion

Panel discussions and presentations filled out the remainder of the two-day conference.

One panel discussion looked at the growing number of dairy farmers who are adding a second or even a third site to grow their business. Across Wisconsin, 47 dairies have more than one location. Farmers who run dairies at multiple sites shared insights on operation expansion.

Christine Bender, a sixth-generation dairy farmer from Watertown, Wis., who farms with her husband and parents, expanded the operations to a second site last spring when they purchased another herd of cows and signed a five-year facilities lease on a property about 20 miles from their home dairy, McFarlande Dairy. They were looking at the option of eventually adding a rotary milking parlor, but to make financial sense the dairy would need more cows.

“We saw adding this herd as a stepping stone to being able to get that new parlor,” Bender said. “To run two sites successfully, the key for us is to have the key people in the right positions.”

One of Wisconsin’s largest family-owned dairies, Pagel Family Businesses, which includes Pagel’s Ponderosa Dairy, LLC, in Kewaunee, Wis., has run multiple sites since the early 2000s. JJ Pagel, who runs the business with his siblings, said strong relationships with neighbors, vendors and employees are vital to making everything run smoothly. The dairy has also embraced technology, allowing Pagel to view key information, such as milk production, from an online dashboard.

“We have operation managers at each site. We bring in the teams from each site once a week, such as the maintenance guys in on Tuesday, and they talk about what’s going on,” said Pagel, whose dairies milk around 11,000 cows and farm about 15,000 acres. “The dashboards are helpful since I can’t be on every farm at the same time.”

Sustainability strategies

Conservation and sustainability were leading themes at this year’s Dairy Strong, with several presentations focused on various parts of the issue from how to use cover crops to improve soil health to the role of sustainability in the industry’s supply chain.

“We hear from our customers (food manufacturers) that they want decreased greenhouse gases throughout the process, starting with the producer,” said Holly Jones, director of global sustainability for Agropur, during a discussion on dairy supply chain collaboration. “The majority of farmers are open to sustainability initiatives, and many farms are already carbon neutral.”

Farmer recognition

Two awards were given out at the conference.

The Dairy Business Association honored Tom Crave of Crave Brothers Farm in Waterloo, Wis., with the association’s Advocate of the Year award for his role in shaping Wisconsin’s dairy community. And, a new award was unveiled in collaboration with Dairy Farmers of Wisconsin for dairy men and women who prioritize building trusted relationships with their neighbors and the surrounding community.Doug Grotegut of Grotegut Dairy Farm Inc. in Newton, Wis., was the inaugural recipient of the Community Builder Award.

About DBA
The Dairy Business Association is Wisconsin’s leading dairy lobby group, championing smart and sensible regulations affecting the dairy community. The nonprofit organization is comprised of farmers, milk processors, vendors and other business partners who work collaboratively to ensure that dairy farms of all sizes have the support they need to keep America’s Dairyland strong. More information: www.dairyforward.com.

Why Wisconsin Lost 455 Dairy Farms Last Year

Wisconsin dairy farmers are facing market declines, with the state’s Department of Agriculture, Trade, and Consumer Protection (DATCP) reporting a drop of 455 dairy farms last year. Over the last decade, Wisconsin’s total cow population has remained stable at approximately 1.2 million cows. CEO Chad Vincent of Dairy Farmers of Wisconsin has worked closely with the Department of Agriculture and sent out a farm survey in March 2020, inquiring about dairy producers’ plans to stay in business and whether they have a succession plan in place.

At the time, 17% of the state’s dairy farms said they would stop milking within five years. According to the 2020 survey, 22% of all dairies with fewer than 100 employees intend to close within the next five years. This is heavily influenced by the milk price, costs, financials, economics, and other variables.

In the last three months, Wisconsin’s Department of Agriculture reported 94 dairies closing in October, 94 in November, and 87 in December. The majority of those numbers lean toward smaller dairies, as the state has more farms with fewer than 200 cows than farms with more than 200 cows. Wisconsin had 5,895 dairies when the new year began. Vincent believes that the dairy industry will not slow down in the next three to five years, as 65% of primary decision-makers on the farm were over the age of 50, and 15% were over 65.

Despite the harsh reality that America’s Dairyland is losing farms, Wisconsin dairy is as strong as ever, though it is unfortunate that the next generation will not return. Dairy farming is difficult work, with a scarcity of labor and talented workers. When dairy farmers retire, they frequently sell their cows and keep them in the state.

The good news is that Wisconsin has excellent infrastructure, and milk and cheese production and sales continue to grow. However, the lack of the next generation or the ability to weather the storm is unfortunate, as Wisconsin’s diverse farm landscape makes it America’s Dairyland.

“Irish dairy can grow” despite a “very tough” economy in 2023 says Bord Bia

  • Irish dairy exports saw a modest decline in 2023, falling by around 8% to €6.3bn in value terms due to global trade decline.
  • The decline was attributed to an oversupply situation and bearish global commodity markets.
  • The cost of living crisis and the challenge of affordability for global consumers led to a significant drop in the supply chain of dairy commodity products.
  • Butter, cheese, and whey, which made up 45% of the total dairy export volume, suffered price declines in 2023.
  • Irish butter exports to the EU and North America declined 9% and 8% respectively, while exports to the US increased more than 10% in the first 9 months of 2023.
  • Exports to Southeast Asia and the Middle East performed favorably, with the value of Irish dairy exports growing 24% to €390m.
  • Demand from China is expected to return in 2024, with some solidity in infant formula export figures despite a downturn in import demand.
  • The future of Irish dairy exports is expected to be lessened in 2024 due to lower global stocks and more affordable stocks.
  • The demand for environmentally-sound dairy products is expected to remain a sustainable trend.
  • Overall food, drink, and horticulture exports in Ireland were down 4% on 2022.
  • Bord Bia remains optimistic about the future, with almost 70% of exporters believing some level of expansion can be achieved in European and Americas markets.

Irish dairy exports fell slightly in 2023, but in value terms, they increased to €6.8 billion (+33%) due to high farmgate milk prices and strong milk production. However, global trade declined throughout 2023, resulting in an 8% drop in value to €6.3 billion. A 6% increase in the value of cheese, specialized nutritional powders, and yogurt partially offset the overall decline, but the 2023 result was still 22% higher than the 2021 export performance.

David Kennedy, Bord Bia’s head of dairy, attributed this year’s drop in dairy exports to an oversupply situation that emerged in 2023 and bearish global commodity markets. High farmgate prices for milk around the world resulted in increased supply, which struggled to make its way through the supply chain because affordability was a major issue for global consumers. This was evident in Europe, where butter and cheese retail sales were challenged, as well as North America, Southeast Asia, and West Africa.

Butter (€1.3 billion), cheese (€1.2 billion), and whey ($250 million) accounted for 45% of total dairy export volume, with all three commodities experiencing price decreases in 2023. Ornua’s Kerrygold is expected to be one of the largest butter brands in the US market by the end of 2023. Exports to Southeast Asia were mixed, with cheese volumes in Japan remaining consistent, which he described as a’really important’ market for Irish cheese outside of Europe.

The Middle East also performed well, with the value of Irish dairy exports increasing 24% to €390 million. Retail sales in Saudi Arabia are thought to be a major driver in the region. China’s demand is expected to return in 2024, with infant formula export figures holding up better than in previous years. Kennedy expects the challenges of last year to be mitigated this year, with global stocks lower than in 2023 and more affordable.

Demand for environmentally friendly dairy products is also expected to continue, with international customers increasingly seeking low-carbon footprint, highly sustainable dairy ingredients. Bord Bia remains optimistic about the future, as it prepares to launch a new four-year strategy later this year.

New, Board-Approved CDCB Strategic Plan

At its December 2023 meeting, the CDCB Board of Directors approved a new CDCB Strategic Plan that directs organizational priorities and activities for 2024 to 2026.
 
In 2023, CDCB staff and Board members completed an introspective and deliberate process that included direct input from data providers and collaborators. Business planning expert Jeffrey Hansler, of Oxford Company Consultants, coordinated a board strategic session in April 2023, facilitated the National Cooperator Dairy Database Workshop in August 2023 and guided staff through the future-focused process and plan development.
 
CDCB’s vision, mission and core values – it’s organizational North Star – remain constant.


 
Five newly defined strategic priorities are pillars of the plan, and they are based on opportunities voiced by the Board of Directors and data providers at the National Cooperator Dairy Database Workshop. Strategic priorities answer how CDCB will fulfill its mission to drive dairy cattle improvement, encompassing collaborative communication, data quality and integration, technology and infrastructure advancements, comprehensive training programs, and strategic partnerships for portfolio diversification.

 
The new Strategic Plan outlines achievable and relevant goals for the next three years. Importantly, the plan includes a detailed Gantt chart of activities and timelines, ensuring transparent and effective execution of each strategic priority.
 
At its December meeting, the Board also reviewed and approved the 2024 budget and project plans that directly support the five strategic priorities.

With this clear roadmap, CDCB is positioned to overcome challenges, capitalize on opportunities, and maintain its leadership in the dynamic dairy industry landscape.

USDA predicts fewer cows and milk in 2024.

USDA has cut 2023 dairy production and cow inventories and 2024 estimates. Friday’s supply and demand report showed lower 2023 milk production due to fewer cows and slower milk output per cow increase.

USDA expects 228.3 billion pounds of milk output this month and 226.9 billion pounds in December.

Fat and skim-solids imports for 2023 remained maintained, while cheese and butter fat imports may drop 2024 forecasts. Fat exports fell in 2023, whereas skim-solids exports rose. Fat exports will grow in 2024 as butter and cheese costs become more competitive. 2024 skim-solids exports remain constant.

Cheese prices are lower than whey prices in 2024, lowering Class III milk costs. Butter and nonfat dry milk estimates raised Class IV costs. The 2023 national average all milk price projection remains at $20.60 per cwt, while the 2024 forecast drops to $20.00.

The January 31 USDA Cattle Report will reflect producer plans to keep dairy heifers for breeding.

As viable alternatives to dairy, plant-based beverages encounter various challenges: NUS-led study

  • The plant-based drink processing sector faces challenges such as persistent beany smell and urease in soy drinks, product safety, nutritional considerations, and stability during processing.
  • Aromatic compounds contribute to their overall flavour profile, and understanding flavour formation pathways helps in optimising the aroma and minimising off-flavours.
  • Oxidative fat degradation is a common issue in developing plant-based beverages, leading to off-flavours and undesirable tastes.
  • Heat-sensitive health risk factors pose challenges, and multi-phase dispersion systems in plant-based drinks are prone to physical instability and phase separation.
  • Plant-based drinks are susceptible to spoilage, and developing efficient methods to control harmful micro-organisms is imperative.
  • The plant-based drink industry faces a critical bottleneck in consumer acceptance due to bitter and astringent flavours.

In the plant-based drink processing sector, industry leaders face multi-faceted challenges that demand strategic solutions for sustainable evolution. Key issues include the persistent beany smell and urease in soy drinks that affect their culinary appeal, and the presence of starch granules in oat drinks that affect their otherwise smooth taste. Other challenges include product safety, nutritional considerations, and stability during processing.

Oxidative fat degradation is a common issue in developing plant-based beverages, leading to off-flavours and undesirable tastes. Researchers have found that when plant-based drink ingredients are stored under normal conditions, their quality remains stable. However, during processing, the activation of endogenous lipoxidases can trigger oxidative fat degradation, resulting in the development of rancidity and other unpalatable flavors.

The health benefits of plant-based drinks hinge on their structure, particularly their cell wall composition. Optimizing processing technologies, such as heat treatment and extrusion, is crucial to break down cell walls and enhance nutrient dissolution. Heat-sensitive health risk factors, such as cyanogenic glycosides and anti-vitamin factors, pose challenges. Elimination methods, such as enzymatic hydrolysis and fermentation, are employed to address allergens like soybean proteins and gluten. Multi-phase dispersion systems in plant-based drinks are prone to physical instability and phase separation, and chemical and biochemical processes like oxidation and hydrolysis further threaten stability, impacting the safety and taste of plant-based drinks.

 

New York Governor Propose Dairy Farm Improvements

In her 2024 State of the State speech, Gov. Kathy Hochul proposed subsidizing dairy farmers and establishing a “one-stop shop” for the agricultural workers.

“New York’s agriculture industry is a key part of our economy, communities, and way of life,” Hochul stated. My experience as the first upstate New York governor in almost a century has shown me how important this industry is. I support agriculture and food production and concentrate on legislation and investments that help farmers.”

New York State Agriculture Commissioner Richard Ball said farmers and the agriculture community need help.

“As we move into the new year, we have truly doubled down on our work on filling the gaps in our food system, protecting the natural resources we depend on, and developing a strong generation of future leaders,” Ball added.

New York Farm Bureau President David Fisher said they would work with Hochul and the Legislature to strengthen agriculture and family farms.

“In her State of the State, the governor promises to fight for farmers, especially amid climate and labor issues. Fisher said, “We appreciate the recognition as these issues weigh heavily on New York agriculture.”

He stated her executive budget plan would clarify her support for these programs.

“We are hopeful that she will continue to fully fund much needed programs that support environmental conservation, research, agricultural promotion, and food access programs like Nourish NY and Health School Meals for All,” Fisher added.

Hochul wants $34 million over two years for on-farm fluid milk storage technologies and processing infrastructure to reduce transportation during pandemics and winter storms in Western New York.

On-farm fluid milk storage will enhance capacity but not milk storage duration, according to Cortland dairy farmer Mike McMahon.

He claimed milk is so perishable that without rigorous mitigations like aspectic milk or pasteurization, it’s only good for a few of days before germs start developing.

Just one farm would need millions to adopt the technology to process milk for more than a few days, McMahon said.

Hochul also suggested $21 million for an Alternative Waste Management and Enhanced Precision Feed Program to reduce greenhouse gas emissions, absorb carbon, and help farmers scale.

McMahon, whose farm EZ Acres was a Cornell University case study, said, “I’m a huge believe in [precision feed management] and I think that’s money well spent as far as other nutrient management practices that may be enhanced by that there’s a lot of technology out there but there never seems to be enough money, so I certainly applaud her

On his farm, McMahon uses precision feeding.

“You’re much more precisely feeding the cow to sustain her body and produce milk without giving her excess protein and things like that, which will produce greenhouse gases,” he added.

Hochul suggested a new program to help New York’s agricultural workforce, which has witnessed several changes, including lowering farmworker overtime.

In conjunction with Cornell University’s Agricultural Workforce Development Program, the state would provide office hours, webinars, a FAQs section, a web portal to submit queries, and a farmworker and farmer hotline.

The Labor Department, New York State Public Employee Relations Board, and Agriculture and Markets would support it.

Hochul wants a “one health approach” to enhance illness detection and prevention, food safety education, and veterinarian care optimization to protect people, animals, and the environment.

These initiatives include increased engagement with New York’s Veterinary Diagnostic Laboratory Advisory Board, a new program to prevent improper use of xylazine, reimbursement and fee changes for on-farm animal health testing programs, and a new program.

The group has been asking for a $1 million budget boost for the New York Center for Agricultural Medicine and Health for months. Hochul requested this.

German farmers protest against proposed subsidy cutbacks

Farmers park tractors at the Brandenburg Gate to protest planned cuts to state subsidies in Berlin, Germany on Jan. 8. Photographer: Sean Gallup/Getty Images

  • Thousands of German farmers block cities and roads to protest against government farm subsidy cuts.
  • The main issue is the government’s plans to phase out tax incentives for diesel fuel used in agriculture and a car tax exemption for agricultural vehicles.
  • The German Farmers Association, state farmers’ associations, and LsV Germany are calling for the withdrawal of the federal government’s planned tax increases for agriculture.
  • The protests have impacted Germany’s transportation network, with farmers blocking key highways and roads in cities like Berlin, Munich, and Hamburg.
  • Chancellor Olaf Scholz declined requests to accommodate farmers, stating that the administration will continue to implement the strategy agreed upon by the three coalition parties.
  • More demonstrations are scheduled in response to transportation delays, impacting manufacturing operations and commuters.
  • The farmers’ demonstrations and an impending train driver strike are causing challenges in Germany.
  • Opposition leaders express support for nonviolent demonstrations against the budget cuts, despite the opposition’s denouncement by politicians and the agricultural lobby.

Thousands of German farmers have blocked cities and roads to protest against government farm subsidy cuts. The main issue is the government’s plans to phase out tax incentives for diesel fuel used in agriculture and a car tax exemption for vehicles used in agriculture. The German Farmers Association has planned a week of protests across the country to make the farmers’ voices heard. Nationwide, over 100 protests are taking place in all federal states to warn the population and politicians against jeopardizing the competitiveness and existence of farmers and medium-sized transport companies. The German Farmers’ Association, along with state farmers’ associations and LsV Germany, has called for the federal government’s planned tax increases for agriculture to be withdrawn. This is the latest protest by farmers across Europe, including the Netherlands, Romania, Belgium, France, Poland, and Austria.

As demonstrations wreaked havoc on Germany’s transportation network, Chancellor Olaf Scholz turned down requests to further accommodate farmers.

On Monday, farmers protested the elimination of a fuel subsidy by taking to the streets with tractors, blocking key highways and roads in cities like Berlin, Munich, and Hamburg. Nonetheless, according to Scholz, the administration will continue to implement the strategy that the three coalition parties agreed on last week.

They agreed to abandon a prior proposal to eliminate a tax credit for the agricultural and forestry industries in order to pacify the farmers and comply with the agreement. Also, during the following three years, authorities have promised to gradually eliminate a fuel subsidy.

Following his meeting with his Luxembourg colleague, Scholz said at a Berlin press conference on Monday, “That is our proposal and I believe it is right and balanced.”

More demonstrations are scheduled over the next several days in response to Monday’s transportation delays, which impacted both manufacturing operations and commuters. According to a letter to carriers reviewed by Bloomberg, gasoline supplies to an oil-processing facility in southern Germany were impacted, while employees at a Volkswagen AG factory in the northern German city of Emden were unable to report for work.

Germany is now facing a number of challenges, including the farmer demonstrations and an impending train driver strike that would impact both passenger and freight operations.

Scholz and Robert Habeck, the minister of the economy, both spoke out in support of the farmers’ right to demonstrate. However, Habeck cautioned in a video that was uploaded on X (previously Twitter) that far-right organizations were trying to seize control of the protests and cause instability in the nation. An altercation broke out between demonstrators and police last week as a hundred farmers blocked his disembarkation from a north coast boat.

On Monday, opposition leaders expressed their support for nonviolent demonstrations against the budget cuts, despite the fact that the episode had been denounced by politicians from both parties and the agricultural lobby.

The farmers’ backing from four state premiers from Scholz’s Social Democrats casts doubt on the unity of the government coalition’s position to reject requests.

Fifty years of environmental progress for United States dairy farms

  • Milk production efficiency has significantly improved, with 30% fewer cows producing twice the amount today.
  • Increases in crop yields, fuel efficiency of farm equipment, and efficiency in producing most resources have led to changes in environmental impact.
  • Simulations of dairy farms in 1971 and 2020 revealed changes in nutrient losses and farmgate life cycle assessments of greenhouse gas emissions, fossil energy use, and blue water use.
  • The national average intensity of GHG emissions decreased by 42%, but total GHG emissions increased by 14% over the 50-year period.
  • Fossil energy use intensity decreased by 54%, but total blue water use increased 42% due to increased dairy production in dry western regions.
  • Major pathways of nitrogen loss include ammonia volatilization, leaching, and denitrification.
  • Simulated nitrogen and phosphorus runoff losses decreased 27 to 51% through more efficient fertilizer use, reduced tillage, and greater use of cover crops.
  • Emissions of methane and reactive non-methane volatile organic compounds increased due to greater use of long-term manure storage and silage stored in bunkers and piles.

Dairy farms in the United States (US) have altered significantly during the last 50 years. Milk production efficiency has skyrocketed, with around 30% fewer cows producing about double the quantity of milk today. Other advantages include increased crop yields, fuel economy of farm equipment, and efficiency in the production of the majority of agricultural resources (electricity, fuel, fertilizer, etc.). These enhancements have resulted in changes in the environmental effects of farms. Through modelling of typical dairy farms in 1971 and 2020, variations in nutrient losses and farmgate life cycle evaluations of greenhouse gas (GHG) emissions, fossil energy consumption, and blue (ground and surface) water use were found for six regions and the US. For all environmental measures analyzed, intensities expressed per unit of fat and protein-adjusted milk produced decreased, while overall effects across all farms or milk produced rose for 5 of the 13 environmental metrics. Reductions in the consequences of dairy farms in the eastern United States were compensated by big increases in western areas as cow numbers increased significantly. The national average intensity of GHG emissions was reduced by 42%, resulting in just a 14% rise in total GHG emissions from all dairy farms throughout the 50-year period. The intensity of fossil energy usage declined by 54%, while the total number of farms decreased by 9%. Water consumption for milk production declined by 28%, but owing to the substantial rise in dairy production in the arid western areas, which rely more on irrigated feed crops, overall blue water use grew by 42%. Ammonia volatilization, leaching, and denitrification were the major mechanisms of nitrogen loss. Total ammonia emissions from US dairy farms climbed 29%, whereas leaching losses were reduced by 39%, with no change in nitrous oxide emissions. Simulated nitrogen and phosphorus runoff losses for all dairy farms fell by 27 to 51% due to more effective fertilizer usage, less tillage, and increased use of cover crops. Methane and reactive non-methane volatile organic compound emissions rose by 32% and 53%, respectively, as long-term manure storage and silage kept in bunkers and piles were used more extensively. Although great success has been achieved in increasing production efficiency, more improvement with new techniques and technology is required to fulfill dairy product demand while decreasing overall environmental consequences, especially in light of expected climatic unpredictability.

