By Sherry Bunting, Farmshine, April 19, 2019
GORDONVILLE, Pa. — “You are hearing the negatives, not the positives,” said Marilyn Hershey about the dairy checkoff during a meeting requested by Lancaster County dairy farmers hosted here in Gordonville on Friday, April 12.
Hershey has a dairy farm with her husband Duane in neighboring Chester County, and she serves as the national chairperson of the Dairy Management Inc. (DMI) board.
Approximately 12 of the expected 30 farmers attended the meeting with a range of topics on their minds, in particular fluid milk sales and whole milk promotion.
Hershey got involved in dairy promotion eight years ago, serving first on the National Dairy Board, then becoming vice chair of DMI, the board that combines various boards, before becoming chairperson two years ago. National Dairy Board has term limits, whereas the DMI board does not.
Accompanying Hershey for the discussion was Harold Shaulis of Somerset County, who served 25 years on state, regional and national checkoff boards. Having sold his cows, he is no longer a board member, but helps with promotion.
Shaulis said the bottom line in dairy promotion is to sell more milk. He said total per-capita dairy consumption has grown since the 1980s, even though fluid milk sales have declined (Fig. 1). He also talked about trade missions to China and Southeast Asia.
“We are in a global market. One out of six loads of milk a day is exported, and we want to see that grow,” he said.
In addition to exports, Hershey said consumers are eating more dairy products, overall. “The National Dairy Council has funded 20 years of research on butter to get it back in the mainstream. We got butter into McDonalds in place of margarine, and 80% of McDonalds’ sales have a dairy ingredient in them,” she explained as an example of DMI’s partnership strategy.
By email, after the meeting, Hershey furnished the previously requested list of National Dairy Council research we will explore for a future edition.
However, a perusal of the science summaries section of National Dairy Council’s own website, where a few summaries are available, each download is prefaced with these words: “Low-fat and fat-free dairy foods are part of the Dietary Guidelines for Americans (DGA) and American Heart Association (AHA) dietary recommendations. You can download our full report, which shows further support for consuming low-fat or fat-free dairy foods as recommended in the 2015 DGA.”
The website also talks about “nourishing communities,” about farm animal care and sustainability measures (FARM program) adopted and funded by checkoff dollars that tie in with the low-fat and fat-free dietary theme.
Undeniably Dairy replaces Real Seal
Cross-referenced to the National Dairy Council website is the Undeniably Dairy campaign. Hershey said this promotes positive messages to targeted audiences with school curriculum and through social media.
At this website, the “nourishing communities” theme continues as well as the reinforcement of low-fat and fat-free dairy.
Hershey provided a handout on Undeniably Dairy and said: “We are targeting the ‘conflicted health seeker’ with four messages: Responsibly produced, nutrient rich, locally driven, real enjoyment.”
More interesting is where DMI wants to take the campaign.
“We want Undeniably Dairy to replace the Real Seal. That is the goal,” said Hershey. “We are combining MilkPEP’s ‘Love What’s Real’ campaign with our Undeniably Dairy campaign.”
The Real Seal was previously owned by UDIA / DMI, but it is now the property of National Milk Producers Federation (NMPF). The Real Seal can only be used on milk and dairy products that contain real dairy ingredients, no imitation dairy ingredients and are made with milk produced and processed in the USA.
This posed a problem for DMI, since importers must pay a small checkoff fee for dairy promotion, so the dairy checkoff stopped promoting the Real Seal and came up with Undeniably Dairy two years ago.
Hershey fielded questions about the requirements for using the Undeniably Dairy Seal. How might those requirements differ from the Real Seal? She did not have the specifics and promised to get back with those details.
In the schools
“We don’t just have a foot in the schools, we are IN the schools,” said Hershey. “Companies would kill to have what we have in the schools.”
The Northeast program is strong because there are seven football teams here so the program can affect a large number of kids in the Northeast, according to Hershey.
Asked what is on the breakfast carts, she said: “Yogurt, cheese, milk, fruits and vegetables, and some have smoothie machines.”
She said the Grab N Go Breakfast Carts have ice packs to keep the milk cold. She also stated that every dime ADA Northeast sends in to GENYOUth is returned to the Northeast region to fund FUTP60 and breakfast carts as well as other foodservice equipment grants to schools. (See ADA Northeast 2017 Annual Report here)
Hershey confirmed that the GENYOUth Gala raises more money than it spends by getting funds from other donors to buy more carts. She explained, as previously reported in Farmshine, that PepsiCo gave $1 million to translate FUTP60 into Spanish and pay for more breakfast carts. She said PepsiCo made a large 2018 commitment to the program, and that’s why PepsiCo recognized with the Vanguard Award at the 2018 Gala.
“We buy the carts, and we have multi-year contracts with the schools to keep milk on the carts,” said Hershey.
Acknowledging that the milk provided is fat-free or 1%, she stressed that, “As independent dairy producers, we can advocate for whole milk, but DMI, FUTP60, and GENYOUth cannot influence policy,” she explained.
“You have to go to your co-ops and Farm Bureau and G.T. Thompson to get that done. We can’t do it,” said Shaulis.
“What we can do is put out our research and promote research,” said Hershey.
