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Dairy Industry In 'Crisis' As Milk Sales Plummet

Tuesday, 11 Dec 2012 10:31 AM

By Bill Hoffmann

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The milk industry appears to be in deep trouble, with consumption of milk products having dropped nearly 30 percent since 1975, the Wall Street Journal reports.

The dairy industry "is coming to recognize this as a crisis. We cannot simply assume that we will always have a market," Tom Gallagher, CEO of the trade group Dairy Management, told the newspaper.

The Journal sites several reasons for the decline: rising prices, more people drinking bottled water, concern by consumers that milk is high in calories, and the fact that children, who are big milk drinkers, now account for a smaller share of the U.S. population.

According to the USDA, Americans drank about 20.2 gallons of milk last year, a drop of 3.3 percent from the previous year.

And while sales of organic milk are up, that accounts for only about 4 percent of retail sales.

The dairy industry is attempting to flight back by introducing new products and using new marketing.

Supermarket chain Kroger is planning to sell “CARBmaster,’’ a milk with 20 percent more protein and less sugar.

And Arizona’s Shamrock Farms sells 12-ounce bottles of milk at Subway restaurants and seven-ounce bottles at Arby's restaurants that are targeted at children.

Despite the waning consumption of milk, the sales of some other dairy products, such as yogurt and cheese, have increased, the Journal reports.




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