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Genetic evaluations for specific digital dermatitis

  • The study used detailed phenotyping for DD stages in two housing systems: conventional cubicle barns (CON) and compost bedded pack barns (CBPB).
  • 2,980 observations were made for the three traits DD-sick, DD-acute, and DD-chronic from 1,311 Holstein-Friesian and 399 Fleckvieh-Simmental cows.
  • The study found an average disease prevalence of 20.47% for DD-sick, 13.88% for DD-acute, and 5.34% for DD-chronic, with a higher prevalence in CON than in CBPB.
  • After quality control of 50K genotypes, 38,495 SNPs from 926 cows remained for genomic analyses.
  • Genetic correlations between same DD traits from different housing systems and between DD-sick, DD-chronic, and DD-acute were estimated via bivariate animal models.
  • Genetic correlations among DD-sick, DD-acute, and DD-chronic ranged from 0.58 to 0.81.
  • SNP main effects and SNP x housing system interaction effects were estimated simultaneously via GWAS considering only the phenotypes from genotyped cows.
  • GWAS for main effects indicated heterogeneous Manhattan plots for DD-acute and DD-chronic, indicating particularities in disease pathogenesis.
  • Some shared annotated potential candidate genes were identified for DD-sick and DD-acute, with direct or indirect effects on disease resistance or immunology.

The current research aims to employ thorough phenotyping for the claw disease digital dermatitis (DD), taking into account distinct DD phases in two housing systems (conventional cubicle barns = CON and compost bedded pack barns = CBPB), to predict potential genotype x housing system correlations. The DD-stages contained 2,980 observations for the three features DD-sick, DD-acute, and DD-chronic in 1,311 Holstein-Friesian and 399 Fleckvieh-Simmental cows. The 5 CBPB and 5 CON herds were selected using a special process to produce a high degree of herd similarity in terms of climate, food, milking system, and location, but with significant housing system variances. Five additional farms used “a mixed system” with two sub-herds, one representing CBPB and the other representing CON. The CBPB system had 899 cows (1530 observations), whereas the CON system had 811 cows (1450 observations). The average illness prevalence was 20.47% for DD-sick, 13.88% for DD-acute, and 5.34% for DD-chronic, with CON showing a greater frequency than CBPB. Following quality screening of 50K genotypes, 38,495 SNPs from 926 cows remained for further genomic analysis. Genetic parameters for DD-sick, DD-acute, and DD-chronic were computed using single-step techniques for single-trait repeatable animal models, taking into account the whole data set, as well as the CON and CBPB subsets individually. Genetic connections between the same DD features in various housing systems, as well as between DD-sick, DD-chronic, and DD-acute, were assessed using bivariate animal models. Heritabilities based on the whole data set were 0.16 for DD-sick, 0.14 for DD-acute, and 0.11 for DD-chronic. A modest increase in heritabilities and genetic variations was seen in CON as compared to the “well-being” CBPB system, showing a greater genetic differentiation of illnesses in a more stressful environment. Genetic correlations between identical DD characteristics recorded in CON or CBPB were close to 0.80, excluding out clear genotype x housing system interactions. Genetic correlations between DD-sick, DD-acute, and DD-chronic varied from 0.58 to 0.81. SNP main effects and SNP x housing system interaction effects were calculated concurrently using GWAS using solely genotyped cow phenotypes. Ongoing annotations of putative candidate genes are centered on chromosomal regions 100 kb upstream and downstream of the substantially related candidate SNP. GWAS for main effects revealed varied Manhattan plots, particularly for DD-acute and DD-chronic, suggesting differences in disease pathophysiology. Nonetheless, a few shared annotated putative candidate genes, including METTL25, AFF3, PRKG1, and TENM4, for DD-sick and DD-acute, were discovered. These genes have a direct or indirect impact on disease resistance or immunology. For the SNP x housing system interaction, the annotated genes ASXL1 and NOL4L on BTA 13 were significant for DD-sickness and DD-acute. Overall, the extremely comparable genetic parameters for the same qualities in various habitats, as well as the insignificant genotype x housing system interactions, suggest that housing system differences have very small influence on genetic assessments for DD.

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National Milk Day: Nourishing America with the USDA’s Dairy Initiatives

glass carafe of milk with cows in the background

National Milk Day is observed on January 11th each year to commemorate the day in 1878 when milk deliveries began in glass bottles sealed with waxed paper. It is also a time to appreciate the contributions of dairy farmers and serves as a reminder of the nutritional value and cultural significance of dairy in the lives of many Americans.

As we celebrate National Milk Day, we also recognize the crucial role the United States Department of Agriculture (USDA) plays in ensuring that Americans have access to wholesome, high-quality dairy products.

glass bottles of milk in processing plant

Here is how the USDA contributes to the dairy industry and promotes the well-being of individuals and families across the nation:

Research and Innovation:
The USDA invests in research to enhance the efficiency and sustainability of dairy production. This includes promoting best practices for animal health and business innovation initiatives in the dairy industry.

Educational Outreach:
Through programs such as MyPlate and Food and Nutrition Service (FNS), the USDA highlights the nutritional value of dairy products and encourages consumer awareness of dairy products as part of a healthy lifestyle.

Nutritional Assistance Programs:
The USDA administers programs like the National School Lunch Program and the Supplemental Nutrition Assistance Program (SNAP), providing nutritious dairy options to school children and low-income families. This ensures that dairy is accessible to those who need it most.

Dairy Price Support Programs:
The USDA implements initiatives to stabilize dairy prices, providing support to dairy farmers during periods of market uncertainty. This helps maintain a stable supply of affordable dairy products for consumers.

Ag Secretary Vilsack Celebrates National Milk Day

Today, Agriculture Secretary Tom Vilsack offered the following statement in support of America’s dairy industry, in advance of National Milk Day, which will be celebrated on Thursday, January 11. Agriculture Secretary Vilsack today visited the Pennsylvania Farm Show in Harrisburg, Pa., which is the nation’s largest indoor agricultural event. While there, he met with several dairy farmers and business owners who are contributing to local and regional food systems in and around Pennsylvania, and announced a $26 million Regional Food Systems Infrastructure grant that will help increase capacity and resilience in middle-of-the-supply chain activities, including dairy processing.

“On National Milk Day, we celebrate the historic moment in 1878 when milk was first delivered to homes in sterilized glass bottles, marking a turning point that made milk more accessible and a vital source of nutrition for families across the country. Our dairy farmers are the unsung heroes behind every glass of milk, working tirelessly to ensure families receive essential nutrients at the dinner table. Thanks to their innovation and productivity, high-quality dairy products can be relied upon as a component of nutritious school meals, at child and adult food service programs, and by families who participate in WIC—an important, evidence-based nutrition program that is gaining new participants at historic levels. Through active support for international trade, specialized safety net programs like the Dairy Margin Coverage Program, popular conservation programs like Environmental Quality Incentives Program, dedicated Dairy Business Innovation Centers, and more, USDA is committed to helping the America’s dairy industry remain competitive, access new and better markets, and keep their family businesses in operation for the long-term. At USDA, we are honored to work alongside America’s dairy producers as they provide necessary, nutritious dairy products to communities nationwide. Next time you enjoy a glass of milk, a slice of cheese, or a cup of yogurt, remember that these products are a result of the hard work and dedication of America’s dairy farmers.”

USDA’s Economic Research Service reports that in 2022, 226.46 billion pounds of milk were produced in the U.S., generating $57.51 billion (source). Milk cash receipts in Pennsylvania were $2.6 billion in 2022, putting them at their highest level since 2014. According to the International Dairy Foods Association, The U.S. dairy industry supports 3.2 million jobs (source), including 134,600 jobs in Pennsylvania (source).

7.4% decline in Wisconsin and Minnesota’s dairy farms in 2023.

  • Wisconsin’s Department of Agriculture, Trade, and Consumer Protection predicts 455 dairy farms closed in 2023.
  • Minnesota lost 146 dairy farms between January 1st and November 2023, averaging 7.4% loss.
  • Wisconsin lost 50 farms in April, 48 in October, 47 in July, 58 in November, and 34 in August.
  • USDA reports 2% more milk cows than a decade ago, but fewer dairy animals and fewer farmers.

The number of dairy farms continues to decline. Wisconsin’s Department of Agriculture, Trade, and Consumer Protection reports that 455 dairy farms will close in 2023. Minnesota lost 146 dairy farms between January 1st and the end of November, leaving both states on pace to lose 7.4% of their dairy farms by 2023. Minnesota’s agricultural data for January 1st are not yet available.

Wisconsin lost 50 farms in April, 48 in October, and 47 in July. Minnesota lost 58 dairy farms in November, and 34 in August. Not every state keeps track of the number of licensed dairy farms.

According to the USDA, the US has around 2% more milk cows than a decade ago, but there are less dairy animals than a year ago, as well as fewer farmers managing those cattle.

USDEC’s 2023 Global Dairy Business Year-in-Review

We have assembled the important mergers, key acquisitions, joint ventures, new facilities, executive hires and marketing initiatives that made 2023 a noteworthy year for global dairy business.

 

2023 Dairy Business News  (450 × 450px)

Across the international dairy sector, business activity has been brisk this year, as one can see from the U.S. Dairy Export Council’s 2023 Global Dairy Business Year-in-Review. 

USDEC monitors global dairy business developments for our members and curates them for our weekly, members-only newsletter, Global Dairy eBrief. At the end of the year, we aggregate and summarize what’s most relevant for this retrospective annual review. 

USDEC has done this since 2015, creating a one-of-a-kind archive that includes the following annual dairy business reviews:

We start the 2023 Global Dairy Business Year-in-Review review with items from the January 6 Global Dairy eBrief and end with news from the December 22 edition.

This is a fast-paced yet lengthy review. We put company names in bold for easy scanning.

Tip: To quickly find mentions of a company, search this long page. The easiest way to search on a PC is to use the keyboard shortcut Ctrl+F on Windows or Command+F on a Mac.

A one-stop review of 2023’s most important dairy business news

What follows is USDEC’s 2023 Global Dairy Business Year-in-Review, a curated summary of important global dairy business developments, presented in month-by-month chronological order, beginning in January.

 

January -1

Qatari milk producer and dairy processor Baladna Food Industries is exploring a large-scale dairy project in Algeria. Late last year, Baladna representatives and officials from Algeria’s Ministry of Agriculture visited a model farm project in the west of the country and presented plans for a 25,000-acre dairy farm and processing facility. The company is conducting a feasibility study on the soil and climate in the area, and depending on the results, it could launch the project by the beginning of 2024. Founded in 2017 in Qatar, the vertically integrated dairy company has been on a global expansion streak over the past few years. It has farm-to-bottle dairy projects in various stages of development in Malaysia, Indonesia and the Philippines, and last year purchased a minority stake in Egyptian dairy, juice and cooking product company Juhayna Food Industries. (USDEC Middle East/North Africa office)

California-based private equity firm Butterfly purchased Minnesota-based Milk Specialties Global. Current Milk Specialties CEO, Dave Lenzmeier, will continue to lead the business. Lenzmeier said he expects the acquisition will enable the company “to achieve a new level of growth.” … The European Commission approved the creation of a new joint venture between Dutch food and nutrition company Royal DSM and New Zealand’s Fonterra Co-operative Group. The new company, Tasman, will be headquartered in the Netherlands and will develop, produce and market fermentation-derived dairy proteins. (Company reports; Agriland, 12/28/22)

A Jan. 2 fire destroyed a butter storage room at the Associated Milk Producers Inc. (AMPI) plant in Portage, Wisconsin. Firefighters contained the blaze but not before butter runoff flowed into other areas of the plant and into storm sewers and a neighboring canal. Operations were temporarily halted on Jan. 3, and AMPI told Dairy Herd Management that cleanup would begin as soon as possible. … U.S. food giant Mars Inc. completed its new ice cream factory in Guangzhou, China, two months ahead of schedule. … Nestlé began testing its first animal-free milk product in California. The drink, branded Cowabunga, was developed with California-based food biotech start-up Perfect Day using precision fermentation technology. … Mead Johnson China launched a new adult nutrition brand called Agijoy. The product is designed for consumers over 50 and reportedly contains 23 nutrients (it is rich in protein and selenium) and lactoferrin. (USDEC China office; Company reports; Dairy Herd Management, 1/3/23; WMTV, 1/2/23; FoodBev.com, 12/22/22)

Dutch dairy giant FrieslandCampina became the latest major dairy manufacturer to venture into the “animal-free” dairy protein realm. The company’s FrieslandCampina Ingredients division signed a strategic partnership with California-based biotech company Triplebar Bio Inc. The two companies will work together to develop and scale up the production of cell-based proteins using precision fermentation technology. FrieslandCampina, which has been using precision fermentations to manufacture human milk oligosaccharides since 2016, said it plans to offer the lab-based proteins side-by-side with its dairy proteins and ingredients. (Company reports)

Ireland’s Ornua and its U.S. subsidiary Ornua Foods North America are suing New Zealand-based Westland Dairy Co. Ornua claims Westland’s Westgoldbutter infringes on its own Kerrygold trademark due to the similarity in packaging between the two brands. A hearing is slated for Feb. 9. …Yili Group completed Phase 1 of its new US$250-million fluid milk plant in Inner Mongolia. Product safety testing took place at the end of December, and the company expects to begin commercial production soon. … Finnish food and dairy company Fazer Foods is considering exiting the dairy business. Fazer characterized its dairy operations as “small scale” and is studying plans to convert its Koria, Finland, diary facility to oat-based drink and product manufacturing. … Alamar Foods, the master franchisee of Domino’s Pizza in the Middle East, North Africa and Pakistan opened its 600th Domino’s outlet in the region. The ribbon-cutting took place in Dubai. (USDEC China office; USDEC Middle East/North Africa office; Agriland, 1/10/23; FoodBev.com, 1/5/23)

Valley Milk is adding a 10,000-sq.-ft. addition to its Turlock, California, milk processing facility. The project, slated for completion in 2024, will produce AMF in drums and totes initially, with plans to expand to pails to serve industrial and foodservice customers. The company is targeting domestic and export markets with the new investment. There are “strategic opportunities” to export AMF into the international market, Valle Milk said. (Company reports)

Corman Miloko, a joint venture dairy spread and butterfat manufacturer based in Carrick-on-Sur, Ireland, plans to close its doors this June. Belgian butter, spread and fats and oils maker Corman owns a 55% stake in the operation, Ireland’s Tirlán (formerly Glanbia Ireland) owns the other 45%. Corman, in turn, is part of the French dairy company Savencia Fromage and Dairy. The closure comes after “significant restructuring” failed to turn around sagging volume sales. The joint venture company, which has been in business since 2005, sells primarily to export markets. (Agriland, 1/21/23)

Italian dairy-co-op Latteria Soresina plans to acquire Italian gorgonzola maker Fratelli Oioli. Sorensina said it hoped the acquisition would open additional export opportunities. … New York-based global equity firm General Atlantic paid $130 million for a 5.6% stake in Indonesian dairy and food processor Cisarua Mountain Dairy, also known as Cimory. Cimory said it plans to use the funding to accelerate growth initiatives, including new product development and broadening its distribution network. (Company reports; FoodBev.com, 1/18/23)

Korea’s Lotte Confectionery is investing $55 million over the next five years to expand its Indian ice cream subsidiary, Havmor Ice Cream. The project centers on a new 650,000 sq. ft. manufacturing plant in Pune, Maharashtra. Havmor operates 216 ice cream parlors in India. … Nestlé Health Science is spending $43 million to add two new production lines to its Eau Claire, Wisconsin, manufacturing plant for ready-to-drink beverages. The facility produces an array of medical nutrition products and nutritional drink brands such as BOOST and Carnation Instant Breakfast. (Leader-Telegram, 1/25/23; FoodBev.com, 1/19/23)

February

Saputo announced a series of capital investments and related consolidation plans impacting facilities in California and Wisconsin. The company is building a C$240-million (about US$180 million) greenfield cut-and-wrap facility in Franklin, Wisconsin. The plant, slated to be fully operational by the third quarter of 2025, will become the center of the company’s Midwest cut-and-wrap operations. Saputo plans to transfer regional cut-and-wrap activities to the new Franklin site, resulting in the permanent closure of its Green Bay, Wisconsin, and Big Stone, South Dakota, facilities. Green Bay will shut down in the third quarter of fiscal 2025 and Big Stone will halt operations in the third quarter of fiscal 2024. In California, Saputo is investing C$75 million (about US$56 million) to convert its Bardsley Street plant in Tulare into a string cheese packaging facility. The plant was previously a cut-and-wrap site. Saputo expects the facility to be operating at full capacity by the third quarter of 2025. In conjunction with the conversion, the company will permanently close its South Gate, California, facility in the fourth quarter of fiscal 2025.

Danone is exploring strategic options for its organic dairy activity in the U.S., including a potential sale. The company said its Horizon Organic and Wallabybusinesses “fall outside our priority areas of focus.” … Hong Kong-listed Vita International exercised its option to buy a 49% stake in dairy alternative manufacturer Vitasoy Australia. Vita paid Vitasoy Australia co-owner Bega Cheese A$51 million (about US$36 million) to acquire the outstanding shares. Bega said it would seek other ways to re-enter the dairy alternative category. … New York-based infant nutrition company ByHeart purchased DairiConcepts’manufacturing plant in Allerton, Iowa. DairiConcepts is a wholly-owned subsidiary of Dairy Farmers of America (DFA), which said it looked forward to continuing to work with ByHeart. The acquisition triples ByHeart’s supply capacity, “strengthening the vulnerable infant formula supply chain in this country,” the company said. For more, see this press release. (Company reports; Sydney Morning Herald, 1/30/23)

FrieslandCampina CEO Hein Schumacher will step down effective May 1, 2023, to lead multi-national food and personal care company Unilever. Schumacher will replace retiring CEO Alan Jope on July 1 after a one-month handover period. FrieslandCampina has initiated an accelerated process to select a new leader. … Anchor Food Professionals, owned by New Zealand’s Fonterra Co-operative Group, signed a deal with Walmart China to provide a lineup of new bakery products to 400 Chinese stores. The products, which are made using Fonterra ingredients, include a New Year’s cream cake, Basque cheesecake and a Swiss roll. (USDEC China office; Company reports)

China’s Junlebao plans to spend $442 million to build a dairy processing facility and three dairy farms in the Yangtze River Delta region. The project will support the government’s school milk program. The company expects to begin construction in March. Separately, Junlebao purchased a 10% stake in cheese manufacturer Shanghai Laoshen Health Technology Development Co. and plans to build a cheese factory this year, with an eye toward becoming one of China’s top cheese manufacturers over the next five years. (USDEC China office)

On Jan. 31, Japan’s Meiji began production at the first of three new facilities set to open in China this year. The fluid milk/yogurt processing plant is in Tianjin, China. … McDonald’s plans to open 900 new units in China in 2023. It has increased store openings for the past two years: 480 in 2020, 660 in 2021 and 700 in 2022. It currently operates more than 5,000 stores in China. … Malaysia-based investment group Wellspire Holdings is looking to import dairy beverages, including yogurt and UHT milk, as part of an effort to expand business in Thailand. … Danone opened a new research and innovation center at its Paris-Saclay campus in France. The facility, with a staff of more than 550, pilot plants and labs, will focus on “fresh dairy and plant-based products” and mineral water. (USDEC China office; USDEC Southeast Asia office; Company reports)

Fonterra Co-operative Group rolled out two new functional dairy products in Thailand through an exclusive partnership with 7-Eleven. Anchor Actif-Fiber and Anchor Beaute are being sold at more than 14,000 7-Eleven stores across the country. Actif-Fiber is fortified with fiber to aid digestion. Beaute contains zinc and collagen and is being marketed as an “ingestible beauty” product that Fonterra says provides “an inside-out kind of glow.” (USDEC Southeast Asia office; Company reports)

Subway confirmed that it is exploring selling its business and hired JPMorgan Chase to advise as it looks for potential buyers. Subway has 37,000 stores worldwide. Wall Street Journal estimates a sale price of about $10 billion. … The Seoul High Court upheld a lower court’s ruling and ordered Korean dairy processor Namyang Dairy to abide by a 2021 deal to sell a majority stake (53%) in the business to private equity firm Hahn & Co. Namyang’s owners claimed the deal was invalid just months after they made it, prompting Hahn to file the lawsuit. (Wall Street Journal, 2/14/23; Korea Herald, 2/9/23)

FrieslandCampina is consolidating its butter production in the Netherlands. The company said that increased cream demand from the foodservice channel created a structural overcapacity in butter. FrieslandCampina plans to expand its Lochem plant and merge all butter production to that location, closing its ‘s-Hertogenbosch facility in mid-2025. … China’s Terun Dairy is raising funds to build a $145-million dairy processing plant in the Xinjiang Autonomous Region in northeast China. The facility will focus on shelf-stable dairy products. (USDEC China office; Company reports)

Saputo is spending A$20 million (about US$14 million) to add cream cheese manufacturing to its Smithton, Tasmania, manufacturing plant. The new capacity replaces cream cheese operations at Saputo’s Maffra, Victoria, plant, which the company shuttered last week. (It announced the planned closure last November.) Saputo CEO Lino Saputo Jr. said that he expected more plant closures in Australia due to the country’s shrinking milk supply, “but there will be heavy investments as well in other facilities to focus on higher valued categories of dairy products that we can sell domestically and around the world.” (Just Food, 2/17/23; ABC News, 2/15/23)

Saudi Arabian dairy processor Almarai completed the acquisition of International Dairy and Juice Ltd. (IDJ) from its former joint-venture partner PepsiCo. The company paid an estimated 255 million riyals (about US$68 million) for PepsiCo’s 48% share in IDJ. Almarai said that full ownership would facilitate expansion efforts. … Malaysian distributor Farm Fresh paid RM84 million (about US$19 million) for a 65% stake in ice cream chain The Inside Scoop. The company plans to pursue brand collaboration between The Inside Scoop and its Jom Cha boba tea and soft-serve chain. … German regulators will only permit German dairy processor Theo Müller’s purchase of FrieslandCampina’s German dairy business if it divests two of the Dutch dairy giant’s brands. Müller said it is already in talks to sell the Tuffi and Landliebebusinesses. (USDEC Southeast Asia office; The National News, 2/19/23; New Straits Times, 2/16/23)

Fonterra Co-operative Group COO Fraser Whineray is resigning at the end of Fonterra’s fiscal year on July 31. … Lactalis is facing criminal charges in France related to a 2017 salmonella outbreak linked to its infant formula that sickened more than 40 children in Europe and impacted Lactalis formula distribution in 80 countries. Prosecutors contend that the company failed to properly carry out a product recall and withdrawal. (Company reports; DairyReporter.com, 2/20/23; Food Safety News, 2/18/23)

March-Jul-01-2023-04-38-10-7925-PM

Leprino Foods signed a non-binding agreement to take full ownership of Glanbia Cheese, the European joint venture it operates with Ireland’s Glanbia plc. Leprino will initially pay €160 million (about US$170 million) for Glanbia plc’s stake, with additional contingent consideration of €25 million (about US$26 million) over the next three years, depending on business performance. The deal includes manufacturing plants in Llangefni, Wales; Magheralin, Northern Ireland; and Portlaoise, Ireland. Current Glanbia Cheese CEO Paul Vernon will continue to head the business. “Having successfully partnered with Glanbia since 2000, we are proud of the high-quality business that we have helped build,” Leprino President and CEO Mike Durkin said. “We look forward to working with Paul Vernon and the local team to ensure a seamless transition for our employees, customers and suppliers. We intend to take advantage of our combined expertise, knowledge and strengths to further enhance the business and are committed to ongoing investments in the core capabilities and the talented people that set us apart from our competition.”

