Dairy Farmers Remain Resilient in 2019

Tom Gallagher, Chief Executive Officer, Dairy Management Inc.

Tom Gallagher

“Resilience” could be the word of the year for America’s dairy farm families in 2019. While on-farm prices have rebounded, farmers tell us that business is still challenging, but the overwhelming message has been that you are resilient and that you will go on.

Your resilience and dedication inspire us at the checkoff to work on your behalf, looking every day for ways to continue to increase demand for milk and other dairy products while finding new ways to build trust in the work you do on your farms.

We strive to be every bit as resilient as you, even as some people who want you out of business try to divide farmers and question the effectiveness of what we do. I figure that means they know the checkoff is the one force that can speak most effectively on your behalf.

At this year’s annual meeting in conjunction with the National Milk Producers Federation (NMPF), we shared how we are constantly working together to protect America’s 37,000 hard-working dairy farm families and to promote your story.

While we cannot directly impact your price, we can and do impact demand for your milk, which plays an important role in price. Fact is, we’ve seen 20-plus years of per capita dairy consumption growth, as milk production has increased and U.S. population growth has slowed.

Here are some highlights of what we’ve been doing to keep demand rising:

Category leaders’ heavy investment in your products. Foodservice partners including McDonald’s, Pizza Hut and Taco Bell have invested more than $100 million into efforts that offer more dairy-friendly menu choices to their loyal customers. A large contributing factor to their investment are the checkoff dairy food scientists working onsite in close partnership with these companies to help keep dairy front and center on their menus.

More school breakfasts that include dairy. Through Fuel Up to Play 60, a National Dairy Council partnership with the NFL that has USDA support and funding through GENYOUth, we’ve been getting more nutritious and delicious foods – including dairy – to America’s schoolkids. To the tune of 3 billion more school breakfasts since we began focusing on this avenue.

Fluid milk revitalization. Beyond kids and schools, we know that adults also have wanted a change in how fluid milk is offered to them. We no longer can rely on a 1950s mindset of serving milk out of a gallon every night at dinner. We are working with a variety of retail and foodservice partners – think McDonald’s Milk Jugs and fairlife – to reinvent milk beyond the traditional bulky white gallon, including new flavors, in new packaging, offered in new places. This already has resulted in 1.3 billion pounds in cumulative new product sales and $250 million in additional consumer advertising and marketing investments.

More U.S. dairy bought overseas. While we have enjoyed 2.5 percent growth in domestic sales this year, exports have provided a highly valuable market. Today, between 15 and 16 percent of American milk now flows overseas in a variety of ways, from milk to powder to cheese and other products, thanks to the strong leadership of former USDA Secretary Tom Vilsack and his staff at the checkoff-founded U.S. Dairy Export Council (USDEC).

 





 

One voice promoting and defending dairy. Working closely with NMPF, USDEC, the International Dairy Foods Association (IDFA), MilkPEP, various co-ops, and others, we present a united front that keeps our eyes on the needs of America’s dairy farm families and the larger dairy industry. A healthy and whole dairy community is good for all of us.

What’s next?

Based on what we hear from dairy farmers on our board and elsewhere, 2019, especially the back half, has been better, but there is – as always – the future to consider. That’s why we have begun a comprehensive look at where we need to be not only in the next year or two, but in the next decade.

In an initiative called “Dairy 2030,” the checkoff is bringing together the best thinking in the dairy industry, academia and business to talk through possible future scenarios about farming, processing, consumers and technology that can impact how we all ensure a strong future for dairy and dairy farming in a constantly-changing market.

We are all aware of the headwinds we face, but like you, we remain steadfast and resilient in our belief that dairy will prevail. That’s the reason your dairy promotion checkoff is here, and we will continue to fight for consumer demand and your right to produce the best products on Earth.

Thanks for your inspiration, and let’s have a successful 2020.





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