Covering Ag since 1981. The faces, places, markets and issues of dairy and livestock production. Hard-hitting topics, market updates and inspirational stories from the notebook of a veteran ag journalist. Contributing reporter for Farmshine since 1987; Editor of former Livestock Reporter 1981-1998; Before that I milked cows. @Agmoos on Twitter, @AgmoosInsight on FB #MilkMarketMoos
As a mother and a grandmother, Sherry Bunting has followed childhood nutrition legislation and government guidelines for 25 years. She is pictured here recently with Bella, one of her five grandchildren.
By Sherry Bunting, Farmshine Cover Commentary, April 26, 2019
I have been following and writing about the nutrition exploits of the National School Lunch Program since 1994. At that time, my children were in school, and I served as an elected director of the Eastern Lancaster County School Board.
Today, I continue the fight because I see the effects. I am a grandmother. I have been on this soapbox whether milk prices are high or low, though some say I’m just conjuring up devisive issue because of low milk prices.
My track record on this issue is 25-years-long-and-solid.
The problem started surfacing in the mid-90s when the low-fat / high-carb nutrition dogma became firmly entrenched, and big food brands were pushing low-fat versions that contained – you guessed it – more sugar and concentrated high fructose corn syrup.
The situation became progressively worse through the 2000’s as the government began tightening its vice-grip — as one foodservice director at the time put it — “forcing us to serve the equivalent of a heart patient’s diet to growing kids.”
Foodservice directors who piloted the USDA software for the nutrient standard menu planning said it would be an obesity disaster in the making. They correctly noted that when fat is removed from diets, carbs and sweetener take its place.
There are three things that give food calories for sustaining life: Fat, carbs and protein. There are two calorie-providing elements that give food its flavor: Sugar and fat.
By excessively reducing fat, the flavor of the meals and the milk is reduced, and children are pushed toward more sugar and less feelings of fullness.
By removing whole milk, real butter, real cheese, real beef, we now have 10-year-olds with ‘hunger pangs during math class.’ Sen. Stabenow recognized this, but she doesn’t grasp why. She sees the solution as more of the same: Just find ways to get more kids enrolled to eat even less of what’s good for them.
The 2010 Healthy Hunger-Free Kids Act made “historic changes” alright. Bad ones. It dealt our nation’s dairy farmers and children the final blow. It limited the calories of the total meal, tightened the saturated fat limits, and required only fat-free and 1% milk or fat-free flavored milk be served along with offerings of fruit juice and water. It also increased the carb counts.
What our government leaders and USDA nutrition elite bureaucracy think is progress is actually regression. Sen. Stabenow says ‘don’t go backwards.’ But our children are already going backwards as nutrient dense foods are limited.
I find it amazing that our political leaders can sit in committee examining childhood nutrition programs costing $30 billion in reauthorization and talk about the nutritional crisis our nation is facing that affects our national security and yet claim that the 2010 Act brought “progress”, saying “don’t backtrack”.
In essence, our leaders believe the problem is not enough kids are enrolled in the programs that they have ruined!
Instead of hiring market research firms to find out how to get more participation, change the program. Apply some logic.
The School Lunch and later breakfast programs began when the military in the 1940s saw malnutrition as a national security issue among recruits. At that time, the biggest thing the school lunch program did was to make sure children received whole milk, real butter, real cheese, real beef, real food. And yes, we ate our vegetables, they had real butter or cheese on them!
We sailed along until Dr. Ancel Keys from the University of Minnesota, and his now heavily-challenged hypothesis, became the darling of the American Heart Association. By the 1980s, it was intrenched. Other rigorous science was bullied and buried.
By the 1990s, school lunch rules became more intrusive in reducing fat and increasing carbs.
By the 2000s, schools had to submit their menus for approval or run them through USDA software for percent-of-calories-from-fat analysis. School foodservice directors admitted to serving more dessert to replace the calories lost from nutrient-dense fats and proteins, but they used applesauce, more sugar and high fructose corn syrup — instead of butter and eggs — to make those cakes, cookies and brownies.
In 2010, the government limited the lunch calories, tightened the saturated fat limits, and outright forbade serving 2% or whole milk in schools.
Don’t our leaders see that we keep making a bad situation worse because we can’t admit that it’s time to backtrack?
Now our military says recruits are too obese to serve. We are facing a new national security threat. This is no joke.
When will our nation have a full airing of the science? When will we backtrack from a hypothesis disproven?
Since the 1990s — and even moreso since 2010 — our children are served increasingly less of less, and we have a USDA and a Congress that want to stay on this road and just make sure more of us travel it. In fact, while USDA representatives told Congress last week that they don’t want schools and states to have to be ‘food police’, they admitted they look at ‘competing foods’ to see that kids aren’t leaving the lunch line to eat or drink something else on campus.
Pennsylvania and other states will not allow various FFA groups to put in whole milk vending machines and manage them as a fundraiser, or they must be locked during school hours in order not to “compete” with what government is literally forcing down our children’s throats, or into the trash can.
If the federal government won’t do what’s right, then get out of the way and let our communities decide how to feed our children. Stop ruling from the ivory tower that “looks and listens” but fails to act. Change the Guidelines. Face it. Do it. Now, before it’s too late.
Military insights suggest backtracking, but disappointing answers given on school lunch and milk fat
By Sherry Bunting,Farmshine, April 26, 2019
WASHINGTON, D.C. — The last time a childhood nutrition authorization was passed by Congress was in 2010: The Healthy Hunger-Free Kids Act. A decade later, the Senate Ag Committee held a hearing last Wednesday (April 10) on perspectives in childhood nutrition.
Chairman Pat Roberts (R-Kan.) said this is the first step in the reauthorization of the $30 billion in mandatory and discretionary childhood nutrition programs he wants examined and passed this year.
The hearing panels included representatives of federal agencies, state and community food programs, and the national childhood health program.
Most of the discussion centered on ways to streamline programs, increase enrollment that has been declining since 2010, and provide more flexibility.
There were a few eye-opening highlights and some discussion related to milk.
Chairman Roberts said in his opening statement: “One size fits all does not work for all.
Ranking Member Debbie Stabenow (D-Mich.) stated that, “Whether it’s a mother getting enough calcium to insure healthy bones for her baby, or making sure a 10-year-old isn’t fighting hunger pains in math class, child nutrition is about building a stronger future. It’s also important to our national security.”
Stabenow then revealed how and why the National School Lunch Program began 80 years ago, and what the concerns are today — two decades after the saturated fat limitations were introduced and a decade after the last reauthorization under the leadership of President Obama and Secretary Vilsack, when the screws were further tightened on milk choices and other aspects in 2009-10.
“Interestingly, the National School Lunch program was created in the 1940s because General Lewis Hershey came before Congress to explain that recruits were being rejected due to malnutrition,” said Stabenow.
Sen. Debbie Stabenow (D-Mich.)