Vertically integrated Qatari dairy manufacturer Baladna formed a strategic partnership with French cheesemaker Bel Group. Baladna will begin producing Laughing Cow jarred cheeses this year under the terms of the agreement, but more Bel products are reportedly slated for production “in the near future.” Baladna said the deal will help reduce imports and the potential supply chain disruptions and eventually increase product options for regional consumers. (USDEC Middle East/North Africa office; Company reports)

Australia’s Bega Cheese is closing its Griffith, Canberra, manufacturing plant following a review of its fresh dairy operations in the Australian Capital Territory and New South Wales. Declining farm numbers and milk production made supplying the facility inefficient and unsustainable. The closure follows the recent shuttering of Saputo’s Maffra, Victoria, plant and Saputo CEO Lino Saputo Jr.’s prediction that he expected more plant closures in Australia due to the country’s shrinking milk supply. (FoodBev.com, 2/27/23)

Fast-food player Wendy’s signed a deal with India’s Rebel Foods to scale up the restaurant’s presence in India. Rebel will become the master franchisee, with plans to develop about 150 units over the next decade. Wendy’s originally partnered with Rebel in 2020 to build and operate 250 cloud kitchens across India to grow a home-delivery business in the country. (Bloomberg, 2/27/23)

FrieslandCampina Engro Pakistan signed a partnership with Dubai-based trading company Engro Eximp FZE. The deal aims to expand FrieslandCampina Engro dairy exports to the UAE and the broader Middle East region. … McThai Co., the operator of McDonald’s restaurants in Thailand, is spending 300 million baht (about US$9 million) to open 10-15 new outlets this year, pushing its total number of units to 237-242. (USDEC Southeast Asia office; PKrevenue.com, 2/23/23)

Spanish dairy processor Calidad Pascual partnered with Angolan beverage company Refriango on a new milk manufacturing facility in Angola’s capital city of Luanda. Pascual has been exporting yogurt to Angola for 25 years, but this is its first Angolan production plant. It will reportedly produce UHT milk and milk powder. Pascual said it expects to raise international revenues to €125 million a year (about US$134 million) in three years through the Angolan investment as well as capacity expansion projects in South and Central America. (Company reports)

New Zealand’s second-largest dairy processor, Open Country Dairy, named Mark de Lautour as its new COO, replacing Steve Koekemoer. Koekemoer is taking over as COO of Talley’s Group, the parent company of Open Country and meat processor Affco. De Lautour is presently the general manager of sales and marketing at Affco. (Rural News Group, 3/15/23)

Domino’s China has aggressive expansion plans. The company expects to open 180 outlets in 2023, 240 in 2024, 200 in 2025, and 300 in 2026. The company currently operates more than 600 stores in 17 Chinese cities. … Fraser & Neave Holdings (F&N) secured exclusive rights to manufacture and market Nestlé’sBear Brand sterilized milk in Cambodia until 2037. The new deal expands F&N’s existing contract with Nestlé, under which it makes and distributes Nestlé’s Bear Brand sterilized milk and Bear Brand Gold milk for Thailand and Laos. … Saputonamed Frank Guido president and COO of Dairy Division (USA), and Haig Poutchigian president and COO, of Dairy Division (Canada), effective April 1, 2023. … Olam Food Ingredients says it is on track to complete Stage 1 of its new Tokoroa, North Island, New Zealand powder plant in the second half of 2023. The plant will begin with WMP production, but Olam is already moving forward with Stage 2, which would focus on specialized, high-value protein-based ingredients. … Leprino Foods selected Illinois-based ingredient distributor Univar Solutionsas an authorized distributor of Leprino nutritional ingredients and dairy products in Canada and the United States. … Australian co-op Norco is one of the latest dairy processors to enter the plant-based dairy alternative categories. The company launched pea- and oat-based beverages under the P2 Pea Protein Mylkand Oat Mylk brands, respectively. It is marketing the products in Australia. (USDEC China office; USDEC Southeast Asia office; Company reports; Just Food, 3/13/23; Rural News Group, 3/8/23)

FrieslandCampina’s ingredients arm opened a new lactoferrin manufacturing facility in Veghel, Netherlands. The plant quadruples the company’s total lactoferrin capacity to 80 MT annually. FrieslandCampina said it built the facility to meet rising global demand in early life and adult nutrition markets due to lactoferrin’s reported immunity-enhancement properties. Separately, FrieslandCampina appointed Jan Derek van Karnebeek as the company’s new CEO. Van Karnebeek is currently CEO of GreenV, an international group of operating companies active in the horticultural sector, but spent most of his career at Heineken in commercial, marketing and management positions. He will begin on June 1, replacing Hein Schumacher, who is leaving the company on May 1 to become the new CEO of Unilever. (Company reports)

Suntado LLC, a partnership between Idaho dairymen Jesus Hurtado and Dick Reitsma, began construction on a $150-million, 190,000-square-foot dairy processing facility in Burley, Idaho. Dairy West is partnering with Suntado to help the company get to market with products that meet shifting consumer demands. When completed in the spring of 2024, the facility will be able to process up to 450 MT of milk per day. The plant will open with six production lines making ESL and UHT conventional and organic dairy beverages and related products. Future plans call for up to 18 production lines. Former Glanbia USA CEO Jeff Williams is heading the company. (Ag Proud Idaho, 3/20/23; Capital Press, 3/18/23; KLIX, 3/16/23)

Oregon-based Tillamook County Creamery Association purchased the former Prairie Farms ice cream plant in Decatur, Ill. Tillamook reportedly plans to spend $50 million to retrofit the facility and acquire adjacent property for future expansion. (Company reports; Herald & Review, 3/16/23)

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Swiss cheese manufacturer Emmi is looking to capitalize on rising global demand for goat’s milk powder. The company formed a new division—Emmi Nutrition Solutions (ENS)—focused exclusively on goat’s milk powder manufacturing, new product development and marketing. ENS consolidates activities of Emmi’s AVH dairy trading business and manufacturer Goat’s Milk Powder. The company is backing the venture with a new CHF40 million (about US$44 million) goat’s milk powder manufacturing facility in Etten-Leur, Netherlands. In addition to infant formula, Emmi plans to expand its goat’s milk powder portfolio to a range of products, including special nutrition for adults and seniors and products targeting consumers seeking healthy and active lifestyles. (Company reports)

Wisconsin-based Grande Cheese purchased the former Foremost Farms cheese plant in Chilton, Wisconsin. Grande operates eight other manufacturing facilities in the state. … Saputo is selling fresh milk processing facilities in Australia to retailer Coles Group for A$95 million (about US$64 million). Saputo called the sale an important step in executing its long-term vision for success in Australia. … German dairy processor Hochwald is buying the Tuffi brand from Müller Group and seeking to purchase the Landliebe label as well. German regulators required Müller to divest the brands as part of its deal to purchase portions of FrieslandCampina’s German consumer dairy business. (Company reports; Post-Crescent, 3/29/23)

PT Kian Mulia Manunggal, a division of Indonesian conglomerate TempoScan Group, opened a new milk powder plant in Cikarang, West Java. The plant will produce inputs for TempoScan’s infant formula and growing milk businesses. (USDEC Southeast Asia office)

France-based Savencia Fromage & Dairy purchased Argentine dairy manufacturer Sucerores de Alfredo Williner and its Ilolay dairy brand. Williner was founded in 1928 in Santa Fe Province, the heart of Argentina’s dairy region. The company operates three manufacturing plants producing cheese, fluid milk and cream, milk powder, butter, yogurt, dulce de leche and desserts. Savencia said the acquisition expands its existing portfolio of brands and strengthens its presence in Argentina. (Company reports)

French dairy giant Lactalis officially opened a new US$8-million milk powder dryer at its Bonnievale cheese plant in Western Cape Town, South Africa. It added the dryer to serve rising local demand for milk powder and projections for 6% annual growth through 2028. The facility also reinforces the commitment Lactalis has made to the country, the company said. Over the past four years, Lactalis has invested an average of 400 million rands (about US$22 million) per year in South Africa. (Food Business Africa, 4/6/23; Consulate General of France)

Danone China and Qingdao University opened a new innovation center to focus on research into gut health, early-life nutrition and healthy aging with an emphasis on the specific needs of Chinese consumers. The Qingdao University–Danone Nutrition and Health Innovation Centre will utilize resources from the university’s School of Public Health, Institute of Nutrition and Health, and its analysis and test capabilities, combined with Danone Open Science Centre’s research and innovation capabilities. The partnership is the latest in a series of relationships Danone is cultivating with Chinese universities. Since 2020, the company has published 37 scientific papers and reports together with local Chinese health and research institutes. (NutraIngredients-Asia.com, 4/11/23)

Papa Johns International signed a 10-year development deal with UAE-based PJP Investments Group to open 650 Papa Johns outlets in India. PJP already operates 100 locations in the Middle East, with plans to open 250 more over the next decade. The first Indian location is slated to debut in 2024. … Two Malaysian companies—ag investment firm Kulim (Malaysia) and A2 Fresh Holdings, a subsidiary of investment firm Rhone Ma Holdings—are reportedly moving forward on a joint venture dairy business. The new company, Jemaluang Dairy Valley in Johor, will be a vertically integrated operation, including dairy farming, processing and marketing. … China’s Behai Dairy (also known as Hokkai Pastures) completed a new $146-million dairy manufacturing plant. The facility can produce more than 150,000 MT of shelf-stable and refrigerated dairy products per year. Behai was founded in 2018 and focuses on yogurt products. … Singapore-based Hao Food is looking to expand the White Rabbit ice cream brand throughout Southeast Asia. The ice cream was developed through a partnership between the owner of the iconic White Rabbit candy brand, Shanghai Guan Sheng Yuan Food, and China’s Bright Dairy. Hao Food is the official regional distributor, rolling the line out in Singapore in 2021, and says it is exploring inquiries to launch in Indonesia, Malaysia and Vietnam. (USDEC Southeast Asia office; USDEC China office; The Malaysian Reserve, 4/6/23; Restaurant Business Online, 4/5/23; DairyReporter.com, 3/27/23)

Singapore-based Growtheum Capital Partners paid US$100 million for a 15% stake in Vietnam’s International Dairy Products (IDP). Growtheum said the deal would allow the company “to participate in Vietnam’s rising consumption story.” IDP manufactures drinking yogurt, fluid milk and other products and posted sales of about US$260 million last year. … Vilkyškių Pieninė, the parent company of Lithuanian dairy business Vilvi Group, acquired the remaining 30% stake of Latvian dairy processor Baltic Dairy Board (BDB). The company originally purchased 70% of BDB in 2018. BDB manufactures SMP, MPC and other products and Vilkyškių Pieninė said it made the deal to bolster Vilvi Group’s value-added dairy ingredient portfolio. (FoodBev.com, 4/17/23; Bloomberg, 4/12/23)

China’s Yili Group expects to begin trial runs at its new processed cheese factory in Hohhot, Inner Mongolia, this month. The $292-million project will reportedly produce 30,000 MTs of mainly lollipop-shaped cheese per annum. The plant is Yili’s largest cheese project to date. … Chinese dairy processor Junlebao officially opened its new pasteurized milk plant in Henan Province. The $146-million facility can reportedly produce 96,000 MT of pasteurized milk per annum. (USDEC China office)

Nestlé and private equity firm PAI Partners are forming a joint venture for Nestlé’s frozen pizza business in Europe, which distributes pizzas under the Wagner, Buitoni and Garden Gourmet brands. Nestlé will retain a non-controlling stake in the venture. The business will be headquartered in Germany, with manufacturing facilities in Nonnweiler, Germany, and Benevento, Italy. Nestlé’s pizza operations elsewhere are not part of the deal. Nestlé previously teamed up with PAI to create global ice cream maker Froneri in 2016. (Company reports)

Chinese importer and food processor Pinlive Foods says it is building a natural cheese manufacturing plant in Shanghai. It claims the facility will be ready for production by the end of the year. … Coca-Cola and Mengniu Dairy are reportedly running into challenges marketing Fairlife milk in China, which they jointly launched in September 2021. Online marketplaces JD.com and Tmall, and many convenient stores in Beijing, have stopped selling the product due to slower-than-expected sales. Reports suggest a lack of consumer understanding about the product’s ultrafiltration process and its higher price point might be the issue. (USDEC China office)

May-Jul-01-2023-04-41-20-4537-PMNew Zealand dairy processor Westland Milk Products is building a new NZ$70-million lactoferrin plant (about US$43 million) at its South Island facility at Hokitika. Westland, owned by China’s Yili Group, said the investment would more than triple its lactoferrin capacity (currently 20 MT per year) and make the company one of the top three lactoferrin producers in the world. It expects to begin construction in the first half of 2024 and estimates that the plant will take about 16 months to complete. The facility will produce spray-dried lactoferrin, while Westland’s existing lactoferrin supply is produced via freeze-drying. The investment follows a NZ$40-million expansion (about US$25 million) at Hokitika that doubled butter production. (Company reports)

New Zealand’s Fonterra Co-operative Group opened a fifth new application center in China. The latest location—in Shenzhen in southern China—will concentrate on beverage applications, whereas the previous four units focus on food. “Part of the success of our foodservice business in China has been driven by the application centers, which allow us to better support our customers and better understand Chinese consumer preferences,” said Fonterra Greater China chief executive Teh-han Chow. (Stuff.co.nz, 4/25/23)

China’s Junlebao, in cooperation with local government, is investing $434 million to build a new fluid milk, dairy beverages and yogurt plant in Jiangmen, Guangdong Province. The facility will supply six provinces: Guangdong, Guangxi, Hunan, Jiangxi, Fujian and Hainan. … Israeli regulators approved Remilk’s lab-grown protein for food use. The approval follows an agreement made last year between Remilk and Central Bottling Co. (the Israeli franchisee for Coca-Cola) to produce a line of dairy products made with the protein. (USDEC China office; Company news)

New Zealand’s Fonterra Co-operative Group signed a two-year milk powder manufacturing deal with Australia’s Halo Food Co. and its Kiwi subsidiary Keytone Enterprises. Under the terms of the agreement, Keytone will make nine Fonterra milk powder SKUs for sale in China, India, Vietnam, New Zealand and other countries over the two-year contract term. In other Fonterra news, the co-op announced last month that it was closing its office in Egypt after 30 years of operation. The company cited global macroeconomic challenges and its recent decision to exit the Fonterra Consumer Brands business in Egypt. It will continue to service customers in the country from other offices in the Middle East and Africa. (Company reports; edairy news, 4/16/23)

Mexican dairy and food manufacturer and distributor Sigma Alimentos acquired a majority stake in California-based Hispanic cheese and cream manufacturer Los Altos Foods. Sigma Alimentos said the deal, which includes Los Altos’s manufacturing plant near Los Angeles will allow it to meet rising U.S. demand for Hispanic cheese. (Company reports)

Irish dairy and flavor manufacturer Carbery Group opened a new innovation hub in Singapore to serve the greater Asia region. The company said the Carbery Group Asia Business and Innovation Center will foster stronger collaboration with industry partners, start-ups, universities and key customers. … Coca-Cola is building a new $650-million milk processing plant in Webster, N.Y., to make Fairlife brand fluid products. It expects commercial production to begin in the fourth quarter of 2025. (USDEC Southeast Asia office; Company reports)

Dairy Queen is reportedly accelerating expansion plans for China and looking to enter new markets like Australia and Taiwan. The company currently operates about 1,250 units in China, its second-largest market after the U.S. It opened 165 Chinese stores in 2022 and expects to exceed that number this year. … Cacique Foods held a grand opening of its new 200,000 sq.ft. Hispanic cheese and crema manufacturing plant in Amarillo, Texas. The plant will begin production this summer. (USDEC China office; Inside Retail, 5/12/23; News Channel 10, 5/11/23)

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Kerry Dairy Ireland and Dairygold Health and Nutrition are highlighting nutrition in their latest new products targeting Chinese consumers. Kerry’s Origimel is an adult milk powder that features what Kerry calls “science-backed ingredients” to support muscle, bone and cognitive health and boost immunity. The company is targeting “aging consumers who are seeking nutritional beverages to maintain and improve their health.” Kerry cited a growing opportunity for fortified products in China as that country’s middle class continues to expand. Dairygold is expanding its Aerabo range of milk powders in China with Aerabo Light, Aerabo Boost and Aerabo Vitality, targeting young professional adults, older health-conscious consumers and adults with active lifestyles. The company says that the products contain “higher values” of the essential amino acid tryptophan, vitamin B2 (riboflavin), conjugated linoleic acid (CLA) and provitamin A, as well as tocopherols and beta carotene. Dairygold launched original Aerabo WMP in China in 2021. (Agriland, 5/17/23, 5/19/23)

Ireland’s Kerry Group opened a new innovation hub in Wageningen University’s “Food Valley” in the Netherlands. The facility will focus on clean-label and food waste technologies. … New Zealand dairy processor Mataura Valley Milk (MVM), which is owned by New Zealand’s A2 Milk Co., is seeking a new chief executive after Bernard May stepped down from the role in May. John Roberts was appointed interim CEO and will oversee MVM’s focus on developing its infant formula manufacturing business. … Qatari milk producer and dairy processor Baladna continues to broaden its global footprint. The company signed Memorandums of Understanding with two Indonesian agribusiness companies to cooperate on milk production initiatives. The joint efforts will aim to identify, assess and initiate projects to bolster Indonesian milk output and processing and strengthen food security. … Arla Foods inaugurated a €10-million dairy farm (about US$11 million) in Kaduna, Nigeria. Arla said the farm—a joint effort between the company, the Nigerian government, non-governmental organizations and the local farming community—will serve as a hub of dairy farming knowledge and “symbolizes the massive potential we see in Nigeria.” (USDEC Southeast Asia office; FoodBev.com, 5/30/23; Food Ingredients First, 5/18/23; New Zealand Herald, 5/9/23)

New Zealand’s Fonterra Co-operative Group formed a new, stand-alone corporate investment arm to incubate, scale and invest in new, innovative nutrition science businesses. Provisionally named Nutrition Science Solutions(NSS), the business will “incubate and scale a portfolio of disruptive ventures by developing solutions that combine science, nutrition and technology to make a real impact on human health,” Fonterra CEO Miles Hurrell said. NSS will seek out, partner and invest in global start-ups with emerging technologies and in novel market channels. Its first investment is a US$10 million minority share in California-based Pendulum, a biotech company focused on developing microbiome-targeted products that advance metabolic health. Together, Fonterra and Pendulum say they will seek to establish a presence in global markets by co-developing and commercializing next-generation microbiome products that are scientifically formulated to make measurable improvements in people’s health. Weeks prior to the NSS announcement, Fonterra also rolled out a new effervescent powdered probiotic drink in Singapore under its Nurture Digestion+Immunity label. The company based the product on consumer research that indicated an interest in probiotic drinks (Southeast Asian consumers believe “that true wellness is impossible without a healthy gut,” Fonterra said) but with lower sugar content and a preference for effervescent beverages. The company is already looking to expand distribution to Indonesia, Malaysia and Thailand. Fonterra has been increasingly active in functional products over the past year—with varying degrees of success. A positive reception to ready-to-drink Nurture Digestion+Immunity beverages in Singapore in 2022 spawned the new powdered, effervescent product. Earlier this year, it also rolled out a line of Anchor Actif-branded products in Thailand. However, Fonterra’s BioKodeLab supplement line launched last October has already been “put on hold.” (USDEC Southeast Asia office; Company reports; DairyReporter.com, 5/23/23)

New Zealand dairy processor Synlait plans to sell Dairyworks (its cheese products division) and Talbot Forest Cheese (a related consumer business unit). Synlait acquired both New Zealand businesses in 2019 in transactions valued collectively at about NZ$150 million (about US$92 million today). Synlait said it is narrowing its businesses to focus on its highest margin segments: B2B advanced nutrition and foodservice. (Radio New Zealand, 6/6/23)

Subway reached an agreement with Chinese master franchisee Shanghai Fu-Rui-Shi Corporate Development to open 4,000 new sandwich shops across China over the next two decades. It is the largest franchise agreement in Subway’s history. There currently are around 500 Subway stores in China. … California-based Flynn Restaurant Group plans to buy Pizza Hut Australia, including the franchise license for the entire country. Australia-based investment firm Allegro Funds currently owns Pizza Hut Australia. Flynn operates about 950 Pizza Huts in the U.S.; the deal—its first outside the United States—will give it another 260. … Mars Inc. is aiming to grow its global ice cream business from $400 million in sales to $1 billion by 2030. Mars said it is eyeing growth in places where it already has ice cream factories, as well as in emerging markets. “Ice cream is about a $80 billion category around the globe, and it’s going to be about $100 billion by 2030,” said Anton Vincent, president of Mars Wrigley in North America and who recently took over global ice cream responsibilities. (Nation’s Restaurant News, 6/7/23; Reuters, 6/6/23; Bloomberg, 5/24/23)

China’s Yili Group and New Zealand’s Olam Food Ingredients (OFI) each expect to bring new plants online over the next two months. Yili is finishing a $138-million infant formula expansion at its Tianjin manufacturing plant. The new line, set to open in July, can produce up to 24,000 MT of semi-finished products per year. OFI expects to open Stage 1 of its new NZ$100-million-plus milk powder plant in Tokoroa on New Zealand’s North Island in August, prior to the 2023/24 milking seasons. The facility will reportedly produce up to 10 MT of powder per hour. Stage 2, which will expand operations to higher-value, functional protein products, should be up and running for the 2025/26 season, the company said. Rumors in New Zealand farming circles suggest OFI is already contemplating a second plant on the South Island, although the company has not publicly stated such intentions. OFI rival Fonterra Co-operative group cautioned that OFI’s plans could lead to excess processing capacity plant closures, given expected declines in New Zealand milk production in the years ahead. (USDEC China office; New Zealand Herald, 6/24/23)

Vinamilk announced it is joining six global nutrition and bioscience companies in a strategic partnership designed to further its mission of providing “international quality” nutritional solutions to Vietnamese children. Companies joining the Vietnamese dairy processor in the initiative include DSM, Chr. Hansen, Beneo, Gnosis, AAK and Kanematsu. Vinamilk CEO Mai Kieu Lien said the partnership will help the company further its commitment to leveraging modern production processes, scientific research and international cooperation to provide Vietnamese children with high-quality nutritional products. (FoodBev.com, 6/19/2023)

Ireland’s Dairygold Health and Nutrition (a business of Dairygold Co-operative Society) acquired a majority stake in Vita Actives Ltd. Vita Actives, also based in Ireland, is a manufacturer, supplier and distributor of bulk nutraceuticals and food-grade ingredients for dietary supplements. Dairygold said the deal positions the company well within the fast-growing life-stage nutrition segment. … Unilever is buying U.S.-based Greek frozen yogurt company Yasso Holdings to advance its position in the premium “better for you” frozen dessert segment. (Company reports; Agriland, 6/23/23)

Firehouse Subs, owned by Restaurant Brands International, signed a development deal to launch in Mexico later this year. The company did not name its partner in Mexico but said the deal, as well as a new store in Switzerland, are the first steps of a broad international push into the Middle East, Latin America, Asia, Europe and Africa. … Saudia Dairy and Foodstuffs (SADAFCO) signed a sales and export agreement with the Sultanate of Oman. SADAFCO, which produces dairy products, dairy alternatives, snacks, processed tomato products and other foods, did not provide information on which products were included in the agreement. The agreement aligns with the company’s efforts to expand its regional and export business. … Bongards Creameries is spending $125 million to increase milk handling capacity at its Perham, Minnesota, manufacturing plant by 30% to around 2,500 MT/day. The project includes expanding milk intake bays, cheese packaging, whey drying, packaging and warehousing, and wastewater treatment. Work is set to begin in July with completion expected in June 2025. (USDEC Middle East/North Africa office; Company reports; Perham Focus, 6/27/23)


Dairy innovation awards offer insights into new product trends
The 2023 World Dairy Innovation Awards were announced in June at Zenith Global’s 16th Annual Global Dairy Congress in London. While the awards are not a comprehensive round-up of new product innovation around the world, they are instructive in terms of product development trends taking place in some key U.S. dairy export markets, particularly China.

