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Dairy industry lagging behind consumer preferences

An ag economist says the make-up of how dairy is consumed has changed but overall consumption is the highest since 1975.

David Widmar with Ag Economic Insights tells Brownfield milk consumption per capita has grown by about 100 pounds over the past 40 years.

“We were at about 540 pounds of consumption per person and now we’re up about 640 pounds.”

In that time, butter and cheese consumption has risen while fluid milk has trended lower at the same time the U.S. population has nearly doubled.   

Short-term shifts have also emerged according to Widmar including increased whole milk consumption and declining yogurt consumption in the last five years and some processors haven’t been able to remain nimble through changes in consumer preferences.

“When we make these long-term capital investments in processing facilities, we have to make some assumptions to where the future might be for the consumption of dairy.”

Many analysts expect processing plants to undergo industrywide changes in the coming years to better reflect consumer demand and shifts in where milk is produced to align with current dynamics.