“Today, over 750 retired Generals, and other military leaders, are sounding alarm bells again, this time because young adults are too overweight to serve,” she stated. “With 14% of children as young as 2 showing signs of obesity, we have to address this issue early and everywhere.”
That said, Sen. Stabenow touted the “tremendous progress in the past 20 years in schools and daycares. It is vital to move forward, not backward,” she stated, while in her next breath saying that “obesity in adolescents continues to rise while over 12 million kids do not have enough to eat.”
She touted the need for greater enrollment in the National School Lunch Program so kids can have access to that “better” lunch, breakfast, after school snacks and even supper. She talked about a “veggie van” driving out into communities. She cited the Women Infant and Children (WIC) program as critical to first stages of life.
But when her opening statement was said-and-done, Sen. Stabenow again touted “the progress made in 2010” and said several times “we don’t want to backtrack while streamlining these programs.”
Sen. Bob Casey (D-Pa.)
Toward the end of the session, Senator Bob Casey (D-Pa.) brought up “the science of milk” and addressed his question specifically to Dr. Olanrewaju Falusi, a pediatrician who is director of the Children’s National Health System in Washington, D.C.
It was not surprising that the most important question of the day got the most disappointing and predictable answer.
After hearing Dr. Falusi present her comments about how early childhood diets are responsible for critical programming of lifelong metabolism, brain development, and educational outcomes, Sen. Casey addressed Dr. Falusi as follows:
“There’s been much discussion in Pennsylvania about the ability of schools to serve whole milk to students. What does ‘the science’ say about the appropriate levels of whole milk consumption?” the Democratic Senator from Pennsylvania asked.
Dr. Olanrewaju Falusi, a pediatrician who is director of the Children’s National Health System in Washington, D.C.
Predictably, Dr. Falusi replied: “As a pediatrician, I recommend to my patients that they drink water or low-fat or fat-free milk. We know that milk has many benefits from protein and calcium and Vitamin D. We also know, though, that lower fat and lower sugar in diets are healthier for children.”
Dr. Falusi continued matter-of-factly: “What we would admonish, from the American Academy of Pediatrics, is that the standards for school nutrition programs — including the type of milk served — really be based on the science, and the science is that lower fat and lower sugar are what we should be advocating for children. And we do encourage the USDA to rely on the nutrition experts and to look at a number of studies for those guidelines.”
Senator Deb Fischer (R-Neb.) asked about students turning to competitive foods when the school lunch does not appeal or satisfy. She addressed her concern to USDA Acting Deputy Under Secretary for Food, Nutrition and Consumer Services, Brandon Lipps.
Lipps replied that the government seeks a balance between the school lunch and “competing foods” allowed on campus. He also noted they are “looking to see that kids are not leaving the school lunch line to buy competitive foods elsewhere on campus. But we’re not making the schools or states be the food police.”
Sen. Fischer asked: What are the foodservice professionals telling you? Are kids eating the school lunches?
Brandon Lipps, USDA Acting Deputy Under Secretary for Food, Nutrition and Consumer Services
Lipps replied that the “schools are very positive on the flexibilities in the final rule… It’s not a major change, just a comfort in long-term planning. Schools have to buy a long way out to plan their menus in the way that we require them to do. So they’re glad to have finality on the flexibility” (for example, they have flexibility to serve 1% flavored milk instead of only fat-free).
In response to the suggestion that the nutrition standards are “no good.” Lipps stated that, “We put in a calorie limit in 2009, and if the kids don’t eat half the food on their plate, and if they are getting half of the maximum calories that we provide them, if that’s happening, then that’s a problem.”
USDA is monitoring this, said Lipps: “As you know, the same is true, particularly with milk and the nutrients that it provides, so we are going to continue to listen and see if further flexibility is needed on that front.”
Repeatedly, the 2010 Healthy Hunger-Free Kids Act was cited for making “historic changes” that led to “greater consumption of fruits, vegetables and whole grains as encouraged by USDA.” But at the same time, panelists repeatedly said fewer eligible families and children use the programs today compared with before 2010, and that obesity and diabetes and hunger are rising in our youth.
When asked by Sen. Joni Ernst (R-Iowa) about school waste related to the 2010 changes, USDA Under Secretary Lipp said flexibility in the final rule on whole grains, sodium and 1% low-fat flavored milk went a long way toward changing that.
“I don’t think we have anyone telling us we need a major change in the nutrition meal pattern requirements for the school meal, but they do want flexibility,” said Lipp.
Sen. Ernst also noted the concerns about portion sizes being the same for a first-grader as an eighth-grader. “School foodservice professionals say they want the flexibility to vary it,” she said. “Right now, booster clubs are bringing in food for athletes who are not getting enough. And with mandated portions and mandated nutrition requirements, we are seeing a lot of food waste, what can USDA do?”
Lipp replied that USDA will continue to “look and listen.”
Josh Mathismeier, Director of Nutritional Services for Kansas City public schools and Mike Halligan, CEO of God’s Pantry Food Banks, based in Lexington, Kentucky, said participation would increase if they could take the food to the people instead of forcing the people to congregate to access the food.
Some states have actually hired market research firms to do focus groups with eligible families to learn how to increase their enrollment.
The 2016 report touts a $5 to $1 return, but here is a deeper look. More transparency needed, sought
By Sherry Bunting, Farmshine, April 5, 2019
WASHINGTON, D.C. — USDA released the 2016 Dairy Checkoff Report to Congress on April 1, and it focuses on quantifying the return dairy farmers received for their 15 cents per hundredweight — over $320 million collected annually — in mandatory checkoff investment.
Well, not really.
The headliner is that farmers received a $5 to $1 return on their promotion dollars. But let’s look a little deeper.
The $5 to $1 return is an evaluation made by the independent analysis of Texas A&M based on the dollars spent on “demand enhancing” and “promotion” activities, not a return on investment calculated on all dollars mandatorily invested by dairy farmers.
Digging into the charts, this puts the evaluated dollars at around $250 million, and that includes the processor funds in the MilkPEP program. The total dairy farmer checkoff of 15 cents per hundredweight amounts to $320 million annually and the MilkPEP processor funds are close to $94 million annually, according to the report.
Meanwhile, a bipartisan bill was introduced in the U.S. Senate to bring transparency to checkoff programs for all farm commodities. The bill — Opportunities for Fairness in Farming (OFF) Act — was reintroduced a week ago by U.S. Senators Mike Lee (R-Utah), Cory Booker (D-N.J.), Rand Paul (R-Ky.) and Elizabeth Warren (D-Mass.).
According to an advocate of the bill — the Organization for Competitive Markets (OCM) — the OFF Act would put an end to the “most egregious abuses” committed by the boards and contractors of the federally mandated commodity checkoff programs.
