Dairy, Dairy So Contrary....how will the future go?

Written by Blake Anderson, President & CEO- ADPI
January 21, 2020

A year ago, at IDFA’s Dairy Forum, one of the keynote speakers, Ken Schmidt, a former Director of Communications at Harley-Davidson Motor Company, rode into the grand ballroom and onto the stage atop a revved-up Harley-Davidson motorcycle. He then commenced to mesmerize the audience of dairy processors and related stakeholders with a non-conventional message focused on “speaking truth to power” and thinking outside the box. You should read his book for the juicy bits, but at the end of his remarks he brought it all together by challenging our “dairy industry” with three simple questions. These questions, to me at least, have been like a catchy song you hear and cannot get out of your head. Now here we are a year later, and they remain relevant and most apropos to our situation.

ADPI®, the American Dairy Products Institute®, is in its 95th year of continuous operation of, for and by its members. The “Institute” is proof positive that enabling a collaborative environment whereby people and organizations can work together for mutual benefits can thrive, innovate, and improve products, processes, and consumers lives.

ADPI, the nation’s leading trade organization focused on dairy ingredients and related products, is entering its ninety fifth year of continuous operation since its founding in 1925. ADPI, an organization of, for and by its members, originally began as the American Dry Milk Institute (ADMI), organized by 18 manufacturers of dry milk on June 03, 1925, originally as a “temporary association,” and based in Chicago, IL USA.  

At the recent ADPI/CME Group hosted Dairy Purchasing & Risk Management Seminar a common theme was apparent. 

The attendees were eager to learn, and hungry for new information so as to better enable them to be productive in doing their jobs. 

What was interesting was that the attendees came from all aspects of our industry and not just the finance and or procurement departments of their companies as you might have suspected. During the various “networking” opportunities it was not uncommon to hear people say things like, this is a great source of training, or this is really educational. Another often heard phrase was this seminar helps me develop a new understanding or a new skill set. 

•  T for training, E for education, D for development = “T-E-D.” 
   

Written by: Blake Anderson, President & CEO, American Dairy Products Institute

Most things are cyclical....., the four seasons, sunrise & sunset, breakfast, lunch, dinner, etc.  Fundamentally, so was the case of “Supply & Demand.”  We all were taught in basic economic courses - the higher the demand, the higher prices can go.  Then, as supply rises and eventually surpasses demand, prices are depressed, which in turn dampens supply.  Voila, and the cycle repeats……………………

Written by: Blake Anderson, President & CEO, American Dairy Products Institute
 

“Almonds don’t lactate,” as was famously pointed out by former FDA Commissioner Scott Gottlieb in July of 2018, but yet when “processed” here in the United States the product is labeled and marketed as “Almond Milk.” However, the same product in Canada, is marketed as a “Beverage.” Canada has the same standard of identity labeling rules that exist in the U.S. for “milk”, so why the difference in the name, perhaps because they just choose to enforce them.

The American Dairy Products Institute (ADPI) and the members of the Dairy Protein Messaging Initiative (DPMI) are pleased to announce the launch of a new website (designed to communicate the benefits and positive attributes of proteins from milk, with a focus on protein ingredients: www.TheStrongInside.com. This proactive and impactful platform will serve as an informational tool to guide targeted consumers (“Protein Seekers”, millennials and women) with regards to their protein choices.

The Strong Inside message is the foundation of the Dairy Protein Messaging Initiative. Backed by science, but designed to appeal to consumers’ emotions, it emphasizes the unique value of proteins from milk in an engaging and positive way. 68% of American consumers want to consume more protein and many are turning to dairy alternatives. Through research conducted over several months, the DPMI developed and tested messages, and selected those which will effectively influence consumer choices. For a preview of The Strong Inside message - click here  

New Competencies Added to Meet Diverse, Growing Membership Needs

The American Dairy Products Institute (ADPI) is proud to welcome two additional industry professionals to the ADPI Center of Excellence. Joining this group for 2019-2020 are Dr. David Clark and Dean Tjornehoj, two highly experienced dairy industry professionals, whose experience and skills complement the existing panel of experts comprising our Center of Excellence resources.

The ADPI Center of Excellence is a network of twelve experienced dairy industry professionals with the expertise to answer questions and assist ADPI members on a wide range of topics. The group is a key part of ADPI’s ongoing activities as the “go-to” authority on dairy ingredients. The Center provides ADPI members with an easy and economical way to gain access to industry experts capable of addressing dairy-related questions or concerns they might have.

ADPI Center of Excellence professionals are available to help ADPI members, providing free consultations (up to 2 hours per topic) on a totally confidential basis. They also share their expertise throughout the year by participating in ADPI’s events, i.e. seminars, conferences, symposia, webinars and educational programs. 

by Geoffrey Smithers, ADPI Center of Excellence

The global population is ageing at a dramatic rate.  Figures from the United Nations and other agencies indicate that the proportion of the world’s population aged over 65 years is set to double by 2050 from about 8% of the population now to ≈16% in only the next 30 years.  Such a dramatic ageing of the population places increased pressure on an already overloaded healthcare system.  Indeed, healthcare spend in the USA currently represents about 17% of GDP but the trendline suggests that, in the absence of reform, healthcare spend in the USA will exceed 20% of GDP (≈ $4 trillion) in only the next few years!

“The ageing of populations is poised to become the next global public health challenge. During the next 5 years, for the first time in history, people aged 65 years and older in the world will outnumber children aged younger than 5 years.” – Suzman et al. (2015).