Health and nutrition claims continued to play a strong role among award winners and contenders, reflecting the continuing consumer focus on immune and digestive health. China-based Feihe Dairy’s award in the functional dairy category for its Aiben bovine colostrum milk powder highlights interest in the use of natural-based products as nutritional supplements to promote health and the immune system. Singapore-based CP-Meiji took home the prize in the “intolerance-friendly innovation category” with Lactose Free Dairy Milk with Malt.

Product1Feihe Dairy’s Aiben bovine colostrum milk powder

Other finalists in the functional dairy group included:

  • Zhennong High-Calcium Milk and ShuHua AnTangJian Sugar-Control Lactose-Free Milk from Chinese dairy giant Yili Group.
  • Feihe’s Aiben Lactoferrin Formula Milk Powder.
  • Japanese dairy processor Meiji Co.’s Fat-Fighting MI-2 Yogurt (which it claims reduces belly fat) and Probio R-1 Yogurt, which is fortified with iron and vitamin C.

Many award nominees and winners had innovative product configurations that fit the Congress’s theme of “reimagining dairy.” In the cheese category, Feihe’sZhuoran High-Calcium Cheese Lolly took top honors, with other finalists including Feihe’s Zhuoran High-Calcium Cheese Lumps and Yijiahao Cheese’s Double-Layer Cheese Lollipops (Yijiahao Cheese is a subsidiary of Yili). Yijiahao Cheese also took top honors in the children’s category with its Cheese Bomb cheese snacks in kid-friendly shapes.

Product2Yijiahao Cheese’s Cheese Bomb cheese snacks

Sustainability also continued to be an important industry touchpoint. For corporate social responsibility/sustainability initiatives, Yili earned finalist honors for its Satine A2 Beta-casein Organic Pure Milk, which Yili claims is China’s first net-zero carbon milk. Japan’s Meiji Co. was commended for its collaborative efforts with Ajinomoto to work with Japanese dairy farmers to reduce greenhouse gas emissions.

On the marketing side, Yili was a finalist in packaging for its Satine No Printing No Ink Environmentally-friendly Edition—where individual cartons of Satinemultipacks are almost completely white.

Product3Yili’s Satine No Printing No Ink cartons

For a full recap of winners, finalists and commended products, go to https://www.foodbev.com/news/world-dairy-innovation-awards-2023-winners/. (Company reports; FoodTalks, 6/25/23; FoodBev.com, 6/21/23)July 193477439

Two New Zealand dairy companies—Happy Valley Nutrition and Dairy Nutraceuticals—have reportedly run into financial troubles. The Bank of China appointed receivers to Dairy Nutraceuticals, which is majority-owned by Hong Kong-based Health Dairy International Ltd. Dairy Nutraceuticals produces a range of dairy products, including infant formula, adult milk powders and foods for special medical needs, out of its factory in Auckland. Separately, administrators were appointed to Auckland-based Happy Valley Nutrition after that company failed to raise sufficient funds to build a new infant formula and dairy nutrition factory in Ōtorohanga, Waikato. The company raised about NZ$13 million (about US$8 million) in an initial public offering but reportedly needed an additional NZ$350 million (about US$220 million) to follow through on its plans. Happy Valley cited high interest rates, a tighter New Zealand milk supply and China’s growing domestic milk supply as some of the reasons behind its stalled plans. The administrators said in a statement that they were undertaking “an urgent review” of the company. (Company reports; Stuff.co.nz, 7/5/23; BusinessDesk, 7/4/23)

Japanese dairy Megmilk Snow Brand announced a joint venture with Agrocorp International, a Singapore-based agricultural commodities company, to manufacture and market plant-based food ingredients. The collaboration, which will be based in Singapore, seeks to support sustainable food production in Asia in response to rising food demand in the face of tightening supply. Together, the companies will build a factory in Malaysia to produce pea protein, pea fiber and pea starch that can be used in plant-based meat and dairy products. Production is expected to begin at the end of 2025. (USDEC Southeast Asia office; Company reports; FoodNavigator-Asia.com, 7/4/23; Green Queen, 5/22/23)

Switzerland’s Emmi Group divested its organic dairy processor Gläserne Molkerei in northeast Germany to Mutares, a German holding company that specializes in turnarounds. The transaction is consistent with Emmi’s ongoing efforts to focus its portfolio on profitable strategic markets and niches, such as ready-to-drink coffee, specialty cheeses, premium chilled desserts and plant-based dairy alternatives. … Danone sold its 38% stake in Irish Organic yogurt maker Glenisk to the company’s founders, the Cleary family. (Company reports; FoodBev.com, 7/11/23)

French dairy cooperative Sodiaal appointed Antoine Collette as the company’s new CEO. Collette succeeds Jorge Boucas, who stepped down in February to lead French sugar group Tereos. … McDonald’s Korea expects to add 100 new stores by 2030, raising its total number of outlets in South Korea to 500. … Lactalis opened a new €2.4-million (about US$2.6 million) UHT addition to its plant in Gradačac, Bosnia and Herzegovina. The company expects to spend another €1.3 million next year to expand yogurt capacity at the facility. (Company reports; Just Food, 7/7/23; FoodBev.com, 7/5/23)

Hilmar Cheese Company has revealed a new look and corporate strategy, unifying its products under the brand name Hilmar while marking the integration of the company’s cheese and ingredients businesses. A news release explains that the new logomark features a milk droplet that’s being split into two products: cheese and whey ingredients. The design also reflects the concepts of nature, farmland and sustainability. “We take our role as stewards of the land and environment seriously,” said David Ahlem, Hilmar’s president and chief executive officer. Ahlem also said. “This new brand reflects our commitment to investing in technologies and processes that reduce our carbon footprint and make efficient use of all our resources.” “The new identity aligns with the company’s expanding role in the markets it serves,” said Ahlem. (Dairy Processing, Turlock Journal, 7/14/23)

Russia has taken control of the Russian subsidiary of French dairy group Danone,reports BBC News. The units have been put in “temporary management” of the state under a new order signed by Russian President Vladimir Putin. Danone was in the process of selling its Russian operations. Reuters reported on Monday that Danone is reviewing its legal options. (BBC News, 7/16/23; Reuters, 7/17/23)

Japanese milk producers Megmilk Snow Brand and Yotsuba Milk Products will expand dairy exports to Asian markets to secure new revenue streams as price hikes dent demand at home, reports this article by Nikkei Asia, a Japanese weekly news magazine. Megmilk will soon start exporting its “Hokkaido” brand long-life milk to Thailand. It already ships the product to Singapore, Taiwan, Hong Kong and Palau. Meanwhile, Yotsuba Milk Products plans to lift exports to Singapore by value by 20% every year. Milk packaged at its main factory in Hokkaido will be shipped to Taiwan, Malaysia and other markets. (Nikkei Asia, 7/18/23)

Denmark’s Arla Foods is teaming up with Blue Ocean Closures in a formal partnership to create a fiber-based cap for its milk products. This could be a first in the dairy industry and reduce Arla’s plastic consumption by more than 500 tons annually if implemented … Darigold has joined the Global Dairy Trade platform to better support its growth ambitions and create value for its farmer-owners … China’s Mengniu Dairy has been named an official sponsor of the FIFA Women’s World Cup 2023, which began on Thursday … Nestlé has introduced a new sugar-reduction technology, which uses an enzymatic process that can reduce intrinsic sugar in ingredients such as milk, malt and fruit juices by up to 20% …  China’s Shanghai Youchun Dairy signed a cooperative agreement to build a dairy processing project in Jinchang City in Gansu province capable of producing of 200,000 MTs of dairy products per annum … Seven-Eleven Japan Co. said it will launch a new brand of environmentally friendly prepared foods. The company will start selling the first four items of the brand this week. The items include a tuna mayonnaise “onigiri” rice ball whose tuna is partly replaced by pea protein. (Perishable News.com, 7/14/23; Dairy Reporter, 7/11/23; Sports Mint, 7/17/23; FoodBev Media, 7/1/23; USDEC China Office, 7/18/23; Jiji Press, 7/11/23)

With the pandemic seemingly in the rearview mirror, Western-based chain restaurants are once again moving to grow their international businesses. Here are a few recent highlights:

  • McDonald’s Corp. is spending more than A$1 billion (about US$677 million) over the next three years to add 100 new stores and refurbish more than 500 existing outlets in Australia.
  • Chipotle signed an agreement with Kuwait-based Alshaya Group to open two stores each in Dubai and Kuwait next year. the Deal is Chipotle’s first franchise agreement (all existing stores in the U.S., Canada and Europe are company-owned) and the stores will be the first in the Middle East. Alshaya is also a franchisee for other major U.S. restaurant brands, including Starbucks, and Shake Shack. Chipotle said the agreement could serve as a new model as the company looks to expand to other global markets.
  • Dine Brands is bringing its Applebee’s and IHOP chains to Japan (and a handful of EU countries) but not in a traditional manner. Dine is working with Georgia-based Franklin Junction, a company that specializes in matching restaurant brands with “host kitchens” and providing the technology to set up a delivery-only, virtual presence in the market. Dine said the new strategy will open new opportunities for IHOP and Applebee’s in key international markets.
  • Burger King’s Thai outlets rolled out a new sandwich it is characterizing as a “real cheeseburger.” Instead of meat and cheese on a bun, the “cheeseburger” contains up to 20 slices of cheese. The sandwich went viral on social media earlier this month and was reportedly selling well. Thai conglomerate Minor International, which runs more than 2,000 foodservice outlets in over 25 countries, operates the Burger King franchise in Thailand. (USDEC Southeast Asia office; Company reports; Bloomberg, 7/22/23; Restaurant Business, 7/19/23; CNBC, 7/18/23)

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Competition concerns have been raised in three pending dairy asset deals, causing anti-trust regulators to call for further investigation before allowing the deals to close. In Brazil, antitrust regulators are challenging Nestlé and Fonterra Co-operative Group’s planned sale of Dairy Partners Americas Brazil to Lactalis. Technical staff at the Council for Economic Defense (CADE) recommended that the regulator block the US$147-million deal because it would likely cause horizontal competition in the Brazilian dairy products market, particularly among the dairy desserts, fermented milk and petit-suisse categories. CADE’s court will conduct a broader review of the deal before voting on its approval. In Ireland, regulatory authorities announced they will conduct a full Phase 2 investigation of the proposed acquisition by Aurivo Consumer Foodsof certain assets of Arrabawn Co-Operative Society. The Competition and Consumer Protection Commission (CCPC) said a full investigation is needed to ensure the proposed deal, in which Aurivo would acquire parts of Arrabawn’s business for the supply of branded and unbranded liquid milk, cream and butter products, does not lead to “a substantial lessening of competition in the State.” Australia’s Competition and Consumer Commission (ACCC) also identified competition concerns about a proposed deal for Coles Group Limited to acquire two fresh milk processing facilities from Saputo Dairy Australia. The ACCC cited concerns that the acquisition would give Coles, one of Australia’s largest grocery retailers, too much influence in the dairy supply chain. The watchdog is also considering whether the deal would limit competition, which could cause farmers to receive lower prices for their raw milk. (Reuters, 7/25/23; CCPC, 7/14/23; DairyReporter.com, 7/24/23)

USDEC brings you results highlights from recent half-year reports from major global dairy suppliers: 

  • Nestlé reported broad-based growth across most categories and regions. Dairy group sales rose at a high-single-digit pace, with strong demand for coffee creamers and affordable fortified kinds of milk. Middle East and Africa saw double-digit growth, with infant nutrition as the largest contributor, led by LactogenNAN and Cerelac. In Brazil, dairy posted double-digit growth, supported by fortified milks and dairy culinary solutions, while infant nutrition increased by double-digits as well, based on solid momentum for NAN and Nido growing-up milks. In China, infant nutrition saw mid-single-digit growth, led by NAN specialty offerings and illuma.
  • FrieslandCampina reported a “challenging” first half, citing “sharply declined commodity dairy prices and lower volumes.” One bright spot was the performance of specialized nutrition, which reported strong revenue and operating profit figures, partially driven by growth in infant nutrition sales under the Friso Prestige brand in the ultra-premium segment in China. (Company reports)

Leprino Foods expanded its relationship agreement with Illinois-based ingredients distributor Univar Solutions. Univar’s Mexican and Brazilian units will distribute Leprino’s nutritional ingredients and dairy products in their respective markets. Leprino said the deal “reinforces our commitments to the food ingredients and nutrition market.” Earlier this year, Leprino selected Univar as an authorized distributor for Canada and the United States. … Japanese probiotic beverage maker Yakult is building a $305-million production facility in Bartow County, Georgia. The company expects to commence manufacturing at the beverage plant in 2026. … Danone claims it remains the legal owner of its operations in Russia despite a Russian decree in July putting the business under “temporary management” of the government. The government justified that move with recently passed rules aimed at companies from “unfriendly” countries. Just prior to the takeover, Danone said it was localizing its Activia brand in Russia, renaming it AktiBio. A company spokesperson said, “What’s going to happen in the future? We don’t know.” (Company report; Al Bawaba, 7/29/23; FoodBev.com, 7/28/23; Bloomberg, 7/26/23)

Milk Specialties Global (MSG) has completed a new production facility in Jerome, Idaho, that will produce acid casein and rennet casein products for food and industrial applications. MSG says its new facility will process 2.5 million pounds of milk each day and offer North American consumers an “alternative supply of domestically produced casein products” … Lactalis Canada has agreed to purchase dessert manufacturer Marie Morin Canada for an undisclosed sum. The acquisition will see the Canadian division of Lactalis Group expand its presence in the dessert category, entering both the Canadian and U.S. markets. The move will complement Lactalis Canada’s extensive dairy portfolio, which includes cheese, table spreads, yogurt and fluid brands … South Korea’s Orion has joined with Thailand’s No. 1 milk beverage company Dutch Mill to enter Vietnam’s dairy market. Orion will first introduce two new product lines – Proyo! and Choco IQ – this month and launch others later … Dow and China’s Mengniu have partnered to introduce a yogurt pouch made entirely from polyethylene. The new packaging solution, which is designed for recyclability, allows previously “hard-to-recycle” packaging to be integrated into closed-loop recycling systems. (FoodBev.com, 8/4/23, 8/3/23; The Korea Times, 8/8/23, Food Bev.com, 8/9/23)  

Arla Foods Ingredients (AFI) inked a partnership with biological solutions company Novozymes to jointly develop protein ingredients using precision fermentation technology. The collaboration will initially focus on creating products for disease-specific medical nutrition, with expansion into other market segments expected in the future. “Collaborating with Novozymes fits perfectly with our ambition to explore alternative nutrition platforms and complement our portfolio of dairy and whey solutions,” AFI Group Vice President Henrik Anderson said. (Company reports)

Administrators for aspiring New Zealand-based infant formula manufacturer Happy Valley Nutrition have recommended that the board vote to liquidate the company. … Turkey-based quick-service restaurant operator TFI Tab Food Investments (parent company of Burger King (China) Investment Co.) plans to open 200-300 Burger King outlets in China per year moving forward. The company already runs more than 1,400 restaurants in 150 Chinese cities. … New York-based scoop shop Van Leeuwen Ice Cream is opening its first international outlet in Singapore through a partnership with Singapore-based lifestyle and food and beverage group Caerus Holding(USDEC China office; USDEC Southeast Asia office; Dao Insights, 8/8/23; Stuff.co.nz, 8/4/23)

Arla Foods Ingredients signed a new partnership agreement with Chinese ingredient and chemical distributor Zhongbai Xingye Food Technology (Beijing)Co., a unit of the Brenntag Group. The two companies have a 15-year relationship that includes a jointly funded Innovation & Application Center in Zhongbai’s Beijing facility to develop China-specific formulations. The new agreement expands their cooperative product development work and covers the full range of Arla’s ingredient products. “This agreement will help us adapt and make our offering to Chinese markets even stronger,” said Luis Cubel, Commercial Director of Arla Foods Ingredients. (Company reports)

Ongoing inflation and increased supply chain expenses continue to hinder companies across the globe as they release their most recent financial performance results: 

  • Glanbia plc reported first-half earnings that exceeded expectations, driven largely by the strong performance of its Glanbia Performance Nutrition (GPN) business. Group revenues for the company, which recently changed its financial reporting currency from the euro to the U.S. dollar, were $2.8 billion for the first half of 2023, down from $3.1 billion in HY 2022. But group EBITA (before exceptional items) grew 6.1% (constant currency). GPN revenue increased by 3.4% in HY 2023 versus the previous year. Based on its half-year results, Glanbia upgraded its full-year guidance to 12%-15% growth in adjusted earnings per share.
  • In its first quarter 2024 report, Saputo revenues fell 2.8% while net earnings rose 1.4% compared to the same quarter last fiscal year. Factors cited by the company as affecting the first quarter performance included the positive carryover effect of previously implemented pricing initiatives in all its sectors, lower average block market price and butter market price in the USA sector, and softening of the global demand for dairy products negatively impacting its sales volumes.
  • Bel Group revenues rose 6.3% in the first half of 2022. The company attributed the gain in part to sustained double-digit growth in China and strong performances by core brands, including Kiri and Boursin. Sales in China increased for the fourth consecutive year, driven in part by the performance of Kiri cheese. Strengthening its presence there was Bel’s acquisition of a majority stake in China’s Shandong Junjun Cheese.
  • The second quarter 2023 results for Yum China showed record growth in total revenues and operating profit. The unaudited results show total revenues increased 25% to $2.65 billion, up from $2.13 billion in 2022. Total system sales increased 32% year over year, with increases of 32% at KFC and 30% at Pizza Hut. Same-store sales increased 15% year over year, and the company opened 422 new stores during the quarter. Net Income increased 138% to $197 million from $83 million in the prior year period, primarily due to a 216% increase in operating profit, which jumped to $257 million and has already surpassed the entire year for 2022. Company officials credited robust digital capabilities, an agile supply chain and special marketing campaigns for its strong performance, as well as strong sales on holidays including Children’s Day.
  • In its FY 2023 annual results, A2 Milk reported revenue for FY23 up 10.1% from the previous year and net profit growth of 26.9%. The company credited its China-focused growth strategy for the revenue increase. The China & Other Asia segment saw revenue rise 37.9%, and it exceeded NZ$1 billion (about US$594 million) for the first time. The gains came despite an overall decline in the Chinese infant formula sector of more than 10% in A2’s FY23. The company attributed the decrease to China’s declining birth rate, challenging macroeconomic conditions and increased competition. A2 said it expected another double-digit decline in China’s infant formula sector in FY24 but expected the company to still post low single-digit revenue growth. (USDEC China office; Company reports; Radio New Zealand, 8/21/23)

Glanbia plc’s Group Managing Director Siobhán Talbot announced plans to step down effective Dec. 31. 2023, and retire from the company in January 2024. Hugh McGuire, currently CEO of Glanbia Performance Nutrition, will take over as CEO of Glanbia plc effective Jan. 1, 2024. Talbot joined Glanbia plc in 1992 and has been managing director for the past 10 years. (Company reports)

Wells Enterprises is more than doubling its ice cream and frozen novelty manufacturing capacity at its Dunkirk, N.Y., facility. Construction will begin this fall. Wells is owned by Italian confectionery company Ferrero Group. … The Cheesecake Factory is set to open its first store in Thailand in December through its relationship with Hong Kong-based foodservice operator Maxim’s Caterers. The new store is located in Bangkok. Last fall, Cheesecake Factory and Maxim’s announced they planned to open 18 Cheesecake Factory locations in Thailand by 2028. (Company reports; Lifestyle Asia, 8/17/23) September-Dec-18-2023-06-09-16-2524-PM

Australia’s Bega Cheese paid A$11 million (about US$7 million) for certain assets of TasFoods Ltd.’s Betta Milk and Meander Valley Dairy businesses. The deal includes a perpetual, royalty-free license for Bega to use the Pyengana Dairybrand in Australia. (Company reports)

John Jordan, CEO of Irish dairy manufacturer and marketer Ornua, is stepping down to take on a new position as COO of a U.S.-based private equity firm. The Ornua board named current CFO Donal Buggy as interim CEO while it began a search for a permanent replacement. … McDonald’s Malaysia plans to spend more than US$40 million to open 36 new stores in Sabah, the Malaysian state on the island of Borneo. The company expects to complete the expansion by 2030, giving it 52 total stores in Sabah. … Tim Hortons China plans to open 1,700 Popeyes units in China over the next decade. (USDEC Southeast Asia office; USDEC China office; Company reports)

2022 was a good year for large companies in Rabobank’s Global Dairy Top 20. They had a combined turnover gain of 7.4% in U.S. dollar terms (based on 2022 sales, plus acquisitions completed by June 30, 2023.)  Favorable commodity prices, inflation and a tight dairy market were contributing factors. Yet, as Rabobank points out, the degree to which a dairy company’s revenues benefitted from price developments depended on a combination of its product portfolio, geographic presence and distribution channels. French dairy giant Lactalis held onto the No. 1 spot with an estimated turnover of $28.6 billion. Two U.S. companies made significant jumps on the list. Dairy Farmers of America moved from No. 4 to No. 2 – leaping over Nestlé and Danone — with a turnover of $24.5 billion. Schreiber Foods moved from No. 19 to No. 16. New Zealand’s Fonterradropped three spots from No. 6 to No. 9. To download the full Rabobank report, click here.  