OCM states that, “Checkoff programs have fallen under the control of commodity trade organizations representing global agribusiness interests,” noting that “farmers are struggling amidst increasing consolidation, low commodity prices, and excess supply. Net farm income is at a 19-year low. Along with recent trade disruptions and natural disasters, such as the flooding in the Midwest, the last thing farmers want or need is their tax dollars working against them.”
The OFF Act is intended to “rein-in conflicts of interest” and “stop anti-competitive activities” by forcing checkoff programs to publish their budgets and undergo periodic audits so that farmers and ranchers know where their mandatory checkoff dollars are going. It would also stop federally-mandated checkoff dollars from being transferred to parties that seek to influence government policies on ag issues and increase the transparency of the individual boards’ actions by shedding light on how these funds are spent and the purpose of the spending.
In light of this new bill, let’s look at the 2016 Dairy Checkoff Report to Congress released on April 1.
According to the 2016 Report’s executive summary, “… the combined effects of 2016 promotion activities on the consumption of fluid milk, cheese, butter, all dairy products, and dairy exports includes benefit cost ratios (BCRs) for dairy producers, dairy importers and fluid milk processors. For every dollar invested in demand-enhancing activities, the BCRs for producers were: 1) fluid milk $4.11, 2) cheese $4.81, and 3) butter $22.74, 4) exports $8.10. The BCR for fluid milk processors attributed to fluid milk promotion activities is $3.73. And the aggregate BCR on every ‘demand-enhancing’ dollar spent was calculated at $4.78.
Putting those BCR’s in perspective, the 2016 Report totaled the mandatory dairy promotion contributions at $415 million, of which $94 million was contributed by the Milk Processors Education and Promotion Program (MilkPEP), which are the funds paid by fluid milk processors for fluid milk promotion.
When looking at the graphs accompanying this report — since the report does not include the raw data points for 2016 — the total amount of domestic dairy demand-enhancing funds from which the BCRs (aka returns on investment) were calculated, comes out to around $250 million for the year. And a large chunk of that came from the fluid milk processors (over $80 mil).
From 1996 through 2016, the amount of money collected topped $7 billion, according to the report.
During those 20 years, the dollars spent on “demand-enhancing” activities for fluid milk have declined, and the fluid milk sales have declined also. Of the roughly $110 million spent on fluid milk demand-enhancing activities in 2016, most of those dollars came from MilkPEP generic promotion.
Also, keep in mind that the fluid milk sector is the sector held most notably to the standard of “government speech” in its “allowable” promotion i.e. the low-fat and fat-free USDA Dietary Guidelines that have precipitated the decline in fluid milk consumption.
In fact, whole milk sales rose in 2016 while the entire fluid milk category fell. But whole milk was not promoted with any of the producer or processor promotion funds overseen by USDA and evaluated in this report. Consumers chose whole milk based on external factors that are driving the discussion of fats and proteins in the diet.
The fastest growing demand-sectors in recent years include butter. The 2016 Report to Congress states that farmers received a $22 to $1 benefit cost ratio (BCR, aka return on investment) in that category.
That looks really great, right?
But again, this is based on the amount of “demand enhancing” funds actually spent on butter promotion in 2016 — right around $8 million for the year — the lowest category of all product promotion sectors to receive promotional funding, but the fastest rising in demand and value.
Put simply: Very little of the dairy farmer’s promotion funds (less than 2% of total checkoff funds) were used to promote butter, but sales have risen so fast in that category that the return on investment seems to be quite impressive. The “return” may have nothing to do with the “investment” under this scenario.
Meanwhile, Dairy Management Inc. (DMI) has continued consolidating the way it uses its national share of individual farms’ mandatory checkoff funds through business-to-business (B2B) partnerships where the goal is to influence the amount of dairy utilized by the top restaurant chains, pizza chains, and other foodservice companies in what they offer to consumers. This may become increasingly important as the government dietary guidelines and other factors pressure companies to use more plant-based options. But the drawback is that this B2B use of dollars feeds into further consolidation of the industry in terms of geographic winners and losers.
The key to looking at the 2016 Report’s BCR (returns on investment) calculations is the choices consumers are making where they actually have choices. Consumers are choosing whole milk and full-fat dairy at rising rates. Where they don’t have a choice, the low-fat and fat-free versions are enforced and offered. So while $110 million might have been spent by farmers and processors to enhance fluid milk demand, precious little, if any, has been used to promote the whole milk message due to USDA oversight of all advertising messages.
Part of the other half of checkoff funds not included in the “demand enhancing” and “promotion” BCR (return on investment) calculation is in dollars funneled toward the Innovation Center for U.S. Dairy.
What is the Innovation Center, farmers wonder?
The Innovation Center is the part of DMI that is considered “pre-competitive.” This includes new product development, like fairlife.
The Innovation Center also includes the FARM program that governs animal care standards and is increasingly seen as a methodical tool to control and cull dairy farmers by management style. Dairy producer checkoff funds have paid for the FARM program through DMI’s Innovation Center even though National Milk Producers Federation (NMPF) implements and administers FARM with DMI paying NMPF for certain services and NMPF paying DMI for other services.
The Innovation Center also includes the “sustainability” standards being set for FARM in conjunction with World Wildlife Fund (WWF) to streamline the dairy “industry” for WWF’s sustainability stamp-of-approval.
Both links are housed by WWF’s website and WWF is also working in alliance with the beef checkoff to set sustainability parameters for U.S. cattlemen as well.
Meanwhile, HSUS is among the proponents of the OFF legislation introduced by Senators a week ago. This is the counter we here, how farm organizations seeking competitive markets are working on the same side with HSUS.
For the record, Dairy Checkoff and Beef Checkoff are working with WWF, and WWF is barely one step away from HSUS in terms of having an anti-animal-use agenda.
Both organizations seek to greatly decrease, or end, the use of animals for food, work, etc., and they seek the re-wilding of lands where farmers and ranchers have gone out of business to accumulate massive sanctuaries for wild animal proliferation while working in close partnership with EAT Lancet-supporting companies to shift the U.S. diet away from animal products to plant-and-laboratory-based-imitations.
What is missing in the “sustainability” discussion that farmers are helping to pay for with their checkoff dollars through their dairy and beef boards is the truth that the plants need the animals and the animals need the plants and we humans need them both for healthy bodies and a healthy planet.
What is also missing is the food security and regional economics of the food industry consolidation that is occurring in the name of “sustainability” through the very checkoff-funded “sustainability” programs that are being developed to appease groups like WWF.
If companies want to consolidate and streamline this way, that’s free market enterprise. They are free to do so. But should farmer checkoff funds be helping to pay for it?
For example, dairy farmer checkoff funds were used — according to the 2016 Report to Congress — to develop a variety of programs aimed at transforming the industry. This has been going on since 2009, according to the Report.
This means a portion of the dairy farmer checkoff funds collected from all dairy farmers on all milk from 2009 through 2016 has gone into developing programs that are not considered demand-enhancing and that are — in effect — picking winners and losers within the dairy farming sector.
