Editorial Comment Publisher/Editor

 

 

Consumers Are Certainly Enjoying Milkfat These Days

Dick Groves
Publisher/Editor
Cheese Reporter

September 11, 2020


USDA’s Economic Research Service last Friday released its annual statistics on the supply and utilization of all dairy products on a milkfat, milk-equivalent basis, and from these figures we can conclude, among other things, that consumers are increasingly enjoying their milkfat these days.

Specifically, per capita consumption of all dairy products on a milkfat, milk-equivalent basis reached 653 pounds last year, up seven pounds from 2018 and up 48 pounds from 2010.

These per capita consumption statistics tell a mighty interesting story of how consumers have been turning, or more accurately turning back, to milkfat in recent years. Historically speaking, per capita consumption on a milkfat basis was under 600 pounds for a number of years, specifically from 1967 through the first several years of the 21st century.

Looking back at that period, per capita consumption on a milkfat basis reached a low of 539 pounds in 1975, and was more than 100 pounds below 2019’s level every year between 1974 (535 pounds) and 1981 (541 pounds).

It hasn’t been that low since then, but the climb out of that “basement” has taken quite some time. In 1999, per capita dairy consumption on a milkfat basis stood at 584 pounds, up just 20 pounds from 1970.

There were some notable increases in per capita consumption on a milkfat during several years in the 1980s, including a peak of 601 pounds in 1987, when the federal government gave away over 400 million pounds of cheese and 67 million pounds of butter from its inventory of surplus dairy products.

The anomaly of that year can be illustrated by the fact that, after 1987, per capita consumption on a milkfat basis didn’t reach 600 pounds again until 2005. Indeed, in the 1990s, it dipped as low as it was in 1970 once (in 1991), and below its 1970 level twice (562 pounds in 1992 and 563 pounds in 1996).

Once per capita consumption on a milkfat basis reached 604 pounds in 2005, it hasn’t fallen back below 600 pounds. However, consumption didn’t actually grow all that much for almost a decade: after climbing to 613 pounds in both 2006 and 2007, it fell back to 604 pounds by 2011, and was still 608 pounds in 2013.

But consumption took off after that, reaching 646 pounds in 2016, holding steady for a couple of years after that, and then rising to 653 pounds last year.

So what’s behind this increase in per capita consumption of dairy products on a milkfat, milk-equivalent basis? At least three product categories come to mind, and these three categories happen to be the three largest users of milkfat, according to ERS statistics.

First of all, there’s cheese, per capita consumption of which reached a record 38.3 pounds last year. Over 40 percent of the US milkfat supply (which ERS defines as the milkfat of domestic milk production plus the milkfat of imported dairy products assumed to be used as ingredients in domestically produced dairy products) goes into cheese products, so the steady rise in per capita cheese consumption has undoubtedly helped boost overall per capita consumption on a milkfat basis.

The other two key products in this milkfat consumption increase are butter and fluid milk, although it’s worth noting that more of the milkfat supply is used in cheese than in fluid milk and butter combined.
Interestingly, the importance of butter and fluid milk in overall per capita milkfat consumption has changed since the turn of the century.

Specifically, back in 2000, slightly more of the US milkfat supply was used in fluid milk products (about 1.1 billion pounds) than was used in butter (1.0 billion pounds). That was still the case as recently as 2006 (1.069 billion pounds of milkfat was used in fluid milk products, while 1.066 billion pounds was used in butter).

But since then, butter has used more milkfat than has fluid milk. That gap in milkfat use grew from 182 million pounds in 2007 to 538 million pounds in 2018. And the gap grew in large part because per capita butter consumption increased from 4.7 pounds in 2008 to 6.2 pounds last year.

Meanwhile, fluid milk has been floundering for many, many years, and so fluid milk’s use of milkfat isn’t as significant as it used to be. Specifically, less than 1 billion pounds of milkfat has been used in fluid milk products every year since 2011.

However, there has been a slight rebound in milkfat use in fluid milk products in recent years, thanks to the recent rise in whole milk sales. The volume of milkfat used in fluid milk products bottomed out in 2014 at 956 million pounds, but rebounded to more than 980 pounds each year from 2016 to 2018 (2019 figures aren’t available yet).

As positive as these recent increases in milkfat consumption are, the dairy industry still has a ways to go to get per capita dairy consumption on a milkfat basis back to where it was up until about the mid-1950s. ERS figures show that per capita consumption first topped 800 pounds in 1925, was last above 800 pounds in 1944, and was above 700 pounds as recently as 1956.

Cheese wasn’t the key contributor to those lofty consumption heights, with per capita consumption reaching a record eight pounds in 1956. Instead, it was butter, per capita consumption of which was 9.0 pounds in 1956, and fluid milk, per capita consumption of which was 322 pounds that year (92 percent of which was whole milk).

Consumers love milkfat, but not as much as they used to.

 

Dick Groves

Dick Groves has been publisher/editor of Cheese Reporter since 1989. He has over 40 years experience covering the dairy industry. His weekly editorial is read and referenced throughout the world.
For more information, call 608-316-3791 dgroves@cheesereporter.com
https://twitter.com/cheesereporter.


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