Despite ongoing inflation, cautious optimism was a common theme among many companies looking ahead as they released their most recent financial statements: 

  • Arla Foods:  The numbers: Denmark-based Arla Foods’ revenue was up 10.7% compared to the first half of the previous year, but Arla saw net profit drop to 1.5% of revenue from 3.0% in the last half-year. Beyond the numbers: Arla predicts inflation will continue to influence consumer patterns—and put pressure on branded volumes in most markets—for the rest of 2023. But the company expects its branded-product growth numbers will climb again in the second half of this year. The commodity market, however, “continues to be marked by uncertainty,” Arla said. 
     
  • Bega Group: The numbers: For the full year ending in June, Australia-based Bega posted revenue growth of 12% from 2022, while EBITDA dropped 4%. Beyond the numbers: Now in the final phase of its transition to a predominantly branded business, Bega credits its brands for driving performance in the second half of its fiscal year. The company expects the majority of profit for the coming fiscal year will come from this branded segment.
  • Dutch Lady Milk Industries: The numbers: The Malaysia-based dairy processor reported a net profit increase of 12.7% in the second quarter that ended June 30, 2023. Quarterly revenue also increased 3.3% for the same period. Beyond the numbers: Dutch Lady says higher revenue was driven by strong demand and selective price increases designed to offset inflationary headwinds. 
  • Emmi Group: The numbers: Emmi’s first-half 2023 sales increased by 4.3% from the previous half-year, with net profit jumping 25.2%. Beyond the numbers: Emmi Group, based in Switzerland, credits its rebound from a challenging 2022 in part to the strength of its ready-to-drink coffee brands, such as Emmi Caffè Latte, as well as chilled premium desserts. 
  • Feihe Ltd.: The numbers: The first half of 2023 saw revenues tick up 0.6% from the previous year for the Chinese formula company. Gross profit for the same period decreased by 2.7%. Beyond the numbers: Feihe says it is dedicated to innovation in “fresh keeping” technology and expanding its business into formula and nutritional products covering the age cycle from infant to senior. In the first half of 2023, sales of its adult milk powder jumped 57% from the previous year. 
  • Mengniu Dairy: The numbers: Mengniu’s 2023 half-year revenue increased 7.1% compared to the same period the previous year, with an operating profit increase of 29.9%. Beyond the numbers: The China-based company saw liquid milk revenues increase 5% from the previous year, while its ice cream business revenue increased 10.5%. Its cheese segment, which is self-operated by its Shanghai Milkground Food Techbusiness, increased 310% compared to the same period last year—a jump attributed to the rising cheese demand in China.  
  • New Hope Dairy: The numbers: The China-based dairy supplier reported that revenues increased 10.8% in the first half of 2023. Net profit climbed 25.1% for the same period. Beyond the numbers: New Hope said it will continue to focus efforts on its pasteurized milk segment, which posted a revenue increase of more than 10% from the previous year. 
  • Panda Dairy Corp.: The numbers: For the first half of 2023, the China-based company’s revenue was up 18.3% year over year, and net profit leaped 107.1% for the same period. Beyond the numbers: The company attributes the growth to the active development of new channels and customers, including adding distributors for catering and establishing strategic partnerships with food companies. Looking ahead, it expects cheese and cream to be new growth categories.  
  • Yili Group: The numbers: China’s Yili saw a 4.3% increase in revenue for the first half of 2023, and net profit was up 2.9% over the previous year. Beyond the numbers: China’s largest dairy company credits its revenue growth to strong sales of infant formula and ice cream, both of which posted double-digit gains during the period. A company official said demand for liquid milk is also on the rise and that the slowdown in its milk powder business is showing signs of improvement. (Company reports; USDEC China office; Yicai, 8/29/23; The Edge Malaysia, 8/24/23) 

New Zealand-based dairy cooperative Fonterra is seeking US$596 million in cost savings, likely leading to the potential loss of jobs, reports an article in Just Food. “While this focus on efficiencies will have implications for staff numbers, we don’t want this to be at the expense of driving value growth,” CEO Miles Hurrell said in a letter to its farmer owners. The cost-cutting plan will be implemented over the next seven years. 

French cheese giant Bel Group offered its take on doing business in China in a recent piece in DairyReporter.com. The company said it tried for years to break into the China market by selling its Laughing Cow cheese cubes, all in savory flavors popular in other markets. But Bel realized Chinese consumers wanted sweeter cheeses. “As soon as we thought out of the box and integrated fruit juices to develop the fruity range, the products started doing extremely well,” said Gorge Bai, Bel China general manager, cheese. But that does not mean abandoning traditional product lines, Bai said. He recommended a dual approach: innovate to local tastes while simultaneously introducing tastes and products that might be new to the market. (DairyReporter.com, 8/29/23) 

Tillamook County Creamery Association is working with Golden West Food Group on “premium, restaurant-quality” frozen meals, which comprise three types of mac’n’cheese products and four frozen pizza flavors. It’s a new segment for Tillamook, which markets fresh products such as cheese, butter, spreads, ice cream and sour cream … Denmark’s Arla Food Ingredients has taken full control of MV Ingredients, with Volac exiting the joint venture, which has been in place for more than 10 years. MV Ingredients is a whey processing facility based at Arla Foods Ingredient’s Taw Valley creamery in the UK … HP Hood will expand its manufacturing operations at the Genesee Valley Agri-Business Park in Batavia, New York. The $120 million project is expected to create 48 jobs in Genesee County … Müller Yogurt and Desserts has launched Müller Corner Originals, bringing back favorites from the last 30 years. The first retro flavors from the English dairy company’s back catalog will be Mississippi Mud Pie Inspired and Strawberry and Choc Orange Balls. (Dairy Reporter, 9/4/23; Food Ingredients First, 9/4/23; Area Development, 9/4/23; FoodBev Media, 9/6/23)  

An international dairy development collaboration created to further the development of organic dairy production in Indonesia recently introduced that country’s first locally produced organic cheese. The launch is the result of a partnership between Denmark-based dairy cooperative Arla Foods and partners, including Indonesia-based dairy producer Mazaraat Artisan Cheese, the Indonesian government and the Danish Ministry of Foreign Affairs.The effort began with Indonesian farmers and other stakeholders making research trips to Denmark in 2018, where Arla shared its agricultural experience and best practices for organic dairy production. The organizations formed a partnership that went on to convert a number of conventional Indonesian farms to certified organic dairy producers. Mazaraat processed milk produced at those farms to become the country’s first organic cheese. The partnership was formed to meet Indonesia’s growing dairy demand. Roughly 80% of the country’s dairy consumption comes from imported products, and demand is expected to increase by 6% in 2023. The Indonesian government is also working to increase local organic food production from 2% to 20% by 2024. The cheese will be sold locally in hotels, cafés, and restaurants, and Mazaraat says it has inked its first export agreement with Singapore. (Company reports, 8/31/23)

Mengniu Dairy, China’s second-largest dairy company, said it believes increasing consumer demand will make innovation in protein products, especially in the ready-to-drink (RTD) beverage format, a key component to the country’s domestic dairy growth. At the Food and Beverage Innovation Forum in Shenzhen, China, Mengniu Nutrition and Health GM Ben Wu said the company believes RTD protein products will drive the dairy category as Chinese consumers seek the health and nutritional benefits of dairy across all life stages. Other factors Wu identified as contributing to the increased demand for protein products include the aging of Chinese society and a rise in the number of professional Chinese athletes. Wu also said opportunity areas exist around protein products with Chinese cultural significance and those with flavors catering to Chinese tastes. Mengniu recently launched its first range of locally produced RTD beverage line called M-Action, which features products targeted to men and women based on their genetic differences and activity levels. (DairyReporter.com, 9/6/23)

Solar Foods, a Finland-based food technology company, received funding worth €5.5 million (about US$5.9 million) from the European Innovation Council to work on a four-year project to develop an animal-free milk protein. The “Hydrocow project” will use genetic engineering to produce milk protein from carbon dioxide and electricity. Solar Foods and a consortium of European academic partners plan to build a protein production platform that will produce beta-lactoglobulin, the major whey protein in cow’s milk, and eventually convert carbon dioxide into ingredients including lactoferrin, casein, enzymes and other proteins. (Food Ingredients First, 9/6/23)

The receivers for New Zealand-based processor Dairy Nutraceuticals reportedly signed a deal to sell the company’s fixed assets, despite findings that its accounts “appear inaccurate.” They did not identify the buyer. Bank of China appointed receivers in July after Dairy Nutraceuticals breached its lending agreement. … U.S. cheese manufacturer Heartisan Foods acquired gourmet cheese spread maker North Country Packaging. Heartisan was formed by private equity firm Ronin Equity Partner in 20221 after Ronin acquired and merged the operations of Red Apple CheeseBarron County Cheese and e-commerce business Cheese Brothers. … Nestlé acquired a majority stake in Brazilian premium chocolate firm Grupo CRM. Grupo CRM operates more than 1,000 chocolate boutiques under the Kopenhagen and Brasil Cacau brands and has a growing online presence. (Company reports; FoodBev.com, 9/12/23; BusinessDesk, 9/5/23)

Chinese dairy processor Royal Group began construction on a $411-million buffalo milk processing plant in Anhui Province. … PT PepsiCo Indonesia Foods and Beverages broke ground on its first snack food manufacturing facility in Indonesia. The project marks PepsiCo’s return to the country after selling its stake in a 30-year snack-manufacturing joint venture two years ago. … Australian infant formula maker Bubs Australia named Reg Weine as its new CEO, replacing interim CEO Richard Paine. Paine took over for founder and CEO Kristy Carr who was ousted in May for reportedly failing to comply with “reasonable board directions.” (USDEC China office; USDEC Southeast Asia office; FoodBev.com, 9/1/23; Reuters 8/29/23)

French dairy giant Danone announced a new program created to identify and develop strategic partnerships to drive innovation, efficiencies and growth. The “Partner for Growth” program aims to leverage consumer trends and create growth opportunities in four strategic areas: emerging science and technology, precision capacity creation, cost competitiveness, and sustainability. The initiative is run through Danone Manifesto Ventures, the company’s corporate venture arm, and will target partnerships with organizations ranging from startups to major corporations and academic institutions. The first such alliances have already been formed and include a partnership with Arla Foods to supply specialty dairy ingredients, a relationship with Kansas-based McCarty Family Farms for pioneering regenerative agriculture practices, and a joint business development plan with Denmark-based bioscience company Chr. Hansen will work with Danone to innovate dairy and plant-based solutions designed to improve consumer health. (Company reports)

New Zealand’s A2 Milk Co. gave Synlait Milk written notice that it was canceling its exclusive infant formula supply agreement with the company, paving the way to move more production to A2’s own factory. Synlait has exclusive supply and manufacturing rights to A2 Milk’s Stage One, Two and Three infant milk formula products sold by A2 Milk in China, Australia and New Zealand. (Synlait makes other A2 products as well, though not exclusively.) A2 claims Synlait failed to live up to on-time performance provisions in the contract, allowing A2 to produce the products elsewhere. The original exclusivity deal runs through September 2027. Synlait is expected to challenge the deal’s cancellation and said it expects to continue to make the products through the life of the original contract. Despite moving to cancel the exclusivity provision, A2 said it expects Synlait to remain an important supplier to the company and that Synlait is contractually bound to provide a set volume of infant formula. (Stuff.co.nz, 9/18/23)

A new joint-venture dairy plant in Paide, Estonia, has produced its first cheddar cheese. Cross-border Estonian-Latvian dairy co-op SCE E-Piim, Netherlands-based Royal A-Ware and Interfood Group built the facility. Royal A-ware is responsible for the sale of cheese from the factory, while Interfood will handle the sale of whey powder and butter. … Ireland’s Competition and Consumer Protection Commission (CCPC) completed its investigation of Aurivo Consumer Foods’ purchase of certain assets of Arrabawn Co-operative Society and cleared the acquisition, finding that it would not substantially lessen competition. (Company reports; CCPC)

Danone is spending €50 million (about US$53 million) to expand the production of medical nutrition products at its plant in Opole, Poland. Specialized nutrition, which includes medical nutrition, accounted for about 30% of Danone’s total revenues and grew 10% in 2022. … Yum China Holdings revised this year’s new store opening target from 1,100-1,300 to 1,600, citing more predictable market conditions in the wake of the removal of COVID restrictions and resilience in China’s fast-food sector. It currently has around 13,600 units in China and is aiming for 20,000 by 2026. … Chinese milk producer Adopt A Cow is building an $87-million manufacturing facility in Hebei Province. The plant, when complete, will produce 150,000 MT of fluid milk per year. (USDEC China office; Company reports; Bloomberg News, 9/14/23)

Dutch dairy giant FrieslandCampina reorganized its business structure as part of a broader plan to boost profitability. The company split its Food & Beverage Business Group into five separate business units: Europe; Middle East, Pakistan and Africa; Asia; Retail and Americas; and Professional (combined with its Trading business unit). Ingredients and Specialized Nutrition remained as their own business units. Jan Derck van Karnebeeck, who took over as FrieslandCampina CEO in June, named a new executive team to lead each group. The executive team appointments take effect on Oct. 1, but the new business units will not be official until Jan. 1, 2024. (Company reports)

Singapore private equity firm Growtheum Capital Partners is growing its dairy portfolio. After sinking US$100 million in Vietnam’s International Dairy Productsearlier this year, the company invested a reported US$70 million in vertically integrated Indonesian dairy manufacturer KIN Dairy. Growtheum joins Mitsui & Co. as a backer of KIN, which operates one of the only A2-cow dairy farms in Indonesia. (USDEC Southeast Asia office; Deal Street Asia, 9/18/23)

Lactalis Canada is consolidating its Canadian cheese and table spread distribution operations into a new single distribution center in Oshawa, Ontario. The facility, occupying nearly 380,000 sq. ft., will be Lactalis’s largest-capacity distribution (by capacity) in the world. It’s slated to open in the fourth quarter of 2024. (European Supermarket Magazine, 9/21/23) October-Dec-18-2023-06-46-06-3370-PM

Olam Food Ingredients (OFI) significantly expanded its manufacturing plant in Johor, Malaysia. The project, which includes a new milk powder dryer and expansion of the OFI Ingredient Excellence Center (IEC), more than doubles the plant’s capacity to 90,000 MT of fat-filled milk powder and other dairy ingredients each year and will play a key part in serving the demand from customers in the Middle East, North Africa and Asia, the company said. The IEC is one of OFI’s global network of 15 innovation centers. The company says the expansion will allow it to focus on high-growth segments such as ready-to-drink beverages, premixes and blending lines, alongside its existing range of filled milk powder solutions. (DairyReporter.com, 9/28/23; FoodBev.com, 9/29/23)

European dairy giants FrieslandCampina and Arla Foods Ingredients are bolstering their whey processing capabilities at projects in the Netherlands and Argentina, respectively. FrieslandCampina is doubling WPI capacity at its Borculo, Netherlands, plant to meet rising global demand in the sports and infant nutrition sectors. The investment is part of a new business strategy called “Expedition 2030,” and also includes company-wide cost cuts to the tune of €400-500 million annually (about US$424-530 million). FrieslandCampina said the cost-cutting will not entail production facility closures. Denmark-based Arla Foods Ingredients is building a new drying tower to double whey permeate powder capacity at its plant in Porteña, Argentina. The company expects to complete the project in 2026. The expansion comes on the heels of a just-completed upgrade to the facility’s sanitary standards to produce infant formula-grade proteins. The company said infant-grade products will account for “a sizeable proportion” of the plant’s output within the first year and increase further over time. (Company reports)

California Dairies Inc. (CDI) continues to achieve benchmarks in its commitment to reducing greenhouse gas emissions and its journey toward sustainability. As part of those efforts, California’s largest member-owned milk marketing and processing cooperative has successfully implemented three innovative decarbonization technologies developed to improve energy efficiency and reduce emissions without interrupting operations at two of its largest facilities. CDI worked with industrial thermal energy service provider Skyven Technologies to design and implement the technologies. They include two solar thermal systems that convert solar energy into heat for thermal processes to reduce steam loss and a boiler heat-recovery system that boosts boiler efficiency by roughly 10%. So far, these solutions have removed more than 3,500 MT of carbon dioxide emissions and more than 65,000 MMBtu of natural gas from those facilities. Those numbers are projected to grow to more than 4,700 MT of CO2 and more than 89,000 MMBtu of natural gas over the course of a full year. No up-front capital was required from CDI for the project. Financing included grant funding from the California Energy Commission’s Food Production Investment Program (FPIP), utility incentive funding from Pacific Gas & Electric and Southern California Gas, and investments from Skyven and energy performance investment company Kyotherm. Project officials say the decarbonization technologies will pay for themselves in the form of the resulting energy savings. CDI is working with its partners to implement additional decarbonization solutions at more facilities as it continues its work to advance dairy sustainability. In its latest sustainability report, CDI says it is committed to achieving carbon neutrality or better by 2050 and reducing direct and supply chain greenhouse gases 30% by 2030. The co-op is aiming for 80% of electricity use on CDI farms to be renewable or carbon-free by 2030, and 100% by 2045. (Company reports; DairyReporter.com, 10/5/23)

New Zealand’s Fonterra Co-operative Group announced a partnership with microbiome research institute APC Microbiome Ireland to develop a research center at University College Cork in Ireland. The collaboration, which will operate out of the newly established Fonterra microbiome research center, will work to better understand the human microbiome and develop new probiotic products designed to deliver health and wellness benefits. A Fonterra spokesman said the company aims to launch a number of new probiotic strains over the next decade. The center is expected to be operational by the end of this year. (Food Business Africa, 10/9/23)

FrieslandCampina Ingredients announced a new early life nutrition (ELN) platform developed to support the physical and mental development of children from age three into adolescence. The new platform, called Step Up Nutrition, features ingredients designed to support five areas of child development: growth, immunity, cognitive development, gut health and mental health. At Vitafoods Asia 2023 in Singapore, the company showcased prototypes of products featuring its ELN ingredients and their benefits. These products included a powdered milk drink developed to promote growth, an immunity-supporting drinkable yogurt, and milk drinks created to boost cognition and gut health. Company officials said despite a downturn in the regular infant milk market, they believe there is a growing global consumer demand for nutritional products for young children and that while dairy remains the “nutritional go-to” for most of them, a growing number of manufacturers are looking to the ELN category as a potential growth driver. (Dairy Reporter, 9/28/23; Nutrition Insight, 9/20/23)

Danone plans to launch a new infant formula containing milk droplets that closely mimic the structure found in breast milk. Paris-based Danone revealed the launch at the Growth Asia Summit 2023 in Singapore and said the product will be introduced in China later this year. The new formula, called Nuturis, is inspired by biomimicry and aims to replicate some of the parts of human milk fat globules, including size and structure, that could help babies digest the formula more similarly to breast milk. Research indicates this similarity may promote benefits, including improved metabolic outcomes and growth that is comparable to breastfed babies. (Growth Asia, 9/26/23)

Chinese dairy manufacturer Shanghai Milkground Food Tech is making a foray into exports. The company shipped its first load of cheese lollipops to Australia and Southeast Asia with plans to expand volume to both regions. The lollipops are made with dairy ingredients from Australia and come in three flavors: plain (salty), vanilla and strawberry. … China’s Lefuna Food Technology completed the initial phase of construction on a new cheese manufacturing plant in Shanghai. Lefuna, established in 2020, markets cheese powder and will expand into mozzarella once the new facility is up and running in mid-2024. The company expects sales from the facility to exceed $200 million annually starting in 2025. Future investments will add a 16,000-sq.-ft. lab and develop an in-house milk supply. … UAE-based food and beverage maker Nutridor opened a new AED75-million (about US$20 million) dairy processing facility in Dubai. The plant will handle about 125 MT of milk per day, producing value-added dairy products under the Abevia brand. Nutridor, which operates in more than 15 Middle Eastern and African countries, is targeting domestic as well as export markets in the region. (USDEC China office; USDEC Middle East/North Africa office)