These funds have been used to implement aspects of FARM in animal care and environmental sustainability.
These funds have been used to launch programs to reduce greenhouse gas emissions across the dairy supply chain, including a “fleet smart” program that touts its ability to help processors and cooperatives transform their trucking and distribution.
Read that sentence again. What does it mean?
Dairy farmers have funded — through mandatory checkoff — the development of the very programs that are streamlining and consolidating their industry in the name of so-called “sustainability.” As proprietary and co-op processors adapt the transportation and distribution ‘fleet smart’ modules, farmers are, in essence, paying for that with checkoff funds and other assessments put on them by their cooperatives, and in turn, those transformations make some farms desirable and others undesirable simply by size or location.
The invisible hand of the free market picks winners and losers. But in this case, should mandatory dairy farmer checkoff funds be the helping hand to pay for that? To pay for their own demise, in some cases?
It is interesting also to know that USDA is paid for its extensive time and costs to do all of this oversight – paid by these funds to keep the troops in line on toting government speech, among other things.
Here is how the 2016 Report to Congress describes USDA oversight:
“USDA has oversight responsibility for the dairy and fluid milk promotion programs. The oversight objectives ensure the boards and qualifying partners (QPs) properly account for all program funds and administer the programs in accordance with the respective acts and orders and USDA guidelines and policies. USDA reviewed and approved all board budgets, contracts, and advertising materials. USDA employees attended all board and committee meetings, monitored all board activities, and were responsible for obtaining an independent evaluation of the programs. Additional USDA responsibilities include nominating and appointing board members, amending the orders, conducting referenda, assisting with noncompliance cases, and conducting periodic program management reviews. The boards reimbursed the U.S. Secretary of Agriculture, as required by the acts, for all of USDA’s costs of program oversight and for the independent analysis.”
As flood losses mount, and recovery is slow, farmers from across the country are banding together and reaching out to send hay, fencing, other supplies and financial donations to the flood-affected rural communities of Nebraska, Iowa and surrounding areas. Photo by Sherry Bunting
By Sherry Bunting, Farmshine, April 12, 2019
COLUMBUS, Neb. — As the Midwest and Great Plains braced for the unexpected April ‘winter’ storm system, the same region was still walking the long road of recovery from the March blizzard and catastrophic flooding. Four weeks after the ‘bomb cyclone’ hit the Midwest and Plains, the hardest hit areas are just beginning to see evacuation orders lifted.
I was there two weeks after the height of the flooding, and the losses and generosity were both obvious, and both are continuing as flooding remains in the potential forecast while continued convoys of hay, supplies and other donations are pouring in.
During my brief visit two weeks ago, many roads were still closed to non-emergency traffic. Other roads, bridges and infrastructure were so severely damaged that some areas were still partially or completely cut off. Railroads were still halted, and six ethanol plants were shut down.
The extent of the March storm and flooding losses are still being updated with Iowa estimating $1.6 billion in damage and Nebraska $1.3 billion. In addition, an April storm brought losses. In Nebraska, the agriculture losses, alone, are nearly $1 billion – including $400 million in crop and stored grain losses and $440 million in livestock losses. A majority of livestock losses are recently born calves that may not have been tagged or recorded, making documentation difficult. Veterinarians report additional losses ahead as surviving livestock are under stress. Additionally, the transportation infrastructure damages are costing livestock and dairy farms — that market milk and animals daily – a collective $1 million per day due to increased transportation costs in Nebraska, alone. Other concerns are losses of feed and clean water for livestock with estimates of $40 million in livestock feed supply losses in Nebraska.
Untallied bushels of corn and soybeans stockpiled on farms for future delivery were under floodwaters or damaged by them. Land that had never seen flooding previously was still under water.
The Nebraska governor’s office was estimating nearly $1 billion in agricultural losses — not including millions in damage to buildings, homes and equipment. Livestock losses were being estimated at over $400 million, and crop losses both in storage and by prevented plantings were estimated at over $400 million.
While USDA Secretary Sonny Perdue has backed away from a figure he gave Fox News three weeks ago — about one million cattle being lost in the region due to both the blizzard in western Nebraska and surrounding areas and the catastrophic flooding in central and eastern Nebraska as well as Iowa, southern Minnesota, southeast South Dakota and into Missouri — it’s not hard to imagine a number close to that when new spring calves are reported to far surpass any livestock class in the number of losses.
Feedlots and dairies in the region talk about losing average daily gain and milk production in the wake of deep snow, floods and mud. Transportation of commodities into and out of the region is encumbered with dairy farmers, for example, reporting milk trucks taking 90-mile detours and milk being dumped.
In some areas the flood waters were so damaging even the deeply-buried fiberoptic cables have been unearthed as damaged dams and levees unleashed water and ice that in turn damaged bridges, roads and railroads.
In fact, 200 bridges in Nebraska, alone, will need to be inspected, and this has created issues for trucks and rail cars that normally traverse them, creating additional costs getting commodities out and supplies in.
“This thing has long fingers,” said Bill Thiele, a dairy producer near Clearwater, Nebraska. While he describes the losses at his family’s 1900-cow dairy to be “mostly inconveniences,” he sees what his neighboring dairy and beef producers are dealing with.
He operates the third-and-fourth-generation dairy with his three brothers, a sister-in-law and two nephews, and they have another generation coming on.
“We are three miles from Clearwater, and there is destruction along 90 miles of the Elkhorn, which had tremendous flooding, and by the Clearwater Creek, where bridges were lost. We are right beside the Clearwater Creek and are very fortunate the new bridge held,” Thiele describes how 8-inch-deep frozen creeks like the Clearwater raged 15-foot high as the water built up behind the ice like a big dam and unleashed its fury.
“We produce three tankerloads of milk per day. We have no storage on site, we just hoped to keep trucks coming and going to us,” he reflects, noting that they had to shut down for an hour, but that pales in comparison to others. He tells of a nearby dairy having to dump milk for six days straight.
“Milk was definitely dumped in this state. We don’t know how much as the milk haulers eventually established routes going an extra 90 miles per load to make it between farms and plants,” Thiele recounted. “We don’t know of plant closures, but there were points where people may not have gotten to work. One of the first things our Governor did was to lift the weight restrictions, and he worked with the Departments of Transportation and Highway Patrol in other states to synchronize that.”
Thiele tells how one dairy four times his size on two sites just south of Columbus near hard-hit Rising City and Surprise, Nebraska, hired planes to fly employees to locations where they could then pick them up in vehicles to get to the dairies as it was more than one week before the main highway 81 was opened up.
He’s heard about the losses of ranchers and family members – people he knows – who tried coaxing cattle out of fields but had to get themselves to higher ground when the emergency warnings went out as the Spencer Dam broke.
“Cattle are mixed everywhere with bridges out,” said Thiele. “It will take some time to tabulate where cattle are, what was lost, and what’s misplaced. It’s hard to fathom these images of guys loading 40 or so dead calves.”
