From Probiotic Milk to High Protein Cheese: The Dairy Industry Is Expanding Its Product Offerings

As consumers continue to demand healthy snacks and nutritional food offerings, the dairy industry sees potential growth in the expansion of their category. In order to fit into consumer trends and preferences, major dairy companies have been offering new and innovative dairy-based products such as probiotic milk, high protein cheese, protein shakes and even healthy snacks. Last week, the Dairy Farmers of America (DFA) held their annual meeting in Kansas City in which they discussed growing trends in dairy innovation and how the dairy industry can flourish in the health-focused consumer market.

At the meeting, the DFA reported their net sales for 2017 which were up by nine percent from the previous year, reaching a total value of $14.7 billion. The organization credited this revenue jump to the increased price of milk in 2017 which averaged at $17.62 per cwt (per 100 lb), up from $16.30 per cwt in 2016.

The DFA also talked about their recent joint venture with Ireland-based company Glanbia plc. The two organizations have invested in Southwest Cheese Co. LLC, a Clovis, New Mexico-based cheese and whey product producer. In addition, the two companies are in the process of building a Michigan-based cheese and whey production plant which they plan to open in 2020.

Glanbia also discussed their 2017 profits at the meeting. The 14,000-member association had a 2017 revenue of €2.38 billion which is up seven percent from 2016. Their Glanbia Performance Nutrition sector had a 2017 revenue of €1.12 billion which is up 11 percent from 2016. Glanbia Nutritionals also experienced some revenue growth last year bringing in €1.27 billion, a 3.4 percent increase from the prior year.

According to Glanbia, their cooperative organization has found success in the dairy industry through strategic partnerships such as the one they have with Dairy Farmers of America. In 2017 the Ireland-based company had acquired Newport Beach, California-based company Grass Advantage LLC, a producer of plant-based nutrition brands. Glanbia had also acquired Body & Fit that year, which is a direct-to-consumer dairy-based healthy snack brand based in Heerenven, Netherlands.

“We will be investing significantly behind bringing new people into our organization, building out our technology platform, really building both from the ingredient side and from the branded side the capability to engage with consumers and bring it to a whole new level,” Siobhán Talbot, Group Managing Director at Glanbia plc told Food Business News.

Both Glanbia and the DFA agreed that the dairy industry needs to invest in product expansion if they want to bring in more profits from health-focused consumers. The DFA recently introduced probiotic milk products under their Kemps brand, which come in 2 percent and fat-free varieties in order to appeal to consumer trends and add more nutritional value to their products. Whole milk string cheese was also introduced by the organization under their Borden brand in response to the growing consumer demand for whole milk products.

The DFA’s President and CEO, Rick Smith, also mentioned that the organization might be “rediscovering cottage cheese” in 2018 as well. Glanbia’s recent acquisitions also allow the organization to have a diverse portfolio of product offerings such as Body & Fit’s whey protien balls.

“There is a massive trend for health and wellness,” Talbot said. “There is a massive trend for convenience. Technology has transformed how consumers engage with brands, how consumers engage with nutrition and how consumers engage with food. Last but not least, I think a trend that has become more dialed up in recent times is this whole area of clean labeling.”