Walmart plans to build a new $350 million milk processing plant in Valdosta, Georgia, to provide milk for more than 750 Walmart and Sam’s Club stores in Georgia and neighboring states. It will be the second milk processing plant that Walmart has built after the one that opened in 2018 in Fort Wayne, Indiana … French dairy company Lactalis has received regulatory clearance to finalize the acquisition of Dairy Partners Americas in Brazil after Fonterra and Nestlé put the venture on the market … British online grocer Abel & Cole says it has created the UK’s first environmentally-friendly refillable plastic milk bottle in order to reduce carbon emissions during transportation … New Zealand-based Synlait Milk announced that its exclusivity dispute with The A2 Milk Company remains unresolved and is now entering arbitration … Saudi food conglomerate Savola Group has confirmed that it’s exploring options for its $5.3 billion holding in the Middle East’s largest dairy firm, Almarai(Associated Press,10/11/23; Just Food,10/12/23; Dairy Reporter,10/16/23; FoodBev.com,10/18/23; Trade Arabia, 10/18/23)

Nestlé plans to shut down its Wyeth Nutrition infant formula facility and R&D center in Askeaton, County Limerick, Ireland. The factory produces products exclusively for export to China and Asia. The sharp decline in China’s birthrate in China coupled with gains by domestically produced formula makers has undercut demand for the plant’s products. Nestlé plans to transfer production to existing factories in Suzhou, Jiangsu Province, China and Konolfingen, Switzerland. The company has been unable to find a buyer for the facility but said it would remain open to offers. The plant shutdown is slated for the first quarter of 2026; the R&D facility will shutter in the first quarter of 2025. (The Irish Times, 10/18/23)

Vietnam’s Vinamilk signed a memorandum of understanding with Chinese “partners” to distribute Vinamilk yogurt in China. The Chinese companies—including Guangzhou Jiangnan Fruit and Vegetable Wholesale Market Management—will oversee imports, the distribution network, regulatory compliance and trade promotions. … After rolling out a milk, soy and fruit-powered beverage in Asia last year, Nestlé launched an instant beverage powder in Central and West Africa made with a blend of milk- and plant-based ingredients. Nido Milk & Soya was developed by the company’s R&D center in Cote d’Ivoire. … Arizona-based Villa Dolce Artisan Desserts is opening a 76,000 sq. ft. manufacturing plant in Glendale, Arizona to manufacture gelato and frozen novelties. (Company report; FoodBev.com, 10/23/23) November-Dec-19-2023-01-35-52-6575-PM

Irish dairy exporter Ornua, which owns Kerrygold, officially opened its new €40-million (about US$42 million) development at the company’s Kerrygold Park production facility in Mitchelstown, Co. Cork. The investment increases the site’s butter production capacity to 80,000 MT per year. The project includes 10 packing lines for a range of over 50 product formats supplied to more than 60 markets globally. An Ornua spokesman said the development is part of the company’s efforts to become Ireland’s first €2 billion (about US$2.1 billion) food brand. (Agriland, 10/25/23)

China’s Jialihe Husbandry is building a 24,000-cow dairy farm in Chifeng City, Inner Mongolia. The company expects to complete the project in December 2025. When at capacity, it will produce 150,000 MT of raw milk per year. … Norway’s TINE dairy is restructuring its processing operations to address long-term declines in domestic fluid milk and brown cheese consumption. The company is shuttering its Sem and Kristiansand fluid plants, halting fluid operations at Sola and Frya, and downsizing its cheese lines at Lom and Skjåk. TINE hopes planned brown cheese new product projects will lead to regrowth. … Saputo is permanently closing its Lancaster, Wisconsin, cheese plant following the opening of its newly converted Reedsburg, Wisconsin, facility to goat cheese manufacturing. Lancaster will close in the fourth quarter of 2024, along with the closure of Saputo’s Belmont, Wisconsin, goat cheese plant, which was previously announced. … Shake Shack opened its first unit in Malaysia in cooperation with Korean restaurant operator SPC Group and other local partners. Shake Shack plans to open more than 45 stores in Malaysia. Singapore and South Korea by 2031. (USDEC China office; Company news; Inside Retail, 10/31/23)

Leprino Foods President and CEO Mike Durkin announced that he would retire effective November 2024. Durkin joined Leprino as senior vice president and CFO in 2011 before taking over as president and CEO three years later. In addition to heading up Leprino, he has held various leadership positions in the U.S. dairy and world dairy industries, including chair of the Innovation Center for U.S. Dairy and as a member of Global Dairy Platform’s Global Dairy Board. Leprino announced that Lance FitzSimmons, executive vice president and chief supply chain officer, will succeed Durkin effective Nov. 1, 2024. FitzSimmons has been with Leprino since 2009, managing nearly every division of the company. (Company reports)

Mexico’s Grupo Lala exited the Nicaraguan market, reportedly selling its operations to a group called Nicaragua Dairy Ventures. Lala entered the Nicaraguan market in 2014, acquiring well-established local processor Eskimo SA and, two years later, La Perfecta, promising to expand milk collection, transfer technology to its milk suppliers, increase storage facilities, and create new jobs. After the sale announcement, media reports were critical of the company, saying the promises were unfulfilled. (Breaking Latest News, 11/3/23; La Prensa, 10/27/23)

New Zealand’s Olam Food Ingredients (OFI) new Tokoroa, North Island, processing plant is nearly finished with its commissioning stage. The NZ$100-million facility (about US$59 million) produced its first bags of WMP at the end of August, and staff has been fine-tuning the process since. Phase 2 of construction will add specialist powder capacity, although completion is at least two years away. … Starbucks said it expects to add nearly 15,000 locations outside of North America by 2030. It currently operates around 20,000 international cafes. (Farmers Weekly, 11/2/23; CNBC, 11/2/23) 

Wisconsin-based dairy cooperative Foremost Farms USA has partnered with Boston-based biotechnology company Ginkgo Bioworks to reduce the dairy industry’s carbon footprint while lowering manufacturing costs and creating a new revenue stream for the co-op’s Midwest dairy farmer members. The collaboration aims to use biotechnology advances to create and commercialize the domestic, sustainable conversion of low-value dairy manufacturing co-products into environmentally friendly, value-added materials. The organizations estimate that the new technology could help upcycle billions of pounds of dairy co-products each year. “We are innovating to continue our trajectory as environmental stewards that take care of our world and create value for dairy farm families by potentially lowering manufacturing costs and creating a significant new revenue stream for those farmers,” said Greg Schlafer, president and CEO of Foremost Farms. (Company reports)

New Zealand’s Fonterra Co-operative Group announced at its annual meeting several new initiatives supporting its climate ambitions. The first, an on-farm emissions reduction target, seeks to reduce the intensity of on-farm emissions (which comprises 86% of the co-op’s total emissions) by 30% by the year 2030. Fonterra said it plans to achieve this new target through reduction efforts, including sharing farming best practices such as feed quality and improving herd performance; novel technologies being developed through the agribusiness and government joint venture AgriZeroNZ; carbon removals from existing and new vegetation; and historical land-use change conversions to dairy. To support this plan, Fonterra launched a Climate Roadmap, a plan that outlines the actions the co-op will take toward its 2030 targets and ambition to be “net zero” by 2050. In addition, Fonterra voluntarily released its first climate-related disclosure report, which identifies risks and opportunities related to climate and helps the co-op plan for the future. New Zealand claims to be the first country to pass a law introducing mandatory climate-related risk reporting. This requirement will become mandatory next year for roughly 200 New Zealand companies, including Fonterra. Separate from Fonterra, New Zealand regional governments continue to advance new sustainability regulations. Proposed land and water regulations for the Otago region would cause several changes for area farmers. The regs include proposed changes around setbacks from waterbodies for various farming activities, suggested limits on the number of cows per hectare as a measure of intensity, suggested restrictions on the amount of nitrogen fertilizer used per hectare, and changes around minimum flows for the Manuherekia River. Farmers have expressed significant concerns regarding the proposals, which are still in the draft stage. The deadline to finalize the plan is June 2024. (Company reports; New Zealand Herald, 11/9/23)

Chinese dairy processor Junlebao Group acquired a 30% stake in Chinese fresh yogurt retailer More Yogurt. More Yogurt operates over 1,600 stores in first- and second-tier cities. Retail outlets are a growing distribution channel for fresh yogurt in China. (China Daily, 11/9/23)

Saputo is conducting a strategic review of its King Island Dairy specialty cheese plant in Tasmania, Australia. It is working with its advisor MA Moelis Australiaon potential options, including a possible sale. In addition, Saputo also announced it was committing A$27 million (about US$17 million) to a series of projects at its facilities in Victoria and Tasmania. … FrieslandCampina ended its farmer departure scheme, which it implemented in 2009 to incentivize milk suppliers to switch to alternate buyers. Regulators mandated that the company redirect 1.2 million tons of milk as a condition of the merger between Friesland Foods and Campina. More than 1,000 suppliers have left the co-op under the plan, reaching the 1.2 million ton threshold. FrieslandCampina says it is open to taking on new suppliers now that the scheme is cancelled. (Company news; ABC, 11/8/23) December-Dec-19-2023-01-50-52-0844-PM

Seattle-based Darigold plans to open a new office in the Boise, Idaho, area. The new site “gives us greater access to a larger workforce focused on agriculture, creates a better opportunity to establish Darigold as an employer of choice and valued community partner, and establishes a presence closer to some of our farming and production operations in other parts of our regions,” said Joe Coote, CEO. The company hopes to secure the space in early 2024. Completing tenant finish and staffing will take 18-24 months, Darigold estimates. (Company reports)

Between now and the first quarter of 2025, Ireland’s Lakeland Dairies plans to close three manufacturing sites, build a new fluid milk processing plant in Killeshandra, County Cavan, and align future investment toward value-added products. The company is closing its milk drying plant in Lough Egish and its butter facility in Banbridge in June 2024. The Lakeland Dairies fluid plant in the town of Monaghan will shut down in early 2025, with production transferred to a new facility at the company’s Killeshandra site. The company plans to sell the Monaghan fluid plant and the Banbridge butter facility. “The next decade will be less about large volume growth and more about value-added growth and adding capability throughout the business,” said CEO Colin Kelly. (Company reports)

India’s Kerala Cooperative Milk Marketing Federation (KCMMF), known by its trade name Milma, entered an agreement with retail giant Lulu Group to sell Milma dairy products in Lulu’s extensive network of Middle Eastern hypermarkets and malls. The Memorandum of Understanding, which was signed at the World Food India 2023 conference in New Delhi, aims to expand the range of dairy products available in Lulu’s stores to reach a wider segment of the population. KCMMF Chairman K.S. Mani said Milma is aiming to move the cooperative forward by looking beyond its traditional milk and curd products to additional offerings. The deal will initially place five long shelf-life Milma products—ghee, premium dark chocolates, golden milk mix powder (a health drink), instant paneer-butter masala and palada payasam mix—in Lulu hypermarkets, with the goal of eventually increasing the number of products sold at Lulu outlets to 25. The cooperative estimates the agreement will generate roughly US$12 million in the first two years. (USDEC Middle East/North Africa office; Agritimes, 11/7/23)

Japanese conglomerate Sojitz Corp.—together with Sojitz Asia and Sojitz Vietnam—jointly acquired full ownership of Vietnamese importer/distributor DaiTanViet Joint Stock Co., also known as New Viet Dairy. New Viet Dairy has a significant presence in dairy ingredients and cheese. Sojitz plans to collaborate with its subsidiary Huong Thuy Manufacture Service Trading Corp. to establish a broadline wholesale food distribution business in Vietnam focused on independent retailers, mass merchandisers and mid- to high-end hotels and restaurants. (Company reports)

McDonald’s is buying back Carlyle Group’s 28% stake in the fast-food giant’s China business. McDonald’s sold the bulk of the China business to Carlyle and Chinese-state-owned Citic in 2017; Citic will retain a 52% share. Since 2017, McDonald’s has doubled its footprint in China to more than 5,500 units and plans to reach 10,000 stores by 2028. … Danone plans to collaborate with Else Nutrition, a Canadian supplier of plant-based infant formula. The first stage of their partnership is a license agreement that will add Else’s products to Danone’s specialized nutrition portfolio and see Danone market and commercialize the line. (USDEC China office; CNBC, 11/20/23; Just Food, 11/14/23)

Mengniu Dairy has entered the Chinese baked goods sector with the launch of a high-calcium biscuit in two varieties: milk and cheese. The products use cheddar from Denmark, butter from New Zealand and milk powder and fluid milk from Mengniu. … Arla Foods Ingredients CEO Henrik Andersen is stepping down to pursue a new career path. Andersen has been with AFI since 1994 and held the CEO position since 2010. Luis Cubel, AFI’s vice president, commercial, will take over as the new CEO effective Feb. 1, 2024. The company has opened a search for Cubel’s replacement. … Lactalis filed a €1.1 billion claim for damages against lab services provider Eurofins. Lactalis says that Eurofins incorrectly found that salmonella was present in the company’s infant formula in 2017, causing a global recall and shutting down its plant in Craon, France, for nearly a year. Eurofins called the claim “frivolous.” … Switzerland’s Emmi Group opened its new cheese conversion and packaging facility in Stoughton, Wisconsin. The company says the facility helps simplify logistics, increases efficiency and advances its internal sustainability goals. (USDEC China office; Company reports; Food Safety News, 11/24/23; Boerderij/International-Dairy.com, 11/21/23)

Australia’s Pure Dairy Manufacturing began construction on a new state-of-the-art production facility in Melbourne. The A$100 million facility (about US$66 million) reportedly represents the largest privately funded Australian dairy investment in the last 40 years. Covering 10 acres, Pure Dairy’s M2 Industry Park site will include a 137,000-sq.-ft. facility housing the company’s manufacturing, R&D pilot plant, an innovation kitchen, warehousing, logistics and the corporate office. Company officials said the plant will feature innovative automated equipment that will “guarantee lean manufacturing and environmental sustainability to the highest accreditable global standards,” boost exports and contribute to economic growth. It is scheduled to open in early 2024. (Company reports)

Michigan Milk Producers Association (MMPA) recently announced its investment in GoodSport Nutrition, a Chicago-based startup that makes a dairy-based sports hydration drink. GoodSport uses a nutrient-rich byproduct from ultra-filtered milk processing to create the drink, called GoodSport, which the company says contains three times the electrolytes and 33% less sugar than traditional sports drinks. The dairy co-op and startup said their alliance aims to advance innovation, highlight their commitment to sustainability in the dairy industry, and champion the benefits of milk as a natural, effective and sustainable source of sports nutrition. (Company reports)

Clingate Oy, a Finnish company that manages industrial infrastructure dedicated to precision fermentation, acquired a former Valio production facility in Lappeenranta, Finland. The move will create what Clingate claims is the world’s largest precision fermentation facility. The company is dedicating the 363,000 sq. ft. plant to the advancement of biotechnology, with a focus on fostering research, development and production in precision fermentation and synthetic biology. Clingate officials expect the acquisition to help establish the region as a hub for cutting-edge biotechnology development. The collaborative ecosystem, Clingate says, is “poised to reshape the landscape of precision fermentation and synthetic biology, unlocking unprecedented possibilities for a sustainable and thriving future.” Clingate is aiming for the facility to be fully operational by the second half of 2024. (Company reports)

Australian dairy co-op Norco reopened its Lismore, New South Wales, ice cream plant 18 months after a record flood destroyed the facility. The rebuilt plant, which sits in a floodplain, features improved flood mitigation features to handle waters higher than those from 2022. The rebuild cost an estimated A$100 million. (Rural News Group, 11/30/23; FoodProcessing.com.au, 11/28/23)

Darigold CEO Joe Coote is stepping down to return with his family to his native Australia. Coote joined the co-op three years ago as president of its International Ingredients division before taking over as CEO in January 2022. Prior to that, he worked for 12 years globally in the dairy sector. Allan Huttema takes over as interim CEO effective immediately. Huttema is one of Darigold’s 300 farmer-owners and has served on the board of directors for nine years, the last three as chairman of the board. (Company reports)

Japan’s Meiji Co. is building a new ¥48-billion (about US$330 million) dairy production facility in Nakashibetsu, Hokkaido. The plant will replace Meiji’s Nishi Shunbetsu and Honbetsu facilities, producing the same products—nonfat dry milk, concentrated skim milk, butter and cream—as well as milk protein. It will handle 430,000 MT of raw milk per year, eventually increasing to half a million. Construction is slated to begin in April 2024 with an estimated completion date of March 2027. (Just Food, 12/7/23)

Lactalis expects to invest €160 million (about US$173 million) in its Italian operations in 2023-2024. Nearly 90% of that investment will go toward “improvement, maintenance and modernization” of its 31 facilities in Italy. … Danone North America commenced work on a $65-million coffee and creamer production line at its plant in Jacksonville, Florida. … French dairy processor SODIAAL spent €10 million (about US$11 million) at its Le Mans, France, facility to install a new line to package Yoplait yogurt in brick packs. The company says the new brick packaging is fully recyclable. (Just Food, 12/8/23; Jacksonville Record, 12/7/23; edairy news, 11/30/23)

As part of their year-old partnership to help reduce on-farm emissions, Nestléand New Zealand-based dairy cooperative Fonterra announced that the Swiss food giant will fund additional payments to Fonterra farmers that meet certain sustainability requirements. Under the new agreement, Nestlé will pay farmers for achieving one of three levels of Fonterra’s The Co-operative Differenceframework in the 2023/24 season. The framework lays out key farming and business practices related to quality, safety and sustainability, and rewards farmers that meet criteria across five focus areas: environment, animals, people and community, milk, and co-op and prosperity. Depending on the number of farmers achieving these levels, Fonterra estimates the additional payment will be about 1-2 New Zealand cents per KgMS. Nestlé New Zealand CEO Jennifer Chappell noted farmers’ importance to the company’s success: “Nestlé has sourced dairy from New Zealand for well over a hundred years and we will continue supporting farmers, alongside our partners, to develop new economic opportunities and reduce their greenhouse gas emissions,” she said. (Company reports)

Kent Precision Foods Group, a division of Iowa-based Kent Corp., acquired Australia’s Frosty Boy Global, a maker of powder-based products, including desserts, beverages, savory ingredients, bakery products and wellness items. The purchase significantly expands Kent’s global footprint. (Company reports)

Agropur named Maxime Devourdy president of Ingredients and Corporate Strategy. Devourdy most recently served Agropur as vice president, Corporate Development and Sustainable Growth Strategy. He replaces Dan LaMarche who is retiring after more than three decades with the company. … China’s Mengniu Dairy reportedly signed a strategic cooperation contract with restaurant group Yum China. The two companies plan to work together on resource sharing, new product innovation, supply chain, and environmental, social and corporate governance (ESG) considerations. From its five business units—ambient products, chilled products, fresh milk, desserts and Western cuisine—Mengniu plans to provide dairy solutions to Yum. … Separately, Yum celebrated the opening of its 10,000th KFC unit in China. The company added more than 1,150 in the first three quarters of 2023. … Dutch dairy co-op FrieslandCampina is cutting more than 1,800 jobs over the next two years as part of its “Expedition 2030” effort to slash by €400 million-€500 million per year by 2026 onward. The job cuts will come from “almost all parts of the organization.” (USDEC China office; Company reports; Dairy Processing, 12/15/23)

Minnesota dairy farm numbers are dropping for several reasons.

The Executive Director of Minnesota Milk claims that economic hardship isn’t the primary reason dairy farmers are leaving the industry.

According to Lucas Sjostrom expected that Minnesota and Wisconsin would lose 7.4% of their dairy farms by 2023. “You actually see a lot of exits in 2014, 2018, a year like 2020, and last year, so those are some of our better dairy years, so it may be a symptom of people planning their exits rather than getting surprised and needing to exit.”

Sjostrom expresses worry about the rise of farmers leaving the dairy industry, while many are considering the economic feasibility of their firm in the future. “I think it’s really hard to paint a picture of why these happen when they happen because if we lost 55 farms in December, that’s 55 individual stories.”

Minnesota has 1,825 dairy farms as of December 1, 2023. That is 146 less than the start of the year. December data have not been disclosed.

Neighboring Wisconsin lost 455 dairy farms in 2023, bringing the total to 5,661 as of January 1st, 2024.

Fewer dairy farms in the UK as a result of falling milk prices

Over the past year, 350 dairy farmers in Great Britain have quit the industry due to poor farmgate returns. As of October 2023, there were 7,500 dairy farmers remaining in England, Scotland, and Wales, a 4.5% decline compared to the same period the previous year. The decline is attributed to falling milk prices, which have squeezed the life out of producers making a profit. In September, the average milk price stood at 36.36 UK pence per litre, a drop of almost 13 ppl compared to the same month in 2022. Despite inflationary pressure on key farm inputs easing, farm costs such as energy, fuel, feed, and fertiliser remain historically high, leading to tightening farm margins. On the other hand, average milk production per farm has grown year-on-year but remains steady compared to volumes calculated in April 2023, indicating a shift towards larger farms.

As 2023 progressed, farms focused on improving efficiency and reducing farm costs. Grass growth for the majority of the 2023 season remained above the previous season and the 5-year average, sustaining milk yields from grazing cows. In recent months, GB milk production has begun to ease, with volumes down by 1.3% and 2.7% year-on-year.

Another safety record for milk

The dairy industry does an outstanding job ensuring that milk for consumers is free of antibiotic residues. This is a situation that is closely monitored and documented under the Grade A Pasteurized Milk Ordinance (PMO), which requires that all milk must be sampled and analyzed for animal drug residues before being processed. Any positive loads of milk are excluded from the human food chain.

Over a one-year period from October 1, 2022, to September 30, 2023, just 345 milk samples out of nearly 3.7 million samples tested positive for animal drug residues. That is an all-time low since the U.S. Food and Drug Administration (FDA) started compiling this information in 1994. This means a minute 0.009% of the 3,694,059 samples taken of Grade A milk in the United States were positive.

To highlight the progress that has been made, in 2002, 3,500 samples tested positive for animal drug residue. While that was still a very small proportion of the more than 4.6 million submitted samples, the nation’s dairy herds have now been under 1,000 positive milk samples for the past 12 years and below 500 positive samples for the last three.

These most recent numbers come from the FDA’s “National Milk Drug Residue Database Fiscal Year 2023 Annual Report” released in December. The previous record was set in 2022 with 424 samples.