To fathom it, one must understand that many of these miles of creeks and rivers leading to catastrophic flooding are normally wide and shallow streams that can be crossed easily, but as the floodwaters came up rapidly and dams and levees were breeched by icebergs the size of cars, beef cattle herds in protected areas near streams during calving season, became stranded.
He said the damage to infrastructure in Nebraska even affected the dairies in California “because grain and soymeal and distillers (DDGs) go from here in Nebraska by rail to California.”
With railroads knocked out and ethanol plants shut down, those dairies had to find feed and trucks to get feed out there. “It quickly makes you realize all these things have long fingers reaching out very quickly,” said Thiele.
Without the railroad to bring corn to the ethanol plants and transport the ethanol and DDGs out, at least six ethanol plants were forced to shut down. This has widened the basis for producers in Nebraska and affected usage and pricing, not to mention actual losses of stored commodity.
Thiele notes that while the news reports indicate much cropland under water for seven or more days, some of this land has not seen waters fully recede to begin cleanup or even think of getting ready to plant.
Dairies, he said, would be affected by alfalfa losses. While hay stocks are damaged on many farms and ranches, the alfalfa fields and grasslands also sustained damage from both flood waters and the huge chunks of ice propelled by the rapid snowmelt and precipitation that turned those little streams into raging rivers.
In the midst of it all just two days after Highway 81 re-opened, debris piles were a combination of equipment, hay and even cattle carcasses carried miles on raging waters even two weeks after the worst of the flood had passed Columbus.
While driving through Columbus, a stop in town found the Nebraska Farm Bureau, Nebraska Cattlemen and Nebraska Pork Producers all coming together to provide a grilled meal of pork loin, burgers and hot dogs for volunteers, farmers and town folk on March 24 – a scene oft repeated in other towns in the following days and weeks.
“We wanted to thank the volunteers and help the people suffering with flood damage,” said Steve Nelson, president of the Nebraska Cattlemen. He noted that USDA Under Secretary Greg Ibach, a former Nebraska Ag Secretary, would also be on hand to talk about the damages that can only be fully appreciated from the air.
Suffice it to say that federal assistance won’t do much, and a special disaster aid package for 2018 and 2019 damage across the country failed to pass the Senate last week.
Existing programs like USDA’s Livestock Indemnity Program (LIP) have caps that many farmers’ losses will far exceed. Programs like Crop Insurance won’t cover grain lost in storage. Few have sufficient private insurance for these losses, and many areas affected are not in flood plains, so flood insurance is not available.
Jay Ferris with Nebraska Farm Bureau lives near Seward, Nebraska and had some damage from the Loup River. But it was the Niaroba, Elkhorn and Missouri River convergences that saw the worst of the flooding miles from their respective shores as levees were breeched, dams destroyed pushing the floodwaters and icebergs into these lesser shallow creeks that became deep rivers.
A little-known fact from sixth generation farmer and radio personality Trent Loos, is that Nebraska has more miles of river than any other state. Of course, these rivers are not what most of us think. They are miles of wide and shallow streams – maybe 8 inches to a foot deep as historical channels for melting snow.
As reported earlier in Farmshine, it was the combination of Storm Ulmer’s ‘bomb cyclone’ in early March and the abundant accumulation of snow and ice pack driven by the heavy precipitation that wreaked havoc on systems as icebergs the size of automobiles and several feet thick were propelled over banks by the fast moving runoff, hitting Platte County especially hard and putting over 60 Nebraska counties and over 40 Iowa counties under emergency declaration by state and federal authorities.
“The biggest tragedy was in the calving beef herds wintered close to water where there are big trees that keep them out of the wind,” said Ferris.
“The feedlots lost efficiencies, but our cow-calf operations lost a lot of their babies. That’s the saddest part,” his wife Tammy echoed as they prepared the grills for the meal offering to flood victims and volunteers.
Bill Luckey, a Columbus, Nebraska pork producer and cattleman, talks about the hay operation as the Air National Guard chopper takes off in the early-evening drizzle with round bales to feed stranded cattle and two more semi’s roll in with more needed hay and corn fodder.
“It is incredible the amount of generous donations of hay, fencing and other supplies, as well as money and work crews to clean up and rebuild,” said Bill Luckey, a member of the National and Nebraska Pork Producers boards when we caught up with him at the Columbus, Nebraska hay drop location. “The generosity from all over the country has been amazing.”
As we watched the Nebraska Air National Guard load four round bales to feed stranded cattle owned by Drew Wolf of Richland, Nebraska, we met Jay and Kim Schilling from the southwest corner of the state. They had just brought in 23 round bales, and while some of it was being loaded for airlift, two more semi’s showed up with needed hay and corn fodder from Iowa.
“We are one of the few counties not declared an emergency in our state, and we wanted to help because we know they would do the same for us,” said Kim Schilling. “We know how much those cattle eat.”
Brian Palmer of Columbus, Nebraska, loads the last of four round bales brought in by Jay and Kim Schilling (pictured). They are ranchers from the unaffected southwest corner of the state. Bales are airdropped by Nebraska Air National Guard to cattle still stranded by standing water weeks after the early March storm.
As it turned out, the rancher whose cattle were being fed by that particular airlift belonged to a friend of Jay’s college roommate at the University of Nebraska. They had called that friend as soon as they heard how bad the situation was to the east.
Luckey talked about the flooding around Columbus. He farms six miles east of town and described his operation as “lucky.” The floodwaters came within inches of his hog barn. Active in both the Nebraska Pork Producers and Nebraska Cattlemen Associations, he was busy helping wherever needed after the floods.
“They asked if I could help do this hay drop, so I’m helping Brian Palmer who is running this thing,” said Luckey, who in addition to raising hogs, has a cow-calf herd and did lose a few calves in the stress of it all.
“Even though we don’t know the numbers, everyone in this area has some cattle and hog losses,” said Luckey, noting that the Fremont area, especially had some hog losses. “Roads are covered with water, mud and debris. There’s an awful lot of mud. We’ve seen an awful lot of livestock stress that will continue in this mud. Every 10 to 20 years, we see flooding. In the early 1990s, there was severe damage in some of these parts, but most of us have never seen anything like this.”
What we really need, said one observer, is bridge builders. Transportation is critical here.
As Luckey finished his sentence about the toll the floods have taken on transportation, a train whistle in the distance grew louder. As it passed us by, standing there at the Columbus hay drop watching the chopper lift hay for stranded cattle, Luckey said: “That’s the first train whistle we’ve heard in over 10 days. That is surely a nice thing to see. That looks like a load of coal coming in from Wyoming.”
He talked about the damage to railroads, and I soon learned that the SiDump trucks I had seen going up and down the roads I had traveled the afternoon and evening before were working in earnest for the railroad hauling rock to place under the tracks to fill holes left by the raging waters.
