We all have heard that growth in the dairy industry is slow, if happening at all.
While this may be true, there are certain areas within the industry that are experiencing positive changes and growth. How responsive Pennsylvania’s dairy leaders are to these trends will most likely shape the future of our industry.
According to GreyB Services, a research and development firm, there are 11 trends in dairy that appear to be the greatest influences of change. Those 11 can be divided into high, medium and low impact as identified below.
• High impact: plant-based beverages, low-sugar dairy, dairy-based snacks and functional dairy foods.
• Medium impact: greenhouse gas emissions, lab-based dairy, and blockchain-based dairy supply chain.
• Low impact: improved livestock monitoring, enhanced cheese production, innovations in transportation, and mastitis management.
I suppose that a producer or processor might reorder what is in these three categories depending on what the respective operation is facing at any point in time. Unfortunately, I only have space to address a few of the high impact trends.
In 2019, while the nation’s largest dairy processor was filing for bankruptcy, the market for plant-based beverages increased by over 5%. There is no cause-and-effect relationship implied here, but the Dean Foods bankruptcy was indicative of a crisis in the dairy industry that many are still experiencing.
As I have stated on so many occasions, we need to do a better job of touting the nutritional benefits of dairy products as compared to the plant-based beverages.
Snacks and Nutraceuticals
The notion of dairy-based snacks is certainly something I can sink my teeth into. Some recent data show why the daytime snacking trend has some important implications for the dairy industry. For one, 81% of college students surveyed by a national food service company said they want healthy, convenient snacks that they can grab anytime.
Adults are following similar patterns, based on data from Dairy Management Inc. Seventy-five percent state they consume morning snacks, and the numbers consuming afternoon snacks has increased to 91%, from 65%.
This trend of increased snacking provides an opportunity for innovation and creativity within the dairy industry. Dairy-based snacks would have a high nutritional profile, giving them an advantage over more conventional snacks.
Functional foods, or nutraceuticals — those terms are not familiar to many of us — are believed by GreyB to have much potential for growth.
Nutraceuticals are a group of products that are more than food but less than pharmaceuticals. There is no accepted definition of these products on an international level, and each country defines and regulates them. Nutraceuticals are often seen on the market as supplements.
Investments by large dairy companies such as Nestle and Danone have been made in functional foods research and development, ergo the belief in their potential. Fermented dairy foods are expected to be a leader in new products added to the market.
It is also widely believed that low-sugar dairy products will see steep rises in consumption. Reduction of sugars has been a thorn in the side of many dairy processors, and the trend to increased consumption necessitates some innovations in this area. It is difficult to reduce sugars without also reducing flavor, texture and color. Consumers can be a finicky bunch.
The Pennsylvania Milk Marketing Board recognizes that awareness of these trends and others is an important first step in moving the dairy industry forward. We support efforts to innovate and create new products to meet changing demands of consumers.
We are also available to respond to questions and concerns. I can be reached at 717-210-8244 or by email at firstname.lastname@example.org.