Milling & Baking News Corporate Profiles - 2019 - 38

INDUSTRY REVIEW: DAIRY

Dairy
Cheese category grows, withstands plant-based challenge
t takes approximately 10 lbs of milk to make 1 lb of cheese, demonstrating
that cheese is a dense source of milk solids, namely high-quality protein
(contains all of the essential amino acids in the ratio that the body requires) and a range of fats. Despite the overarching plant-based movement
influencing consumers' grocery spending, this "concentrated" animal-derived
food continues to experience year-after-year growth, once again showing that
what consumers say and what they do does not always jive.
Per-capita consumption of cheese has more than doubled in the 40-year
period from 1978 (16.8 lbs) to 2018 (37.9 lbs), according to data from the
Economic Research Service of the U.S. Department of Agriculture. New forms,
varieties and uses are responsible for most of this growth.
Cheese is the one category where plant-based alternatives have little power.
While there are a number of players trying to reproduce the flavor, melt, mouthfeel and stretch of natural cheese, dairy cheese controls this space.
Convenient and snacking forms are where the actions is on the retail front, according to data from Information Resources, Inc., a Chicago-based market research
firm. During the 52 weeks ended Aug. 11, 2019, total natural cheese retail sales
were up 1.3%, registering in at $12,940.2 million. Shreds led the category with
sales of $4,805.1 million, up 1.5%, followed by chunks (1%, $3,549.9 million)
then slices (1.8%, $2,280.4 million). Cubes showed the most growth, (10.5% to
$116.8 million), with sales of many cubes and other snacking formats not measured
as cheeses sales by I.R.I., as they are being sold in snack packs with other items.
Chicago-based Dutch Farms is rolling out an On-the-Go Protein Pack in two
combinations. Varieties include string cheese with one hard-cooked peeled egg
and pepperoni slices and pepperjack cheese stick with one hard-cooked peeled
egg and Genoa salami. The Hormel Natural Choice snack pack line from Hormel
Foods, Austin, Minn., features premium components such as Mediterranean-style
chicken paired with bruschetta jack cheese alongside garlic and herb pita chips.
Cheese also is used in many prepared foods positioned as plant-based

products, as plant-based and vegetarian does not mean vegan. Cheese may
be found in everything from vegetable lasagna to salad kits to pea protein
snack puffs. In fact, it's estimated that approximately one-third of all cheese
consumed in the United States is as an ingredient in prepared foods, which is
likely due to its versatility and its ability to make everything taste better. Traditional favorites such as cheddar and mozzarella comprise more than half of
all-natural cheese consumption, according to the U.S.D.A., but authentic ethnic
cheeses and creatively flavored American-type cheeses are gaining traction,
especially as snacking and entertaining foods.
While cheese may be shining, other dairy categories are struggling as consumers explore the many varied new plant-based options entering the marketplace.
Processors are adding value to differentiate, and in many instances, it's working.
Fluid milk sales have been declining for the past few decades and may
finally be stabilizing at retail. While skim and low-fat white milk retail sales
were down 4.7% ($6,453.3 million) for the 52 weeks ended Aug. 11, 2019,
whole white milk sales were up 2.6% ($4,326.4 million). Value-added

LEADING NATURAL

shredded cheese vendors
1
2
3
4
5
6
7
8
9

Kraft Heinz Co.
Sargento Foods Inc.
Crystal Farms
Tillamook County Creamery
Dairy Farmers of America
Saputo Cheese USA, Inc.
BelGioioso Cheese
Cabot Creamery, Inc.
Dutch Farms
Private label
Total

Dollar sales
$928,138,629
$295,864,286
$112,301,553
$73,510,150
$73,091,837
$48,065,353
$40,283,820
$25,913,478
$24,743,129
$3,029,127,631
$4,805,123,881

©VM2002 - STOCK.ADOBE.COM

shredded cheese brands
% change
from
year ago
-3.6%
-10.5%
-5.2%
37.3%
6.8%
-8.5%
15.6%
45.6%
5.9%
4.5%
1.5%

1
2
3
4
5
6
7
8
9

Kraft
Sargento
Crystal Farms
Tillamook
Borden
BelGioioso
Philadelphia
Frigo
Cabot
Private label
Total

Dollar sales
$887,327,941
$295,864,286
$106,966,247
$73,510,150
$64,620,800
$37,494,259
$35,843,057
$32,970,687
$25,913,478
$3,029,127,631
$4,805,123,881

% change
from
year ago
-2.2%
-10.5%
-5.8%
37.3%
6.3%
13.9%
-27.7%
1.9%
45.6%
4.5%
1.5%

Data for 52 weeks ended Aug. 11, 2019
Total U.S. - Multi-outlet with C-Store (Supermarkets, Drugstores and Mass Market Retailers, Gas/C-Stores, Military Commissaries and Select Club & Dollar Retail Chains)
Source: Information Resources, Inc.

38 \ November 2019

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