“They say that the closing of the railroad cost Union Pacific $1 million per hour,” Luckey remarked. “Some of our roads were closed just so the equipment and dump trucks could move freely to get the railroad up and running again. It’s our lifeline.”
Southeast of Columbus closer to Sioux City, Iowa, things were bad. Even the I-29 corridor from Sioux City to Sioux Falls was shut down in places 10 to 14 days after the flood. Thiele told of a dairy south of Sioux City with one-fourth of its land under water, and the alfalfa all under the transported ice – not to mention the same conditions for grass that would be grazed or hayed for beef cattle. Hay will be an ongoing need.
This rainbow appeared after a light rain ended near sundown two weeks ago as the author drove through the rural town of Columbus, Nebraska in hard-hit Platte County, where recovery is still an inch-by-inch deal four weeks after the storm. Photo by Sherry Bunting
“Standing water and ice will ruin that multi-year investment in alfalfa, which is absolutely the background ingredient and feedstuff for dairies here,” said Thiele. “Add to this the direct and indirect losses in planting delays and prevented plantings this spring, and that means less feed.”
To gain perspective of the levels of water 11 to 15 feet off the ground, seeing the arial photos of standing water just under the tops of center pivot irrigation systems tells the story.
“There is an incredible amount of snow in South Dakota and we’re still getting snow in Sioux Falls and west. That all has to melt yet,” Thiele observed. “I’m no meteorologist, but that water, that moisture, all has to have somewhere to go.”
Whatever the circumstances that created the perfect storm for catastrophic floods, one thing can’t be denied — the amazing force of water and the destruction and debris it leaves in its wake. Riverbottom pasture and hay ground is filled with sand bars, fields even above a normal flood line are not getting spring or normal warm temperatures. By April 15 to 20, farmers here want to be in the field, Thiele explained.
“But with this much saturation, standing water and debris, some land will go unplanted this year,” he said, adding that a normal first cutting of hay occurs a couple weeks before Memorial Day. “That’s not likely to happen either. If all else goes okay, we’ll be lucky to get by with just one less cutting and less tonnage while some areas will have to replant.”
He talks again about the “long fingers” of this thing, as Nebraska alfalfa grown near him goes to dairies in Michigan.
The response from the agricultural community has been overwhelming. Truckloads — actual convoys of trucks loaded with hay, fencing and other supplies — have been heading to the flooded regions from Pennsylvania, Ohio, the Delmarva area, Wisconsin, Minnesota, North Dakota, Texas, Kansas, Florida, etc.
Tale after tale is told on various facebook pages, like Ag Community Relief, of the generosity brought to the region.
“It’s a tough deal,” said Thiele, recounting stories of families that have lost everything on farms and in towns. This is a total farm economy here, and the farm economy for the last four years running has already been bad. We are already in a long-term downcycle. There hasn’t been a lot to be optimistic about. What we need is for the trade agreements and other underlying problems to be finalized. For long term recovery, our markets have to improve so farm families have a chance.”
“For those who are against our cattle and dairy operations, take a look at our faces. You’ll see very tired faces. These farmers and ranchers are caring and doing absolutely everything they know to do, even risking their own lives on a tractor to try to get cows out of a field before a flood takes them away. All we want as farmers and ranchers is to have a real chance.”
Yes, Mother Nature will do what she will do, but it is agriculture policy that needs attention and it is the generosity of fellow farmers and ranchers across the country that helps those in the thick of a really tough deal.
No matter what Mother Nature dishes out, Rural America responds with a can-do spirit. Farmers and ranchers nationwide are stepping in to help those affected by the storms and floods in the Midwest with prayers, hay, feed, supplies and financial donations. The appreciation is great.
Nebraska Farm Bureau Foundation’s Disaster Relief, PO Box 80299, Lincoln, NE 68501-0299 or visit nefb.org/disaster. Also, the Farm Bureau’s Ag Disaster Exchange matches hay/supply donations with need https://www.nefb.org/ag-disaster-exchange.
Hay moves along the Ohio Turnpike this week, Nebraska bound, from Delaware, Maryland and Virginia. In fact Maryland’s Oakdale FFA Chapter (along with donations at the recent Frederick County 4-H meeting) has an “Operation Nebraska” fund-raising effort going full-throttle raising funds for transporting hay to Nebraska. That effort began when Becky Long Chaney of Nebraska and Kathy LaScala of Kansas were contacted by Kathy Stowers and given one task: find a ride for 110 round bales of hay donated from Middletown, Maryland. Similar hay convoys have transported loads of hay and supplies from central and western Pennsylvania, Ohio, Michigan, Kentucky, and Florida as well as from Wisconsin, Minnesota, Oregon, Idaho, the Dakotas, Kansas, Oklahoma and Texas. Those bringing hay are encouraged to have a contact in the region, to be self-sufficient, and to know they are appreciated. Hygiene and cleaning items, gloves, masks, tools, animal health supplies are also appreciated. Facebook photo provided
Through futuristic lens: Is it time to end USDA control of dairy promotion?
No matter what innovations they come up with in the future, real dairy milk will always be the completely natural, minimally-processed, clean-label product with the superior combination of complete protein, healthy fat, and long list of essential natural nutrients, not additives. Treating real dairy milk like a cheap commodity must end. Innovative marketing may be more important in today’s times than innovative manufacturing processes. Government rules make it difficult to truly promote real dairy milk. It’s time to re-think the government oversight of the mandatorily farmer-funded milk promotion business so that truly competitive promotion can happen. (Istock photo).
By Sherry Bunting, Farmshine, March 29, 2019
“It’s not that the bad guy came and took it (fluid milk sales), it’s that us, the dairy industry collectively, did not keep growing and innovating and doing what we should do. Instead of getting in a lather about plant-based food companies, let’s do what we are supposed to be doing as an industry. Let’s do marketing. Let’s do innovation. Let’s have dairy-based protein in 3-D printers and whatever comes next. That’s where we need to be.”
These were the words of Tom Gallagher, CEO of Dairy Management Inc. (DMI) to his dairy checkoff board recently as shared here, and in the March 20, 2019 edition of Farmshine from a video of his comments.
A glimpse into what that might mean was revealed at the IDFA (International Dairy Foods Association) convention in January, where DMI’s vice president of global innovation partnerships, Paul Ziemnisky told attendees that 95% of households have milk and buy milk, but that these households engage in “fewer consumption occasions”, according to a recent convention report in Dairy Foods magazine.
To increase ‘consumption occasions’, DMI has been investing checkoff dollars toward innovations in “milk-based” beverage growth, he said.
Through its Innovation Center for U.S. Dairy, DMI has invested checkoff dollars in these types of “pre-competitive” innovations in the past — an example being fairlife.
It is interesting that in both Gallagher’s comments to the DMI board and in the presentation by DMI’s Ziemnisky’s to processors, the term dairy-based or milk-based is used.