If we’re to avoid a potential collapse of the current healthcare system, that is primarily based on treating disease, then such a “treatment approach” must be balanced with a “preventative approach”.  In other words, the focus needs to shift to preventing illness rather than treating disease.  Foods, and in particular dairy foods, will play a critical role in this rebalancing of the healthcare system.

Yet another market is being shaken up by the African swine fever raging in Asia: Surprisingly, it’s U.S. dairy farmers.

Pigs eat components of whey, which is a cheese byproduct. Because China’s herd is shrinking due to swine fever, demand is plummeting. In addition, due to the Asian nation’s trade war with the U.S., it has started sourcing the whey it does need from other countries.

Pricing has already been impacted. Whey powder prices have dropped as much as 20% this year, while a whey component known as permeate has lost half of its value since February. This comes as dairy farmers have battled years of unprofitable milk prices as supplies outpace demand.

“There’s a double hit,” said Blake Anderson, president and chief executive officer of the American Dairy Products Institute. “There’s the swine flu situation and then there’s the ability to even get product into China, for example, due to various trade barriers or tariffs."

U.S. dairy farmers could see a reduction of 50 cents per hundredweight or more off their milk checks due to the dynamic this year, said Mary Ledman, global strategist for dairy at Rabobank.

Recent estimates suggest that African Swine Fever (ASF) has reduced the China sow population by as much as 30-50% and is spreading rapidly in other major pig production regions such as Vietnam.  This outbreak will cause global pork supply shortages and soaring pork prices. This puts a premium on maximizing the productivity of surviving pigs in all regions to ease the impact of this terrible disease.  

And according to Dr. Kevin Halpin, Ph.D., Chair of the American Dairy Products Institute’s Permeate Task Force and Vice President of Sales and Marketing for International Ingredient Corporation, increasing permeate inclusion rates in swine nursery feeds globally can be part of the solution.  

At this year’s ADPI Annual meeting in Chicago earlier this month, Halpin reported on two ADPI-funded research projects conducted in large commercial pig production facilities. The studies reaffirmed that a total pig intake of approximately 2.5 pounds of permeate is optimal for overall pig productivity and health.  Key conclusions from the two projects presented were as follows.

The American Dairy Products Institute (ADPI) is announcing a “pan-industry” campaign to communicate positive and factual information relative to dairy ingredients and specifically dairy proteins.  

ADPI’s Board of Directors recognized a void in the industry’s messaging and communication of dairy protein ingredients in foods and beverages. It commissioned a Task Force comprised of members who volunteered to evaluate the opportunity and recommend an action plan. Padilla and its FoodMinds division were selected to work with the ADPI Task Force to execute a fact-based, integrated strategic digital communications program, known as the Dairy Protein Messaging Initiative or “DPMI”.

The American Dairy Products Institute (ADPI) is proud to announce that they have recently released a new official ADPI standard for Milk Minerals. As the world's "go-to" authority on dairy ingredients, ADPI is committed to the development of dairy ingredient standards and specifications. 

The American Dairy Products Institute has announced the appointment of Blake Anderson, as their new chief executive officer. Anderson joins the ADPI after a period of strong growth and significant progress in advancing the strategic goals of the association.  “Blake brings a wealth of leadership, skill, and character into our organization and the ADPI Board and I are confident that he is the right person to build on this momentum,” says Jerry O’Dea, president of ADPI’s board of directors

The sugar lactose is the primary carbohydrate source for neonatal mammals.  Mother’s milk is rich in lactose.  Newborn mammals are enzymatically equipped to digest and utilize the two-ring lactose molecule. There are several species-oriented categories of commercial animal feeds formulated for with lactose sources, including feeds for young: dairy calves, veal calves, piglets, lambs, foals and goat kids.

The lactose sources can be either liquid or dry, depending on the feeding systems. There are several lactose containing ingredients including: dried whey, dried permeate, dried skim milk, WPC, and crystalline lactose monohydrate. The following are major feed types that are formulated with lactose sources:

Dairy product prices edged higher at the Global Dairy Trade auction, rising for the second time in six auctions, as gains in milk fats offset a decline in milk powders. The GDT price index rose 0.3 per cent from the previous auction three weeks ago to $3,323. Some 33,501 tons of product was sold, up from 32,260 tons at the previous auction.

Global dairy prices slipped slightly at the latest auction on Wednesday, moderating further from a rally earlier in the year. The GDT Price Index dipped 0.4 percent, with an average selling price of $3,339 per ton. A total of 32,260 tons was sold at the latest auction, down 1.6 percent on the previous sale. Prices for whole milk powder fell 0.6 percent, as skim milk powder prices rose 0.3 percent.

Over 175 dairy producers, processors and allied industry representatives gathered in South Lake Tahoe to attend the 118th California Creamery Operators Association Annual Meeting to discuss the future course of the California Dairy Industry. Experts from academia and industry shared new information that can help California’s Dairy industry chart a new strategic course. 

Dairy product prices fell at the Global Dairy Trade (GDT) auction, dropping for the third time in four auctions, amid concern about extra supply. The August 1st GDT price index slid 1.6% from the previous auction two weeks ago to $3,343. Some 32,768 tons of product was sold, up from 26,688 tons at the previous auction.

Global dairy prices inched up at auction, rebounding slightly from a fall at a similar sale earlier in the month, according to Global Trade Events which holds the bi-monthly auction. The Global Dairy Trade (GDT) Price Index edged up 0.2 percent, with an average selling price in the auction of $3,387 per ton. The index had slipped 0.4 percent at the previous sale, moderating after a strong run earlier in the year.