33rd Butter Sculpture Unveiled: “Table for All: Pennsylvania Dairy Connects Communities”

American Dairy Association North East and Pennsylvania Dairy Promotion Program, in conjunction with the Pennsylvania Department of Agriculture, revealed the highly anticipated butter sculpture, a tableau that showcases the importance of the dairy industry’s traditions and its focus on sustainability.

“Table for All: Pennsylvania Dairy Connects Communities” is the theme of the 33rd butter sculpture. The sculpture depicts members of the community gathering around the dinner table, connecting through a delicious bounty of food while celebrating the hard work of Pennsylvania’s farmers.

Dairy farmer Walt Moore of Walmoore Holsteins in Cochranville, Pennsylvania, said, “Agriculture plays an important role in all of our lives, and I’m proud that the wholesome food we produce brings people together. This year’s butter sculpture illustrates the important connection between farmers and their local communities. That is very meaningful to me because I love what I do as a dairy farmer.”

The sculpture was constructed over several weeks by artists Jim Victor and Marie Pelton of Conshohocken, Pennsylvania, using more than 1,000 pounds of butter donated by Land O’ Lakes in Carlisle, Cumberland County.

“Creating art that showcases the hard work of dairy farmers is an immense source of pride for us,” said Jim Victor. “We also enjoy knowing that the sculpture tells an impactful story about the importance of agriculture,” added Marie Pelton.

The butter sculpture is on display in the Farm Show’s Main Hall. Following the Farm Show, the butter will be recycled on the Reinford Farm in Juniata County and converted into renewable energy in the farm’s methane digester.

Half a million people are expected to visit the butter sculpture at the PA Farm Show during its eight-day run from January 6th through January 13th.

About American Dairy Association North East

The American Dairy Association North East (ADANE) is the local affiliate of the National Dairy Council® and the regional consolidation of three promotion organizations, including the American Dairy Association and Dairy Council, Inc., Mid-Atlantic Dairy Association and Pennsylvania Dairy Promotion Program. Committed to nutrition education and research-based communications, ADANE provides science-based nutrition information to, and in collaboration with, a variety of stakeholders committed to fostering a healthier nation, including health professionals, educators, school nutrition directors, academia, industry, consumers and media. Funded by dairy checkoff dollars from 9,000 dairy farm families in New York, New Jersey, Pennsylvania, Maryland, Delaware, and northern Virginia, ADANE works closely with Dairy Management Inc.™ to bring a fully integrated promotion program to the North East region. For more information, visit AmericanDairy.com.

About Pennsylvania Dairy Promotion Program

Pennsylvania Dairy Promotion Program is the farmer-directed organization funded by participating dairy farmers to build demand and sales for milk and dairy foods throughout Pennsylvania. Managed by American Dairy Association North East, Pennsylvania Dairy Promotion Program develops and implements local programs to drive milk and dairy sales at retail outlets and in schools. The organizations also conduct consumer education about dairy through events, traditional and social media, and in collaboration with health professionals through National Dairy Council®. For more information, visit www.AmericanDairy.com or call 315.472.9143.

Dozens of Minnesota dairy farms closed in November, state association reported.

Minnesota has 1,825 active dairy farm licenses, a decrease of 146 from the beginning of the year. Over 4,000 dairy farms were in the state a decade ago.

Minnesota lost 58 dairy farm licenses in November, a severe blow to an already depleted agriculture economy.

“There is some seasonality to this.” “Some herds always leave in October, November, and December,” said Lucas Sjostrom, executive director of the Minnesota Milk Producers Association. “But I have not seen (a monthly declines in permits) over 50 for a long time.”

More farmers often opt out of milking cows at the end of the year, either permanently or temporarily, as producers store silage or grain for the new year.

Sjostrom, on the other hand, believes November’s figures highlight the razor-thin financial margins for dairy producers facing a barrage of economic challenges, such as high input costs and poor commodity values, barely a year after dairy enjoyed higher milk, cheese, and butter prices in the wake of the pandemic.

Farmers, according to Sjostrom, are not going bankrupt. He lauded safety-net initiatives like Minnesota’s Dairy Assistance, Investment, and Relief Initiative for assisting farmers amid milk price drops.

The U.S. dairy sector wants to fight climate change without sacrificing global food security.

As the world’s food sectors took center stage at COP28 in Dubai, the dairy industry’s contribution to the greenhouse gas reduction process is receiving the attention it deserves.

We also know, as dairy farmers, that our product is utilized to make a diverse range of nutritionally rich foods, drinks, and components that feed customers in the United States and across the globe. We also paid close attention in September to the United Nations General Assembly, which emphasized the tremendous rise in global hunger and malnutrition, which has been compounded by conflict, the effects of climate change, and supply chain disruptions.

Make no mistake: trade has never been more crucial than today in ensuring that people in need obtain good nourishment as cheaply and quickly as possible. In summary, criticism that food commerce contributes to climate change is exaggerated. Data show that food transportation is a minor source to global emissions, and concentrating on “food miles” obscures a plethora of variables that might effect a product’s carbon footprint, such as land usage, production techniques, and storage. New trade obstacles erected to achieve indiscriminate reductions would harm global nutrition.

According to a 2022 research published in the journal Nature, trade restrictions would exacerbate the effects of climate change on hunger, increasing the incidence of undernourished individuals by up to 47%. In contrast, the same research found that lowering trade barriers would somewhat mitigate the effect of climate change on hunger, reducing climate-related malnourishment by up to 64%.

And dairy isn’t just any foodstuff; few meals provide the nutritional punch that dairy does. In the United States, milk, cheese, and yogurt are excellent sources of protein, calcium, phosphorus, magnesium, potassium, and vitamins A, B12, D, and riboflavin.

Importantly, the North American dairy industry, in which the United States is the principal milk producer, lowered greenhouse gas (GHG) emissions intensity (emissions per gallon of milk produced) by 2.2% per year from 2005 to 2015, despite a 2.1% rise in milk output. A significant national program with the Foundation for Food and Agriculture Research (FFAR) that has received $30 million in financing from food industry partners and the foundation intends to speed our sector’s emission-reduction efforts toward GHG neutrality by 2050.

And we haven’t stopped trying to become better since. We have taken numerous meaningful measures toward our industry-wide objective of GHG neutrality by 2050 by collaborating with partners around the nation. This includes, but is not limited to, investing in research and pilot projects to discover new scalable techniques and technologies that may boost trash recycling, water reuse, and energy savings.

We recognize that, like any business, we must act quicker and on a greater scale to reduce emissions. We are not perfect, but we are putting in more effort and resources to meet our carbon reduction targets while still meeting the world’s crucial demands for food and high-quality nutrition.

Because those objectives are industry-wide, farms of diverse sizes and climates throughout the United States are now exploring new tools, methods, and technology to see what works best for their operations.

Achieving our lofty aims will undoubtedly need the acquisition of several new instruments. For example, we are undertaking research on soil management strategies that may help boost productivity, decrease on-farm GHG emissions, increase soil’s ability to store carbon from the atmosphere, and improve water quality by lowering runoff.

Most importantly, the instruments we need to fulfill our sustainability objectives must be economically feasible. Family farms are also small companies. We are making sound judgments, but we must also consider the economic feasibility of our choices for today and future generations.

Fortunately, we think it is possible. Already now, new income streams connected with more sustainable agricultural techniques enable farmers to implement cost-neutral or lucrative innovation practices and technology.

That puts us back to business. We don’t only exchange things when we trade. We exchange ideas. Our trade partnerships provide a pathway for information sharing regarding U.S. dairy sustainability and nutritional density–all of the technologies, tools, and practices we are building, as well as all of the dairy nutrition research.

We were in Dubai this year for COP 28 to highlight both of these realities and to explain the continued efforts of the US dairy sector to significantly decrease greenhouse gas (GHG) emissions while playing an increasingly important role in fulfilling global nutrition demands and maintaining food security. Trade is a major component of this.

Throughout the conference, we emphasized the importance of free commerce in ensuring the speedy and efficient transmission of knowledge and ensuring enough nutrient-dense food is accessible for those in need.

The world has no time to waste in using all we’ve learned collectively to address the climate and food crises. We must exercise caution in responding to these two interconnected summons to action so that none is harmed at the cost of the other.

6 major food companies form Dairy Methane Action Alliance

Six major food corporations have formed an agreement to assist dairy farmers in reducing methane emissions and improving agricultural sustainability.

The Bel Group, Danone, General Mills, Kraft Heinz, Lactalis USA, and Nestlé formed the Dairy Methane Action Alliance (DMAA) with the Environmental Defense Fund (EDF) to assist decrease and account for methane emissions in their dairy supply chains.

“These companies will account for and publicly disclose the total methane emissions associated with their dairy supply chains in a transparent manner.” They also vow to develop a public methane action plan by the end of 2024 to reduce methane emissions in their dairy supply chains, according to the EDF’s website.

The DMAA is a first step in establishing a new paradigm for food sector transparency, engagement, and emissions reduction.

“With Environmental Defense Fund leading the effort and providing support for farmers and companies — as well as cutting-edge research on innovative solutions such as changing cows’ diets and improving how manure is managed — the Dairy Methane Action Alliance is poised to make a global impact,” EDF said in a statement.

The six corporations together generate more than $200 billion in worldwide sales.

“We’re extending an open invitation to everyone in the dairy sector to join us, and deliver even larger action at scale,” the European Dairy Federation (EDF) stated.
Additional measures to limit methane emissions

The Global Methane Hub and Danone formed a new cooperation in November to minimize methane emissions and promote scalable solutions in agriculture. Danone will be the first corporate supporter of the Enteric Fermentation R&D Accelerator, the biggest ever internationally coordinated research effort on enteric methane, led by GMH and backed by a coalition of charitable organizations and governments.

In August, the Greener Cattle Initiative, a new research consortium, awarded its first grant of more than $750,000 to Penn State’s Distinguished Professor of Dairy Nutrition Dr. Alexander N. Hristov to support Hristov’s work to develop new methane inhibitors for cattle producers by focusing on innovative compounds that have demonstrated an ability to reduce enteric methane emissions by at least 30% in early laboratory tests.

The Global Methane Pledge, signed by more than 150 nations, aims to reduce anthropogenic methane emissions by at least 30% from 2020 levels by 2030. Feeding techniques that reduce enteric methane emissions in dairy cattle are critical to attaining this aim, and a broad range of products have the ability to reduce methane emissions in dairy cattle.

Wisconsin outpaces national milk output decline

Wisconsin’s dairy farmers kept the milk flowing in November, with a slight increase in output over the previous month. While this tiny gain is still significantly below November 2022 levels, it provides a ray of optimism in a national situation of diminishing milk production.

Here’s a deeper look at the statistics:

Wisconsin:

• Milk production: 2.58 billion pounds (higher from October but somewhat lower than November 2022).

• Milk cows: 1.27 million (flat compared to October, slightly lower than November 2022).

• Cow output: 2,035 pounds (up significantly from November 2022).

There are 24 major milk-producing states:

• Milk output: 17.3 billion pounds (a 0.5% decrease from November 2022).

• Cow output: 1,948 pounds (down 3 pounds from November 2022).

• Milk cows: 8.90 million (down from 11.22 million in November 2022 and 10.23 million in October 2023)

National:

• Milk output: 18.1 billion pounds (a 0.6% decrease from November 2022).

• Cow output: 1,932 pounds (down 2 pounds from November 2022).

9.36 million milk cows (reduced from November 2022 and October 2023)

Israeli dairy farms employ thousands of Africans after Hamas killed several employees

Several African nations are sending agricultural laborers to assist out in Israel after Hamas killed several employees and pushed many more to escape.

Workers from Thailand and other foreign nations regularly visit to Israel to assist on fields, but since the conflict began on October 7, nearly 10,000 of those workers have returned home. Over 30 Thai agricultural laborers died.
Israeli dairy laborers

Palestinian laborers made up about 20% of Israel’s agricultural workforce, but the Israeli government has barred them from working there any more. Furthermore, the Israeli government has summoned back 360,000 reservists to the army, affecting the labor force.

This has created a significant hole in Israel’s agricultural labor force, which is presently being replaced by volunteers from throughout the country with little or no farming expertise. Israel presently requires between 30,000 and 40,000 laborers to maintain its farms running.

Kenya has previously sent 1,500 laborers to Israel, and Malawi has sent 221 as well. These casual workers will be hired on 3-year renewable contracts with a monthly salary of roughly $1,500 USD.
African dairy laborers

According to Michael Lotem, Israel’s ambassador in Kenya, Israel is also preparing to hire agricultural laborers from Uganda and has already begun accepting workers from Tanzania.

He added: “We are looking to East Africa to fill the labour gap as we have had student internships programmes in place for many years with these countries and it has been a good experience.”

High unemployment in several African nations, such as Malawi, is one of the major causes driving young people to leave their home country and seek work elsewhere. Many of the African laborers, however, are anxious about their living circumstances in Israel, as well as their safety as the conflict continues.

In response to safety concerns, Lotem said that agricultural laborers would not be deployed in combat zones and would be given the same security as Israelis.

Milk output decreased somewhat, according to the USDA.

According to the USDA, milk output fell slightly in November. The 24 main dairy states produced 17.3 billion pounds, a 0.5% decrease from November of last year. The USDA also corrected the October data, showing that output is down 0.6% this year compared to last.

In November, production per cow was 1,948, a three-pound decrease from November 2022. With 2,220 pounds per cow, Michigan continues to have the highest average per cow output.

The total number of milk cows in the 24 main milk producing states is 8.9 million, which is 26,000 lower than a year ago and 9,000 fewer than a month ago. With 1.71 million head, California has the biggest dairy herd, followed by Wisconsin with 1.27 million head.

The Senate Agriculture Committee’s chair blocks whole milk bill

The Senate Agriculture Committee’s chair has blocked the Whole Mil For Healthy Kids bill. During Thursday’s floor discussion, Michigan Democrat Debbie Stabenow said that she supports healthy alternatives for children and that dairy is a key element of a balanced diet. “But one thing that’s clear, and that is that school meal standards currently based on dietary science should continue to be based on dietary science, not based on which individual food products that we support.”

Senator Roger Marshall of Kansas drafted the companion measure and requested unanimous approval to bring it up for a Senate vote. “As medical costs continue to rise and the obesity epidemic worsens, I rise today to correct the record.” Milk is a component of the solution, not the issue.”

According to Marshall, calcium, potassium, and vitamin D are three of the top four underutilized nutrients in America, and milk is high in these minerals.

According to Stabenow, the USDA is in the midst of rewriting school food guidelines, and it is critical that they make judgments about what is best for our children based on the most recent nutritional research.

Russian Danone and PepsiCo dairy problem

Despite obstacles, Western companies continue to leave Russia’s dairy sector, according to local experts.

The withdrawal of Danone from the Russian market is the largest and most anticipated transaction in the Russian dairy business, according to Alexey Kurasov, director of the corporate finance department at the Russian consultancy Finam, who spoke at the Agricultural Holdings of Russia 2023 conference in Moscow.

According to experts, Danone still has a chance to sell its Russian company, which has been placed under temporary state administration. To close the contract, the corporation must agree to a discount.

After the firm has been appraised by advisors chosen by the Russian government, Moscow requires a 50% discount on all overseas agreements. According to reports, the authorities have sought a larger reduction in certain situations in recent months.

According to the Financial Times, Danone still wants to finalize the official sale of its Russian company. The firm thinks that if it is correctly paired with the appropriate government-approved buyer, it may still generate money.

Western companies are projected to leave until the first quarter of 2024, according to Kurasov. Furthermore, researchers expect ‘cautious attempts’ by investors from the Middle East and China to join the Russian market, according to Kurasov.
PepsiCo simplifies operations

Danone is hardly the only company attempting to sell Russian assets. According to the local business weekly Kommersant, PepsiCo is in negotiations with Tkachev’s agricultural complex about selling its dairy factory in Krasnodar Krai. According to the magazine, the corporation intends to simplify its operations in the nation.

It intended to halt operations during the summer of 2023 before being passed to the new owner.

PepsiCo’s dairy segment now has 14 manufacturing facilities in Russia. It produced 940,700 tons of dairy products in 2022, 8.7% less than the previous year.

According to Alexey Gruzdev, general director of Moscow-based think tank Streda Consulting, the Kradnodar plant’s output levels were judged to be inadequate and were dispersed to other manufacturing locations.

Tkachev’s agricultural complex is Russia’s second-largest producer of raw milk. The transaction might benefit the company’s business margins, since raw milk prices in the nation fell by 20-25% in the first half of 2023, according to Kommersant, citing statistics from the Russian Union of Dairy Producers Soyuzmoloko.

Navigating Climate Change: Assessing Risks and Building Resilience in Dairy Farming

Dairy farming, a cornerstone of the agricultural industry, is facing unprecedented challenges in the era of climate change. Shifts in weather patterns, extreme events, and fluctuating temperatures pose significant risks to dairy operations globally. This article explores the potential risks that climate change presents to dairy farms and discusses strategies to enhance resilience in the face of these challenges.

  1. Temperature Extremes:
    Climate change brings about more frequent and intense heatwaves, impacting dairy cows’ well-being and milk production. Heat stress can lead to reduced fertility, lower milk yields, and increased susceptibility to diseases. To mitigate these risks, farmers may need to invest in cooling systems, shade structures, and breeding for heat-resistant cattle breeds.
  2. Water Scarcity:
    Changes in precipitation patterns and prolonged droughts contribute to water scarcity, affecting both crop irrigation and the hydration of dairy cattle. Dairy farms must implement water conservation measures, such as efficient irrigation systems, rainwater harvesting, and the use of recycled water. Developing sustainable water management practices is crucial for resilience.
  3. Forage and Feed Challenges:
    Altered climate conditions can disrupt forage and feed availability, impacting the nutritional intake of dairy cows. Farmers may need to diversify forage sources, invest in drought-resistant crops, and explore alternative feed options. Improved storage and preservation methods can also help mitigate the impact of changing climate conditions on feed quality.
  4. Disease Outbreaks:
    Climate change can create favorable conditions for the spread of diseases affecting both cattle and crops. Increased temperatures and humidity provide ideal environments for pathogens and pests. Dairy farms must implement robust biosecurity measures, vaccination programs, and pest control strategies to safeguard the health of their herds and crops.
  5. Market Volatility:
    Climate-related disruptions can have cascading effects on the dairy market, leading to price volatility and supply chain challenges. Dairy farmers should diversify their income streams, explore value-added products, and engage in risk management strategies to navigate market uncertainties effectively.
  6. Policy and Regulatory Changes:
    Shifting climate patterns often prompt changes in government policies and regulations related to agriculture. Dairy farmers should stay informed about evolving policies, participate in advocacy efforts, and adapt their operations to comply with new standards, ensuring long-term sustainability.
  7. Investing in Technology and Innovation:
    Embracing technological advancements, such as precision agriculture, data analytics, and climate-resilient breeding techniques, can enhance the adaptive capacity of dairy farms. These innovations enable farmers to make informed decisions, optimize resource use, and build a more resilient and sustainable agricultural system.

Climate change poses multifaceted risks to dairy farming, necessitating a proactive approach to build resilience. By addressing challenges related to temperature extremes, water scarcity, forage and feed availability, disease outbreaks, market volatility, and policy changes, dairy farmers can safeguard their operations and contribute to a more sustainable future. Investing in adaptive technologies, sustainable practices, and strategic planning will be essential for the dairy industry to thrive amid the uncertainties of a changing climate.

US Dairy Production Moves From Milk to Products

The Agriculture Department has reduced its forecast for US milk output for next year, with dairy producers preferring to produce other products such as butter and cheese.

The USDA cut its forecast for 2024 milk output to 229 billion pounds, down 1 billion pounds from its previous forecast and the lowest estimate for that year, in its monthly global agricultural supply and demand report released on Friday. The USDA also reduced its prediction for 2023 milk output by 200 million pounds from November to 226.9 billion pounds.

The USDA attributed the reduction to “reduced” milk output per cow, as well as a smaller dairy herd.

Dairy producers prefer to have their cows produce more components for products such as butter and cheese, which reduces milk output, according to Corey Geiger, CoBank’s chief dairy economist. “Most consumers are eating their dairy products these days as opposed to drinking beverage milk.”

Farmers are feeding their cows in such a manner as to generate more butterfat, according to Geiger in a CoBank research released in November, as butterfat products have regained appeal after public perception regarding saturated fats turned to being more favorable.

As a result, dairy cows produce less palatable milk.

According to USDA statistics, the proportion of butterfat in milk has climbed to its highest level since the Great Depression, with the percentage increasing dramatically in the last ten years.

Mexican Dairy Consumption to Rise in 2024

Mexico’s economy has increased for eight consecutive quarters, but a dip is possible. It is unclear how this will affect dairy demand in 2025 and beyond, but for the time being, demand has been robust and is likely to increase again next year, which should assist raise US exports.

According to Betty Berning, a Daily Dairy Report analyst, “the Mexican peso has strengthened against the US dollar for the majority of 2023, with a slight setback this fall.” The peso is now on the rise, with its value compared to the US dollar already 14% higher than a year ago. Strong demand from the US’s main dairy export market will help keep dairy goods flowing and prices stable.”

According to a recent USDA Global Agricultural Information Network (GAIN) analysis, Mexico’s milk output is predicted to rise 2% year on year to slightly more than 30.4 billion pounds in 2024. An increase of 50,000 cows over this year will bring Mexico’s milk herd to 6.7 million head. The increase in production in 2024 will be driven by increased cow numbers paired with a modest 1% increase in milk per cow.

“Lower farm input costs and rising domestic demand have pushed milk volume growth.” “Mexico processes slightly more than half of its milk, with the remainder used for drinking milk,” Berning said.

Despite expected increases in milk output, Mexico remains a milk-deficit market, according to Berning, and Mexicans are major aficionados of dairy products. Queso Fresco, a typical Mexican cheese, is popular, but some customers are looking for new variations, according to her, and although Mexico ranks fifth in worldwide butter consumption, it ranks 43rd in butter production.

Mexico’s cheese and butter production are expected to expand by 2% in 2024 compared to this year, but the country will still need to import around 27% of its cheese and 5% of its butter, according to the USDA. Cheese consumption, which has been increasing for many years, will rise by 2% this year as buying power rises and the population expands.