As we’ve reported previously, the direction of dairy innovation over the past 10 to 20 years has not been lacking in its drive to pull out the components of milk for inclusion in a variety of products — taking milk apart and putting it back together again — in a way that is new and different or in a way that presents milk and dairy as a new product.
Expect to see this type of innovation increase via these investments of dairy checkoff dollars into developing combination beverages that include pieces of milk in entirely new beverages.
This is what is meant by innovation.
At the IDFA convention, DMI gave processors a glimpse into some of the innovations they are working on to address four consumer targets that DMI has identified:
1) A milk- and nut-based combination beverage,
2) A milk with lavender and melatonin to promote sleep,
3) A yo-fir product (kefir plus yogurt) beverage,
4) A milk beverage that provides just a hint of flavor,
5) More concepts in high-protein milk-based beverages,
6) A ‘plosh’ blend of tea, coffee and milk, and
7) An all-natural concept of milk blended with fruit.
As the overall beverage sector is exploding with new beverages of all kinds every year — some winners and some losers — DMI is looking to do more in the re-creation of dairy in the beverage space with new combination beverages that include milk, or components of milk, but are not identified as milk. These beverages will compete with non-dairy beverages, but in a sense, this track would further compress real dairy milk into its age-old commodity posture. Of course, those who are engaged in promotion of real dairy milk can position it as the wholly natural choice in a beverage sector of further processed combinations and concoctions.
Something to watch and be aware of is that PepsiCo – a company the dairy checkoff organizations are forming stronger bonds with — is on the frontier of turning drink dispensing machines into a hybrid of 3-D printing and multi-source create-your-own beverage dispensers. On the CNBC’s early-morning Squawk Box business news a few months ago, this concept was discussed showing a prototype where consumers can create their own unique beverage by pushing buttons for a little of this and a little of that. Millennials look for unique and “personalized” foods and beverages — we are told. And we see this trend in the “craft beer” category, for example.
A caveat to follow in this trend is the importance of labeling by USDA and FDA as the new gene-edited cell-cultured animal-based proteins and genetically-altered vat-grown yeast-produced dairy-based proteins move from the lab to the market in the next 12 to 24 months via partnerships between the billionaire-funded food technology startup companies and the world’s largest agricultural supply-chain companies.
While everyone is watching what happens in the cell-cultured fake-meat category and the partnerships there with Cargill, most of us do not realize how close the dairy versions are to scaling-for-market — since Perfect Day company partnered last fall with ADM (Archer Daniels Midland). That partnership is predicated on ADM providing the facilities and mechanisms to ramp up the production of ‘cow-less’ so-called dairy proteins, and USDA research labs do the gene-altering to provide the seed-source of yeast for the process.
As these other proteins are introduced into the food supply, it is yet unclear how – exactly – they will be identified and differentiated in the marketplace. While the dairy and livestock sectors pushed hard to soften the distinctions of proteins in food from animals that have been fed GMO crops, the downside of USDA’s new Bio-Engineered (BE) food labels is that these fake proteins that are on the horizon may not be labeled or differentiated when they are a part of the final food or beverage product.
On the bio-engineering side of animal-based cell-cultured fake-meat protein production (cell-blobs grown in bioreactors), USDA and FDA are still working out the details of their combined food safety requirements.
But on the bio-engineering side of the yeast that have been genetically-altered to possess bovine DNA snips to exude ‘milk’ protein and perhaps other components (grown to exude dairy protein and components in fermentation vats), there is far less discussion of inspection or oversight.
As for the labeling of both types of bio-engineered protein, there is little discussion of how foods containing them will be labeled.
Just three months ago, U.S. Agriculture Secretary Sonny Perdue announced the new National Bio-Engineered Food Disclosure Standard that will be implemented in January of 2020. It is the result of the July 2016 law passed by Congress that directed USDA to establish one national mandatory standard for disclosing foods that are – or may be – bio-engineered.
USDA Agricultural Marketing Service (AMS) has developed the List of Bio-Engineered Foods to identify the crops – and foods – that are available in a bio-engineered form throughout the world and for which regulated entities must maintain records that inform whether or not they must make this bio-engineered food disclosure.
Some are voluntarily complying already, as I have seen this BE statement in very small print on small containers of some Kraft ‘cheese’ spreads.
The bottom line in this mandatory BE labeling requirement is that it only pertains to the main ingredient of the further-processed food or beverage and only if there is “detectable” genetically-altered material in that food. This means that the BE labeling may not apply to fake meat or fake dairy. In the case of the fake meat, the bio-engineering is the editing of DNA to grow muscle (boneless beef for example). In the case of fake dairy, the bio-engineering is yeast altered to include specific bovine DNA, but the resulting cow-less ‘dairy’ protein would have no detectable difference, its creators say.
All animal protein checkoff programs have a tough road ahead. If farmers and ranchers continue to fund promotion of the foods and beverages that come from dairy and livestock farms, these fake iterations of the real thing will benefit unless promotion can be targeted to the real thing and consumers see the difference on a label in order to make a choice for the real thing.
This all sounds so futuristic and like science-fiction, but in foods today, this is where we are headed and our checkoff programs should be aware and should be able to stand up for the real thing. They should be allowed to lobby regulators for fair treatment and distinct labeling because the government requires farmers to pay these checkoff deductions to promote their products. Thus, if the government does not provide a clear path to distinguish fake from real, then the fairness of requiring a checkoff should no longer be considered valid.
As for dairy farmer checkoff funds, specifically, the future is here and DMI is already moving down that road to innovate dairy-based or milk-based products that dilute the meaning of dairy and milk in the marketplace – in effect paving the way to new innovations and products in which real dairy-farm-produced milk components can be replaced by fake-dairy components from genetically-altered yeast grown in ADM fermentation vats.
Perhaps checkoff funding should be directed in these difficult and changing times toward true promotion of what is real. We see that starting to happen with the “love what’s real” campaign, launched by the Milk Processors Promotion and Education Program (MilkPEP) and supported by DMI’s Undeniably Dairy social media campaign.
More than ever, the future of our dairy farms will rely upon promotion of what is REAL – moreso than using dairy farmer checkoff funds to find ways to put pieces of milk into other products or into 3-D Printers. Profile those components. Provide the benefits of real dairy components for the manufacturers that are moving into 3-D printing of personalized foods and beverages, but keep the powder dry for a full-out real dairy campaign. If USDA does not allow real dairy farmer checkoff funds to talk about why they are so much better than the fake stuff that ishere and that is coming… then it is time to get the government out of the promotion business and return these funds to dairy farmers so they can voluntarily use them to promote their real products, their true dairy brands.
In a future of murky food sources – farmers must be able to stand up for what they produce. They must be able to promote Real Milk that is unfooled-around-with, that is from the cow they have fed and cared for.
With the food revolution here, dairy promotion will need a marketing revolution to welcome people back to what’s Real — especially as more household decisions are made by people growing up without knowing what Real Whole Milk tastes like.There’s an idea. Real Whole Milk is tastier, healthier, with a truly cleaner label than about anything else that is here or that is coming to compete with it in the beverage sector.
