Fall 2015 Pass the Butter
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1 Fall 2015 Pass the Butter Eat Butter was a memorable Time Magazine cover for the dairy industry. Since June 2014 when the issue hit the shelves, butter and full-fat dairy products are getting a second look. Dairy fat may no longer be the diet villain. Over the past few months, the dairy market fluctuated with the surging demand and tightening supply of dairy fat. Summer s peak demand for ice cream and butter boosted costs and the Midwest and Northeast reached the second highest price for the month of July since 1998 at $2.81 per pound of wholesale cream. In the past year, ice cream sales rose by about 2.7 percent and butter sales increased 17 percent. An Attitude Change Retail analysts anticipate that consumers will continue to move away from skim milk and margarine. Consumer attitudes are shifting towards whole milk and butter. Retail shoppers continue to look for transparent and healthy products. The average consumer understands the ingredients in dairy and butter, for example, is one of the simplest items on the shelf: cream and salt. Keep It Simple Stupid. No Longer a Villain In 1977, Americans were urged to stay away from dairy, red meat and eggs by the Dietary Goals for the United States. At the time, dairy especially butter, was thought to increase the chances of cardiovascular disease. A meta-analysis published by the Annals of Internal Medicine in March of 2014 reevaluated saturated fat and heart disease, finding no link between the two, and prompted Time Magazine s Eat Butter. The European Journal of Nutrition recently concurred that people who eat full-fat dairy are no more likely to develop cardiovascular disease and Type 2 diabetes than those who consume low-fat dairy. Not only is there a lack of support for the link between full-fat dairy and heart problems, but no evidential link between full-fat dairy and obesity. Many recent studies, including the European Journal of Nutrition, show no support that low-fat dairy is healthier than full fat. When observing obesity factors, 18 out of 25 studies reported lower body weights and less weight gain for full-fat dairy consumers. The Scandinavian Journal of Primary Health Care s 2013 study reported that those who frequently ate full-fat butter, milk and cream, had lower obesity rates than those who avoided dairy fats. Dairy fatty acids provide satiety. Moderate consumption of dairy fat can help a person feel fuller sooner and stay full longer. Recent studies suggest there may even be a link to dairy fatty acids playing a role in gene expression and hormone regulation. Further research may prove that dairy fat can affect how much energy the body burns and the amount of fat it stores. Butter is Back Butter and high fat dairy products are making a comeback with growing demand. Simple ingredients and science are the sidekicks who helped dairy become a hero product again.
2 The Dairy Market Report Butter On the week of September 21st, the butter market rose cents, starting on Monday at plus 3.75 cents; Tuesday, plus 7.75 cents; Wednesday (after release of the Cold Storage report), plus cents Matching the price rise at the CME, several butter-trading contacts reported the market tightened further near the end of September. McDonald s recently announced a switch to using real butter in menu items and it injected a dose of perceived upside butter sales potential across the foodservice channel. Meanwhile, retailers upped their orders to ensure adequate supplies during the Holiday season now that butterfat is back in vogue among consumers. This, after California production declined 23 million pounds during the first eight months of The result: a few manufacturers were short of their forecasted requirements for the 4th Quarter selling season and, adding to the speed of the price increase, the spot butter market was very thin. In recent weeks and days both of these issues intensified as industry sentiment shifted from calm to nervous. Even so, the Cold Storage report showed historically normal inventories on 31 August at 209 million pounds. In the coming weeks it is anticipated that sales forecasts will be reduced and confirmed and the market will realize that is adequately supplied. International Market While domestic demand for cheese and milk products has continued to rise steadily, exports have suffered from reduced international demand. Lower world dairy prices, significantly below those in the U.S., have attracted the attention of international buyers. This too has attracted the attention of international sellers: U.S. imports of cheese and dried milk proteins have been above year-earlier levels. But, overall, total imports remain less than 4 percent of domestic production. In the nonfat dry milk market, for the first time in a long while, we heard about USA powder inquiries coming from Chinese buyers. Data also indicate sales into the country have perked up: Chinese skim milk powder imports increased 11% (+1,975MT) during August. This is the first YoY increase in 13 months. Chinese cheese imports were 25% above year-ago levels (+1,004MT) during the month while whey imports were up 7.1% (+2,482MT). Butterfat imports were also positive, up 23% (+1,025MT) after having averaged down 36% during the first seven months of the year. The data and forecasts in this report are excerpts from the Dairy & Food Market Analyst by Jerry Dryer and Matt Gould. mgould@dairymarketanalyst.com Page 2