Shalis said the FUTP60 breakfast carts “absolutely sell more milk.”
He reported that 95,000 more children participated in school breakfast in 2018 compared with 2017. “That’s 95,000 more servings of milk since they have to take a milk.”
“But do they like it?” asked one farmer.
Hershey quickly replied: “It doesn’t matter if it’s 3%, 1%, 2% or 0%, they are getting the same nutrition. Even though they are not getting the fat content, they are getting the nutrients.”
A discussion of fat-soluble nutrients and bioavailability of nutrients ensued.
When asked if DMI, yes or no, believes 1% and fat-free milk are equal to whole milk, Hershey said: “We have no control over what we serve or promote in the schools. With that carton of 1% milk, we want children to know they are getting the nutrition, we can’t address the fat.”
When asked what DMI can do about 20-plus years of having the low-fat diet-heart hypothesis “forced on us,” Hershey’s reply was that, “It took 20 years to get here and it will take a while to turn it around.”
She informed the group that the American Heart Association has already written a letter to Congress signed by 18 health organizations protesting the House Bill 832: Whole Milk for Healthy Kids Act.
“They are against the bill, so there is a battle in front of us,” Hershey said.
On the positive side, Hershey said farmers can thank Dr. Greg Miller, global chief science officer for the National Dairy Council, for his use of the research on full-fat dairy. She also said dairy farmers can thank the dairy scientists in each partnering company’s kitchen as DMI develops new products for Pizza Hut, Taco Bell, Domino’s and McDonalds.
Beyond the fat
“Lots of things with school milk need changing, not just the fat,” said Hershey as she dove into the innovations side of DMI’s strategy.
“I appreciate that the fat content is your focus, but it has to be the right temperature, delivered correctly and packaged correctly,” she said. “We are working on this with processors.”
She said that giving high school teens the same packaging as kindergarteners doesn’t fly. She cited research showing that when schools switched from paper cartons to plastic bottles, milk sales grew by double-digits in the first year, and waste was down by 20% in those schools.
“Kids want to drink their milk from a bottle because that’s how they drink everything else,” said Hershey, noting that Rick Naczi, executive director of ADA Northeast, pointed this out at a fluid milk meeting DMI had in Chicago in February.
“School milk got a lot of discussion there,” Hershey reported. “But, let’s not get lost in this whole milk point. There is a huge price difference (between whole milk and 1% or fat-free), and school contracts are lost by one-quarter of a penny per carton.”
Some of the farmers in attendance said that didn’t matter unless other beverages can compete for those contracts. The bottom line would be whole milk going into the schools.
Time was also spent talking about the trend toward smaller containers and ultra-high temperature (UHT) pasteurization. “All the milk in Europe is UHT, and it tastes good,” said Shaulis.
Some of the farmers in the room disagreed, sharing their concerns that UHT leaves a less valuable product nutritionally and in flavor. To which, Hershey and Shaulis said the entire food industry is going that way, and there’s nothing they can do about that.
“What we have to try to do (in promotion) is stand by the value milk has and promote what we are able to promote,” said Hershey.
She shared figures showing that overall fluid milk sales represent 18% of total milk production: “79% of consumers are not eating meals as a family. Everything is grab and go. That’s where we need to be,” said Hershey. “We have to meet consumers where they are with our innovation and packaging.”
Citing fairlife, she explained how “that product came through our fluid milk committee, and now others are following. Darigold has a new high protein ‘fitness’ drink. DFA has a couple things coming out under the Live Real Farms label. Kroger and Shamrock are coming out with beverages – all this year. These products have a lot of milk in them,” she said.
Farmers learned that these new products are not Class I products. They are largely Class II.
“We partner on these products,” said Hershey. “We give money for research. They do the product research. We only contribute to the research to try and get the innovation out there in order to survive.”
“We gave up on selling milk. ‘Got Milk’ did nothing,” Shaulis added. “Generic milk advertising doesn’t work.”
Farmers wanted more statistics to back up this claim, and they referenced the overwhelming reaction among consumers to the 97 Milk Baleboards and campaign done voluntarily at a grassroots level, starting in Lebanon County, Pennsylvania with signs and baleboards now in five states and spreading nationwide and internationally through the website and social media.
Hershey did share the news that retail data show whole milk sales grew more in the first quarter of 2019 than the already higher whole milk sales in 2018.
She later sent an email stating that in the Northeast, retail sales data show 40% of fluid milk sales are coming from whole milk sales. She also reported that, nationally, whole milk sales as a percentage of total fluid milk sales rose from 29.7% in 2014 to 39.3% currently.
As one farmer noted, “DMI has done a good job promoting cheese, what we are asking for is more focus on fluid whole milk than we are seeing now.”
Farmers were concerned that if they continue to be forced to pay into a checkoff program that represents their market less and less, what does the future hold for them?
Hershey had explained that the national checkoff boards are represented geographically by milk volume.
Some wondered if making the checkoff voluntary would allow them to put money into promoting local whole milk, and to take on the imitations head-to-head without the restrictive oversight of USDA.
“It’s all or nothing. That’s how the whole world of checkoff programs work,” said Shaulis. “These farmers on the board look at every penny spent, and they look at what is best for the industry while regions look at what is best for their region.”
To be continued.