Ditto for Real Yogurt and Real Cheese, etc. in the food sector. Undeniably Dairy – the dairy checkoff program – has a nice ring to it. Love what’s Real has a great message to it. But if dairy farmers can’t use their mandatory funds to take the fake stuff head-on, then it’s time to stop taking mandatory checkoffs and allow farmers to use their money to promote their product – no holds barred.
When the competition is funded by Silicon Valley billionaires, has the backing of major food and agriculture supply-chain companies, is sourcing genetically-altered material from USDA, and does not have government requiring distinctive labeling – then dairy farmers need a level playing field to use their hard earned $350 million plus to put a stake in the ground to promote why Real is better. Checkoff staff often say the competition is doing brand advertising and “we can’t.”
That being the case, perhaps give the money back to the farmers so they can form voluntary promotion groups or voluntarily give the funds to the brand that receives their milk to get in the game of head-to-head advertising instead of, in essence, funding a path to their own substitution and demise.
‘Let’s have dairy-based protein in 3-D printers and whatever comes next.’
Schools represent more consumer touch-points for milk than all other sectors, combined
By Sherry Bunting, Farmshine, Friday, March 22, 2019
CHICAGO, Ill. — The fluid milk category is receiving much attention after a decade of rapid declines in sales. What does the CEO of the national dairy checkoff organization DMI have to say on the topic?
For starters, he says the dairy industry should stop blaming the alternative beverages and start looking at its own failures.
In his CEO’s Report, delivered at the February DMI board meeting, DMI CEO Tom Gallagher addressed the fluid milk question. While no press release or public statement or copy of the CEO’s Report was provided to Farmshine, a video was posted to the private Dairy Checkoff facebook page and was subsequently provided to Farmshine by a dairy farmer participant.
Since Gallagher states while giving his “CEO’s Report” that this information is ‘public’ and that “we want you to take pictures of it and share it, do what you want with it, it’s yours.” So we are sharing with Farmshine readers what was shared with us by dairy farmers what was shared with dairy farmers via the closed facebook group.
Gallagher began his report talking about farmer engagement.
“The power of the industry is within the industry, it’s the farmer,” he said. “We can commit to activating the dairy farmer at the local and national levels, then we can have a big voice, especially, on what it is that your checkoff really does.”
He talked about the changing world of consumer influence, saying that, “When you think about the things we need to do, more and more they are moving away from the things we are familiar with.”
From there, he referenced a presenter for the following day who would be talking about the future, about 3-D printing of food.
“Well, it’s not the future because you can go on Amazon today, and for $2000, buy a 3-D printer that will print dessert for you,” said Gallagher. “We think, why would people eat that? They don’t like processed foods. But the people who make those and the food production people — and hopefully dairy protein will be in that, not plant protein — they don’t need the 90% of people consuming your product. They just need 5 or 10 or 4% to have a very successful business. If that’s what people are going to be doing, we need to be there.”
Gallagher announced that DMI will be buying a 3-D printer, a few of them. “We’ll buy one, and we’re going to figure it out and we’ll figure out how to approach these 3-D printing companies with dairy-based proteins in foods to be used in them,” he said. “We can’t afford to be nickeled and dimed with 4% of consumers here and 5% there.”
He went on to observe that just 4% of consumers identify as vegan and that vegetarians are also a small number. “What is really driving plant-based foods and beverages is not predominantly the vegan movement, it’s because these companies are investing hundreds of millions of dollars and are getting really good at taste, are phenomenal at marketing and great at innovation.”
He referenced diets that promote being vegan or vegetarian before 6:00 and other consumer trends.
“I think our goal is it is not either-or, it can be both… We have to be honest with ourselves, there will be plant-based beverages out there, and people will buy them, and they will gain share, not because people are vegan or concerned about sustainability… it’s because the food and beverage companies are doing a great job at what they do,” Gallagher said.
“If we do the same job in the dairy industry, we will be just fine. But if we sit back like we did with fluid milk, we will be where we are with fluid milk,” he added.
Referencing a report in the 1980s before the checkoff was authorized by Congress, Gallagher said: “That report laid out everything that needed to be done for fluid milk, and that same report would be valid today because none of it was done — not until fairlife and a few other things.”
“It’s not that the bad guy came and took it (fluid milk sales), it’s that us, the dairy industry collectively, did not keep growing and innovating and doing what we should do,” said Gallagher from a marketing, not policy, standpoint. “Instead of getting in a lather about plant-based food companies, let’s do what we are supposed to be doing as an industry.
“Let’s do marketing. Let’s do innovation. Let’s have dairy-based protein in 3-D printers and whatever comes next. That’s were we need to be,” said Gallagher. When it comes to policy, nutritional values and sustainability discussions, that’s another discussion we need to enter into.”
In the breakdown on sales, he said foodservice milk is up slightly even though retail and other sectors are down. The data was by servings, and he explained how sales figures are pieced together and how program evaluations fit into those.
He also talked about a meeting DMI had with the top persons from the five top coops for packaged fluid milk salesn — DFA, Select, Prairie Farms, Darigold and Maryland-Virginia — along with Jim Mulhern of NMPF, Tom Vilsack of USDEC, Rick Naczi of ADANE, Marilyn Hershey, president of DMI, along with a former CEO of fairlife with some insights.
“We came out of that meeting as positive about fluid milk as ever on how the industry can work together to change the trajectory,” said Gallagher, explaining that they looked at how much of fluid consumption is really pushed down into Class II, and to see if getting and including that number, what that would do to the per-capita fluid milk consumption numbers.
“The group focused on kids. Kids is the deal — at 6 billion containers a year, when everything else is 5.3 billion,” said Gallagher. “So while schools only represent 7.7% of consumption, it represents more touch-points with consumers than everything else combined. So, they, on their own, quickly came to the conclusion that we have got to deal with the kids for a variety of reasons — sales and trust. And they asked DMI to put together a portfolio of products for kids inside of schools and outside of schools. What are the niches that need to be filled? What’s the right packaging? What needs to be in the bottle? And we can do that,” he said.
Depending on the results of the next meeting, the circle could be expanded. And regulatory, legislative and standards of identity issues were brought up that DMI can’t be involved in, but NMPF can.
Author’s note:Meanwhile, all of those kids in school, those 6 billion touch-points for milk every year that surpass all other touch-points for milk, combined, are forced to consume (or discard) fat-free or 1% milk. The simple answer would be to give them whole milk that tastes good so they know what milk is vs. trying to re-invent the wheel. As an industry, we can’t know what the per-capita fluid milk consumption figures would look like today if the 60 billion touch-points over the past 10 years had been permitted by the government to consume whole milk. Before reinventing some pre-competitive proprietary wheel, shouldn’t those touch-points (schoolkids) have an opportunity to try real whole milk?
Ag Moos 