3 Profile: Shetakis Foodservice In 1948, Jim Shetakis began distributing food out of the back of his truck. Today, Shetakis Foodservice is the largest independent food distributor in Las Vegas. Family-owned since 1959, Shetakis abides by their reputation of quality, integrity and dedication to customer satisfaction. Distributors of a variety of products ranging from dry groceries, meats, seafood, gourmet specialties and more, Shetakis caters to a variety of venues. Located near the Las Vegas Strip, the company services major resorts, restaurants and casinos. State-of-the-art facilities house top-of-the-line products guaranteed to perform. Shetakis focuses its catalog on nationally branded products to ensure consistent quality. As a UniPro member, Shetakis uses purchasing power to leverage the cost of goods to its customers, while providing a variety of products. Shetakis manages its own fleet of over 30 vehicles for distribution. The company utilizes technological advancements to reduce fuel and energy consumption in every aspect of their business. Shetakis is one of the primary distributors of Grassland products on the Las Vegas strip. Carrying Grassland and Country Cream butter solids and portion control items, Shetakis also promotes the Wüthrich specialty items, including clarified butter. Shetakis portfolio focuses on nationally branded products that provide consistent quality. The company selected Grassland s butter products to fulfill that focus in the butter category. The Independent Choice for Las Vegas We create and maintain relationships built on a history of trust. For over 30 years, Shetakis reigns as the largest independent food distributor in Las Vegas. The company is dedicated to Quality, Service and Integrity while providing customer satisfaction. The articles and commentary in this newsletter do not necessarily reflect the views of Grassland Dairy Products, Inc. Page 3
4 Dairy Application: Cultured Dairy Beverage with Buttermilk Grassland Dairy Products, Inc. s Sweet Cream Buttermilk Powder is manufactured by spray-drying the liquid buttermilk obtained from sweet cream butter production. Ingredients Application for Buttermilk in Cultured Dairy Beverage Amount Grassland recently featured this ingredient application at IFT. For more information, please ingredientsales@grassland.com. Milk, 2% Milk, nonfat/skim with added Vit. A & D Sweet Cream Buttermilk Powder Yogurt Stabilizer 40.66% 40.66% 1.59% 0.05% Photo courtesy of the Wisconsin Milk Marketing Board, Inc. Vanilla Base 17.04% Nothing But the Udder Truth Dairy Management, Inc. (DMI) recently hired the satirical The Onion to produce the Udder Truth campaign. DMI is a farmer-funded dairy promotions organization with the intent to change consumer perceptions about dairy farming. The Udder Truth campaign targets millennials with the intention of redirecting them from popularly absurd news headlines to the serious Udder Truth content. Radioactive Panda Tears in Your Milk? from The Onion s webpage links to videos that address popular topics about dairy farms on The campaign already established videos that discuss animal welfare, large dairy farms and antibiotics. This fall, DMI will launch another video series, Acres and Avenues, where farmers will trade places with someone from a city for the day. From the producers of the Got Milk? campaign, DMI strives to educate consumers about the udder truth of the dairy industry. Page 4
5 Product Profile NutraPro Milk Protein Isolate Grassland Dairy Products, Inc. s NutraPro-MPI is manufactured from the ultrafiltration and spray-drying of skim milk, which is sourced from farm-fresh whole milk. NutraPro-MPI is created using a low-heat filtration process which generates an undenatured protein and a highly nutritional Milk Protein Isolate (MPI). The low-heat method creates a NutraPro-MPI with high stability and solubility properties. NutraPro-MPI is obtained during the filtration process by reducing the water, lactose, and mineral levels to craft a MPC with a protein level of 90%. The casein-to-whey protein ratio is not affected during this process and remains the same as raw milk. Applications: superior protein source, adult and infant nutrition, cultured dairy products, lactose-free labeling, sports nutrition beverages, weight management and more... Sample our NutraPro MPI application at Food Ingredients Europe in December! Grassland s Story Over a Century of Dairy Passion Grassland Dairy Products, Inc. maintains the Wuethrich family legacy with more than a century of churning cream into delicious butter in Greenwood, Wisconsin. Grassland applies product research and development and continuous technological improvements to maintain its reputation as a quality dairy products manufacturer. With a variety of product offerings, Grassland commits to exceeding the needs of their dairy retail, foodservice and industrial customers, both domestic and international. Each product is made with the same commitment to quality, service and value as established by John S. Wuethrich in Grassland and West Point Dairy Products LLC continue to build on a fundamental commitment to delivering unsurpassed quality and value. Grassland Dairy Products, Inc. N8790 Fairground Avenue, Greenwood, WI (800) Page 5
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