“Skim milk powder in Mexico is used heavily by the hotel, restaurant, and institutions sectors, and skim milk powder is also the main U.S. dairy product exported south of the border,” Berning went on to say. “And that bodes well for exports as the sectors continue to improve post-Covid.”

According to the USDA, consumption of skim milk powder is expected to increase by 11% to 498,000 MT in 2023, while Mexico’s milk driers are only expected to increase throughput by 1,000 MT to 49,000 MT next year. According to the USDA, this implies imports, which account for 90% of overall consumption, would need to climb by 13%.

Collaboration and momentum main themes of Sustainable Agriculture Summit

More than 900 farmer and industry leaders gathered to discuss advancements, challenges and opportunities for scaled action

Barbara O’Brien, president and CEO of Dairy Management Inc. and the Innovation Center for U.S. Dairy, said with a growing global population demanding more food, significant geo-political unrest, and unprecedented climate challenges, “we need to take a more thoughtful approach to building resilient food systems” and “agriculture must be at the forefront” during remarks at the Sustainable Agriculture Summit held Dec. 6-7 in Charlotte, N.C.

The Summit, in its ninth year, is co-hosted by the Innovation Center for U.S. Dairy, Field to Market: The Alliance for Sustainable Agriculture and six other national ag organizations to convene the collective food and agriculture value chain to learn, develop and advance a shared vision for a sustainable and resilient U.S. food system. This year’s theme was “Scaling Collective Impact: Collaborating to Accelerate Agricultural Sustainability.”

In pre-recorded keynote remarks, U.S. Secretary of Agriculture Tom Vilsack stated convenings like the Summit are critical to working toward an agricultural future that is sustainable and climate smart.

He noted the Inflation Reduction Act made nearly $20 billion available over the next five years for USDA’s Natural Resources Conservation Service to address continuous high demand for the Environmental Quality Incentive Program and the Regional Conservation Partnership Program and stressed the importance of working quickly to get this money into the hands of producers.

Featured Summit sessions and discussions included:

  • the momentum that collaboration across ag sectors and their value chains can drive in order to mitigate environmental impacts;
  • exploration of partnerships and opportunities to scale solutions;
  • examination of the role of research and emerging technologies as a guiding force for agriculture’s sustainable future;
  • the need for reporting and sourcing protocols to recognize sector/regional programs already in place;
  • the importance of advancing nutrient management practices; and
  • access to funding sources to implement solutions that further accelerate sustainable progress.

Food waste solutions were also highlighted since, in the United States, more than half of the produce is wasted, and 30 percent of total food production is lost before it reaches consumers.

Always a highlight of the Summit, producers across ag sectors shared how they approach sustainability on their farms, voicing their successes and challenges in making sustainability gains and the need to safeguard producer livelihood in the context of environmental stewardship.

Dairy farmers Andy Rodgers (Georgia), Brian Larson (Wisconsin), Greg Bethard (Kansas) and Steve Harnish (Pennsylvania) contributed perspectives on integrating sustainable practices and technologies through panel participation and breakout sessions. Rodgers said that, too often, those who advise on implementing sustainability practices and technologies don’t know enough about the unique needs of farmers’ operations to recommend solutions, and he stressed the need for that level of understanding to foster trust.

Attendees were left with these inspiring remarks by Virginia dairy farmer and National Dairy Promotion and Research Board Chair Joanna Shipp: “Sustainable agriculture isn’t a far-off goal. It’s a journey we have been on together. We’re cultivating a legacy of positive, scalable impact that will nurture future generations.”

Dairy Sustainability Alliance Fall Meeting Explores U.S. Dairy Community Efforts to Advance Shared Priorities

Dairy industry leaders explored the theme of “U.S. Dairy Sustainability in Action,” including ways individual dairy companies are demonstrating action and making impact towards shared U.S. dairy priorities during the Dairy Sustainability Alliance Fall Meeting held in Charlotte ahead of the Sustainable Agriculture Summit.

The Dairy Sustainability Alliance, formed through the checkoff-founded Innovation Center for U.S. Dairy, convenes nearly 200 companies and organizations across the dairy community and others who want to contribute to dairy’s social responsibility journey. This year’s meeting boasted record attendance, with more than 340 industry stakeholders, including approximately 30 farmers.

Themes discussed included advancing commitments and action through forums like the Dairy Sustainability Alliance; transparently communicating progress to stakeholders; sustainable food production; and investments in new research, technologies and practices on-farm and throughout the supply chain that reinforce a commitment to protecting natural resources and minimizing dairy’s environmental footprint – all while ensuring economic viability and uncovering new revenue opportunities for farmers and organizations.

The meeting’s opening panel covered insights on how farmers are currently thinking about and adapting to the effects of climate change and the complexity that goes into making practice and technology decisions on the farm. Panelists, including dairy farmer Suzanne Vold (Minnesota), emphasized that collaboration, direct conversations with the farmers, and co-investment all along the dairy value chain are required to support progress.

In another session, Brad Anderson (California Dairies, Inc.), Nicole Ayache (National Milk Producers Federation), Jackie Klippenstein (Dairy Farmers of America) and Elena Saputo (SustainCERT) discussed the importance of working collaboratively to support the modernization of GHG accounting standards to better meet the needs of agricultural sectors, including dairy.

In addition to the Fall Meeting, attendees had the opportunity to learn more about sustainable farming practices by visiting two Charlotte-area farms: White Rock Farms and Grayhouse Farms, a 2022 winner of the U.S. Dairy Sustainability Awards. The two farms showcased modern facilities and shared how conservation, cow comfort, and water and manure management practices help enhance biodiversity and recycle nutrients.

Summing up the event, O’Brien said: “The Dairy Sustainability Alliance meetings represent collaboration at its best. They are the forum for sharing best practices and learnings and for bringing together new and varied perspectives and solutions from across the value chain.”

“It’s our ability to work together against common goals combined with the diverse nature and scale of U.S. dairy – from farm to retail – that gives us a unique strength and competitive advantage in a global marketplace,” added O’Brien. “It is clear that we are leveraging our individual and collective strengths to advance action within those sustainability topics that are important to customers and consumers and to the future demand for dairy both domestically and globally.”

For information about the industry’s sustainability work and the dairy checkoff, visit www.usdairy.com.

 

About the Innovation Center for U.S. Dairy

The Innovation Center for U.S. Dairy® is a leadership forum that brings together the dairy community and third parties to address the changing needs and expectations of consumers and customers. Initiated in 2008 by dairy farmers through the dairy checkoff, Innovation Center leaders and members collaborate on important areas like the environment, nutrition and health, animal care, food safety, and community contributions. Through the Innovation Center, the U.S. dairy community demonstrates its commitment to continuous improvement from farm to table, striving to ensure a socially responsible and economically viable dairy community. For more information, visit www.usdairy.com/about-us/innovation-center

 

Milking Progress: The Green Revolution in US Dairy Farming

In recent years, the dairy industry in the United States has undergone a transformative shift toward sustainability, driven by a growing awareness of environmental concerns and the need to address climate change. This article explores the innovative ways in which the US dairy sector is adopting eco-friendly practices, reducing its environmental footprint, and embracing a greener future.

  1. Sustainable Farming Practices:
    Modern dairy farms are increasingly implementing sustainable agricultural practices to minimize their impact on the environment. This includes optimizing feed efficiency, reducing water usage, and adopting precision farming techniques. By optimizing resource management, farmers aim to decrease their overall ecological footprint while maintaining efficient dairy production.
  1. Renewable Energy Integration:
    Many dairy farms across the US are harnessing renewable energy sources to power their operations. Solar panels, wind turbines, and anaerobic digesters that convert manure into biogas are becoming common sights on dairy farms. This shift towards renewable energy not only reduces greenhouse gas emissions but also helps farmers cut costs in the long run.
  1. Methane Capture and Mitigation:
    Methane emissions from cattle have long been associated with the dairy industry’s environmental impact. However, advancements in methane capture technologies are helping to address this concern. Innovative solutions, such as feed additives and dietary adjustments, are being explored to reduce methane production in cows, thereby mitigating the industry’s contribution to climate change.
  1. Circular Economy Approaches:
    The dairy industry is increasingly adopting circular economy principles to minimize waste and maximize resource efficiency. By reusing and recycling materials, including manure and by-products, farms are contributing to a more sustainable and closed-loop system. This approach not only reduces waste but also enhances the overall environmental performance of dairy operations.
  1. Sustainable Packaging and Processing:
    Beyond the farm, the dairy industry is reevaluating its packaging and processing practices. Companies are exploring environmentally friendly packaging materials, reducing plastic usage, and implementing energy-efficient processing methods. These efforts extend sustainability beyond the farm gate and encompass the entire dairy supply chain.
  2. Consumer Awareness and Demand:
    Growing consumer awareness of environmental issues and a preference for sustainable products are driving changes in the dairy industry. As consumers become more eco-conscious, dairy producers are responding by transparently communicating their sustainability efforts and adopting practices that align with consumer values.

The US dairy industry’s journey toward greener practices reflects a broader commitment to sustainability and environmental stewardship. Through a combination of technological advancements, renewable energy integration, and consumer-driven demand for eco-friendly products, the dairy sector is making significant strides in reducing its environmental impact. As the industry continues to innovate and collaborate, it paves the way for a more sustainable and environmentally conscious future for US dairy farming.

America’s Love Affair with Dairy Continues as Cheese Consumption Hits All-Time High in 2022

Call it grate! Call it legend-dairy. Say it’s whey up! That’s because Americans are writing a new chapter in their love affair with dairy products, according to fresh data from the U.S. Department of Agriculture (USDA) which reports per capita consumption of all dairy products reached 653 pounds per person in 2022, 63 pounds above the historical average dating back to 1975 when USDA began tracking per capita dairy consumption. Cheese consumption set an all-time high in 2022 to reach nearly 42 pounds per person, a half-a-pound per-person increase over the previous year. For comparison, the average American consumed 32.2 pounds of cheese in 2000 and 21.9 pounds in 1980. Ice cream consumption in 2022 also edged out the previous year, while other dairy products including yogurt and butter remained consistent with recent year highs.

“Americans are turning to dairy like never before as part of their health regimen, to celebrate with family and friends, or to liven up their meal and snacking routines. The data from USDA demonstrate how consumers continue to choose dairy products even as they exercise cost-conscious shopping, illustrating how dairy remains affordable and accessible to all people. Dairy is more than a food or beverage—it has become an essential part of our lives, in more than 95% of U.S. households on any given day. The growth in dairy consumption is a testament to America’s dairy foods makers who offer wholesome, delicious, affordable products for people all ages, all year around.”

In the past decade alone, domestic per capita consumption of cheese is up 17.1% and per capita butter consumption is up 9.0%. Overall, USDA data show American dairy per capita consumption across products consistently increasing each year, with 2022 up 0.4% over the past five years, 7.5% over the past 15 years, and 16.1% over the past 30 years.

“If it’s made with dairy and it can fit on a plate, in a bowl, or in your favorite mug, chances are Americans are loving it more than ever before. Today’s dairy is different because dairy is always evolving to give Americans what they crave.”

Overall dairy consumption in 2022 was the second highest total on record. Additional charts are available here to illustrate the consistent growth in per capita consumption of dairy products.

Expect slow milk supply growth and rising dairy prices in 2024.

According to a recent analysis from worldwide financial services firm Rabobank, restricted milk supply growth and weak demand will result in flat dairy commodity prices in 2023. However, the global dairy industry looks to be entering the next stage of its cycle, with prices expected to rise until 2024. Nonetheless, the market is tightly balanced, and underlying demand for 2024 remains unclear.

As 2023 approaches, the global dairy industry is on a precarious balance of limited “new” milk and slow demand. Due to worse underlying fundamentals, global dairy commodity price was lackluster this year. Global milk supply growth has been disappointing, with three quarters of increase. Lower milk prices, higher expenses, and weather disruptions then put the clamps back on.

According to the paper, titled Shifting to the Next Phase of the Cycle, “tightening margins drove increased culling and subsequent milk production pullback” in the United States. Slaughter has slowed, and profits are recovering but not yet indicating growth.”

Other important regions, such as the European Union and South America, are experiencing challenging margins amid reductions with pockets of optimism.

Rabobank’s forecast for milk supply in 2024 has decreased, with slow growth projected across most export areas.

“The milk supply export engine never fully fired on all cylinders in 2023, and it fell by 0.2 percent year on year in the third quarter,” said Michael Harvey, senior dairy analyst at Rabobank. “Year-over-year milk production from the Big 7 exporting regions is expected to fall through the first quarter of 2024 before turning positive.” Overall, milk supply is expected to increase by 0.3 percent this year.”

Other things to keep an eye on in 2024 include a modestly lower grain and oilseed price expectation, El Nio and weather-related concerns, mixed animal markets in export areas, and the influence of the Israel-Hamas conflict on global markets.
A sluggish price recovery

In local currencies, farmgate milk prices in the export zones will end 2023 anywhere from 20% to 40% lower than they began the year. However, with the prospect for 2024 feed costs improving, several regional milk prices have lately climbed, bolstering farmgate profits.

“We expect a slow recovery in dairy commodity prices back to long-term averages,” Harvey went on to say. “However, current fundamentals are ideal for price volatility and potential market whiplash.” Geopolitical instability threats, fluctuating energy markets, and bad macroeconomic circumstances will all be factors to consider for global dairy markets in 2024.”
There will be some demand unpredictability in the future.

With significant dairy inflation, wider cost-of-living difficulties, and low consumer confidence still on the horizon, demand will be a major aspect to monitor in 2024. Peak food and dairy inflation has gone, but market uncertainty persists, and growing unemployment will have an even greater effect on buying power in 2024. The most vulnerable are emerging markets and low-income families.

Consumer prices in China are lowering, and restaurant recovery is continuing, but total consumption growth is slow. China’s demand for dairy commodities is projected to drive any Oceania commodity price rise in 2024. “Rabobank expects China’s import volume to flatline in 2024, which would be a positive result, given the previous two years of withdrawal from the global markets,” he says. “This is an opportunity for importers outside of China to build stocks in 2024.”

Efforts to reduce the milk supply could be counteracted by lower cheese prices.

Milk production is expected to fall this year and next due to lower cow numbers and output. Based on current prices, the department’s December supply and demand report reduced butter and cheese price forecasts for this year. The price of nonfat dry milk was raised, but the price of whey remained unchanged. Lower cheese and butter prices lowered the Class III and Class IV price forecasts.

The USDA reduced its expectations for cheese prices in 2024, while raising those for butter, nonfat dry milk, and whey. Because of lower cheese prices, the Class III price was reduced. Following higher butter and nonfat dry milk forecasts, the Class IV price was raised.

This year’s all-milk price fell a dime to $20.60 per hundredweight, while the 2024 forecast fell 55 cents to $20.25.

Dairy Methane Action Alliance’s declaration at COP28

To minimize emissions on farms, the Environmental Defense Fund has announced the formation of the Dairy Methane Action Alliance with food sector businesses.

Katie Anderson is EDF’s senior director.

“The Alliance’s founding members include some of the biggest companies in the dairy sector, including Bel Group, Danone, Kraft Heinz, Lactalis USA. and Nestle,” she said. “Together, they’re going to set a new benchmark for transparency, accountability, ambition, and action within the food industry.”

The corporations have agreed to monitor and publicly publish their methane emissions, as well as develop a strategy to minimize methane emissions by the end of next year.

According to Chris Adamo of Danone, farms cannot make the investments on their own, and their firm has been collaborating to discover solutions that meet the requirements of individual farmers.

“We work with the farms to hear what they want to install, what works for them and their farms,” he said. “If it’s a small farm, if it’s a farm in a wet Upper Midwest geography, if it’s a farm in an arid Western area—they all may have some different needs.”

Danone vowed earlier this year to cut methane emissions from its fresh milk supply chain by 30% by 2030.

The Alliance is being created as part of the promises made at the United Nations Climate Change Conference COP28 in Dubai this week.During COP28, the Dairy Methane Action Alliance was formed.

US dairy organizations say USMCA announcement a major setback

Several dairy groups are dismayed that the United States-Mexico-Canada Agreement (USMCA) dispute panel is enabling Canada to limit the dairy access that the US bargained for in the deal, undermining the agreement’s worth to the US dairy sector.

“It is profoundly disappointing that the dispute settlement panel has ruled in favor of trade obstruction rather than trade facilitation,” said Jim Mulhern, president and CEO of NMPF, in a press statement.

In January 2022, a previous tribunal decided that Canada had unfairly blocked access to its market for US dairy goods. In response, Canada made inadequate reforms to its dairy tariff rate quota (TRQ) system, resulting in a result that fell well short of the market access sought by the United States under the USMCA. To overcome this deficiency, the United States filed a second lawsuit to oppose Canada’s reforms. The three-member tribunal constituted under the USMCA verdict last week determined that Canada had not behaved unreasonablely.

“Despite this independent panel’s negative ruling, we’d like to thank the Biden Administration and the many members of Congress who backed us up in our tireless pursuit of justice for America’s dairy industry.” “We urge Ambassador Tai and Secretary Vilsack to consider all available options to ensure that Canada stops playing games and follows through on what was agreed upon,” Mulhern said.

“Despite the conclusions of this report, the United States continues to have serious concerns about how Canada is implementing the dairy market access commitments it made in the agreement,” said U.S. Trade Representative Katherine Tai in a statement.

Edge Dairy Farmer Cooperative, one of the country’s major dairy cooperatives, also voiced dissatisfaction with the decision of a dispute resolution body formed under the US-Mexico-Canada Agreement. U.S.

“The dairy industry in the United States was optimistic that the USMCA would bring new opportunities, but both parties must follow the rules.” We are upset by the decision, but we do not consider this matter to be resolved. “US trade officials must continue to find ways to uphold Canada’s — and all US trade partners’ — commitments under trade agreements,” Edge Dairy President Brody Stapel said. “The USMCA promised opportunity for American dairy farmers, with an estimated 50% increase in export value each year.” Unfortunately, high-quality dairy product producers are still unable to get their product onto Canadian grocery store shelves. Edge is committed to assisting US trade authorities in charting a course forward on this problem.”

“We will continue to work to address this issue with Canada, and we will not hesitate to use all available tools to enforce our trade agreements and ensure that U.S. workers, farmers, manufacturers and exporters receive the full benefits of the USMCA,” he added.

According to dairy industry organizations in the United States, Friday’s declaration was a severe setback.

“This ruling has unfortunately set a dangerous and damaging precedent,” said Krysta Harden, president and CEO of the United States Dairy Export Council.

More than a quarter-century ago, the North American Free commerce Agreement altered the terms of commerce between the three nations. Mexico’s borders have largely been opened to free commerce, resulting in a flood of imports, especially from the United States. Canada, on the other hand, has shielded its markets from US milk supply, which vastly outnumbers what Canadian farmers produce.

U.S. dairy market access case dismissed by USMCA trade panel

According to an official report released on Friday, a trade dispute resolution panel established under a key North American free trade agreement has rejected a US allegation that Canada is illegally restricting access to its dairy market.

The US has accused Canada of failing to satisfy its duties under the 2020 US-Mexico-Canada Agreement to open its market to international manufacturers.

The three-member independent panel determined that Canada had not behaved arbitrarily. Their report was made public on Friday.

In a statement, US Trade Representative Katherine Tai said she was “very disappointed” with the verdict.

“The United States continues to have serious concerns about how Canada is implementing the dairy market access commitments it made in the Agreement … we will not hesitate to use all available tools to enforce our trade agreements,” she said in a statement.

Trading partners claim that, although Canada has committed in a number of agreements over the years to grant foreign businesses some dairy market access via a system of tariff-rate quotas, it has been unlawfully assigning the majority of these to local enterprises.

“Canada is very pleased with the dispute settlement panel’s findings, with all outcomes clearly in favour of Canada,” said Trade Minister Mary Ng in a statement.

An previous USMCA tribunal concluded in January 2022 that Ottawa had broken the agreement by not opening up the domestic market enough. Canada later changed its policies.

The USMCA pact maintained Canada’s decades-old supply management system, which limits domestic output of dairy, eggs, and poultry to stabilize dairy farmers’ earnings and shield them from high-tariff import competition.

The nearly 10,000 dairy farmers in Canada comprise one of the most powerful political groups. The majority of farms are located in Quebec and Ontario, the provinces with the most parliamentary seats.

Report on Milk Production in the United States for October Shows Lackluster Results

The October 2023 USDA Milk Production report showed a 0.5% decrease with 18.7 billion lbs. of milk, indicating little change from the previous year. Following suit, milk output per cow fell by 3 pounds in the 24 main states.

Milk cows on farms in the 24 main states were 8.91 million, 19,000 less than in October 2022 and 5,000 fewer than in September 2023. This is the ninth consecutive month of declining cow numbers, and the lowest herd since January 2022.

“While the headline figure was a little lower than we expected, the basic story hasn’t changed much,” Ever.Ag Insights president Phil Plourd says. “Fewer cows and some lingering weather impact continues to translate into mediocre milk production performance.”

Plourd believes it’s difficult to predict how things will change in November.

“While we continue to keep an eye on the very low slaughter activities. Could cow numbers stabilize in the coming months? “Will output in the Southwest find its footing as we move past bad weather and into easier comps?” he questions.

Club One Billion Pounds

The one billion pounds of milk club was made up of six states, with a mix of rises and declines.

  • California produced 3.317 billion pounds, 88 million pounds less than the previous year (-2.6%) and with 10,000 fewer cows.
  • Wisconsin: 2.692 billion, an increase of 23 million pounds (0.9%) with 1,000 fewer cows.
  • Idaho: 1.384 billion, a 19 million pound (-1.4%) decrease with 2,000 additional cows.
  • Texas: 1.381 billion, a decrease of 27 million (-1.9%) from the previous year, with 20,000 fewer cows.
  • New York: 1.348 billion, up 28 million (2.1%) over last year, with 3,000 more cows.
  • Michigan: 1.010 billion, a rise of 26 million pounds (2.6%), and 11,000 additional cows.

New Mexico, with 24,000 fewer cows, saw the second-largest output loss (52 million lbs., 9.0%). South Dakota, on the other hand, added 24 million pounds (6.6%) and 13,000 cows.

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