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Young cheesemakers explore new ideas, carry on tradition

July 20, 2018

By Rena Archwamety

MADISON, Wis. — Marie-Laure Couët hadn’t always planned to be a cheesemaker. She had no background in
cheesemaking or farming when she graduated in 2009 from Brown University with a master’s degree in environmental studies.

“I wanted to do policy work, but no one was hiring,” Couët says. “My first thought was, ‘I want to have goats, and I needed to survive, so I should make cheese with their milk.’”

Couët spent two years traveling through France, Spain and Italy, seeking internships with goat dairies, cheesemaking operations and affineurs. She also worked with U.S. cheesemakers before opening her own business, Couët Farm & Fromagerie, in Dudley, Massachusetts, in 2015.

Making cheese was so time-consuming that Couët abandoned the idea of raising goats. She has adapted some goat’s milk cheese recipes to create her own versions of cheeses made with cow’s and sheep’s milk, which was more readily available.
“All my cheeses are named after my great-grandmothers. All of the cheeses mimic styles that I learned, but they evolved as I was honing the recipe and making them my own,” Couët says.

Couët’s cheeses now are distributed as far as California, and she has won several awards for her cow’s and sheep’s milk European-style cheeses. She received first-place awards at the American Cheese Society competition in 2016 for her Franciszka Jersey cow’s milk crottin, and in 2017 for Fleur de Maquis, which is Franciszka covered in rosemary, fennel seeds, savory herbs and juniper berries.

• Next generation

Couët, now 34, is one of several millennial cheesemakers gaining notice across the country. Some have started new businesses focused on small-batch artisan cheeses, while others are continuing the legacy of family businesses, exploring new products or continued expansion.

Several plants across Wisconsin are moving into third-, fourth- and fifth-generation cheesemakers.

“I think it’s happening with greater frequency than one could hope,” says John Umhoefer, executive director, Wisconsin Cheese Makers Association (WCMA). “At each of the private, proprietary family plants, it seems almost all have a next generation who has decided to stay in the industry. It’s really nice to see that the next generation is seeing the opportunity. Cheese is actually a hot food right now, and I think they’re interested in the craft of it.”

Darrell Demeter, 28, is a fifth-generation licensed Wisconsin cheesemaker as well as certified pasteurizer and dairy process operator at Door Artisan Cheese, Egg Harbor, Wisconsin. He works alongside his father, Wisconsin Master Cheesemaker Jim Demeter, in the business that opened in spring 2017. Both of them previously made cheese at Agropur’s Little Chute, Wisconsin, facility, where Darrell’s brother Nate, 32, also currently is a certified cheesemaker, pasteurizer and dairy process operator.

From early on, Darrell Demeter knew he wanted to be a cheesemaker.

“I worked with my dad in the cheese plant at Trega Foods in Weyauwega (later purchased by Agropur) in high school during summer breaks,” he recalls. “It was an easy choice for me to pick cheesemaking as a career since it’s been my family’s craft for generations.”

Earlier this year, Darrell Demeter took home a best-of-class award at the World Championship Cheese Contest for his traditional English-style cloth-wrapped Top Hat Cheddar that he made at Door Artisan Cheese.

“As a unit, we really were able to dive into creating world-class cheese,” Demeter says of working with his father. “It was phenomenal working with the product — testing and watching it evolve.”

Currently Darrell and Jim Demeter are working on Swiss, which Darrell says is brand new for him.

“My dad made it back when he was my age, working in his father’s plant in northern Illinois,” he says. “Now, we are able to bring this old family recipe back to the vat.”

Ben Workman, 33, is plant manager and cheesemaker at Edelweiss Creamery, Monticello, Wisconsin. He works alongside his father, Wisconsin Master Cheesemaker Bruce Workman, owner and founder of Edelweiss, which specializes in traditional big-wheel Emmentaler production.

Ben Workman initially wanted to pursue a different career path, majoring in microbiology and cellular biology and minoring in chemistry at the University of Wisconsin-Oshkosh, which led to a job as an associate chemist for a pharmaceutical company. However, when his father approached him about joining the cheese business and making it a lineage factory, he felt the calling.

“It took about a year of convincing — first from him, and then me talking with my wife, for me to make the change,” Workman says. “When I did, I fell in love with cheesemaking. I looked at it not only as an art, but as a science. Being a science geek, milk is one of the most complicated biological substances there is — it’s beautiful, crazy! That made me develop a passion for the industry.”

Ben Workman says he enjoys making Emmentaler the most, and he is in the process of developing some new cheeses for the company.

“I’m a scientist by trade, so experimentation is one thing I excel at,” he says. “Observing, monitoring and implementing are all part of the experimentation process. What I love about cheesemaking is that it’s all a practical experiment, not just theoretical. It’s hands-on — you get to make it and directly see the results of your effort.”

• Learning opportunities

Young cheesemakers find support and educational opportunities from more established cheesemakers and companies as well as through courses and university programs.

Wisconsin is the only state in the country that requires its cheesemakers to obtain a license, which entails a combination of short course training and workshops as well as 240 hours of apprenticeship. WCMA recently launched WCMA Young Professionals, creating a network as well as training opportunities for those under 40 in the cheese industry. The University of Wisconsin-Madison campus also is home to the Center for Dairy Research (CDR), which provides these trainings and workshops as well as support to both new and established cheesemakers in recipe development, troubleshooting and other issues.

“CDR is the best resource in the country for cheesemaking seminars and workshops, but also just personnel that make themselves available to people,” Umhoefer says.

In Sonoma County, California, 30-year-old Joe Moreda Jr. is vice president and plant manager, as well as head cheesemaker, at the family-owned Valley Ford Cheese and Creamery. His mother Karen Bianchi-Moreda, the fourth generation of the Bianchi family dairy farm, started the cheese business in 2008. As president of the creamery, she has since transitioned to business management aspects of the company, leaving her son in charge of the cheesemaking. The creamery currently produces three award-winning raw milk cheeses: Estero Gold and Estero Gold Reserve Montasio-style aged cheeses; the washed-rind, Fontina-style Hwy 1; and the newest Grazin Girl, a Gorgonzola-style cheese introduced in late 2017. Estero Gold Reserve was twice named Best of Show at the California State Fair.

“I was fortunate enough to work an internship with Point Reyes Farmstead Cheese Co. in the summer of 2006, right before I was set to head off to college. I instantly knew that the dairy product manufacturing industry is where I wanted to end up,” Moreda says.

He graduated in December 2010 from Cal Poly, San Luis Obispo, with a bachelor’s degree in dairy science with an emphasis in dairy products technology and a minor in agricultural business.

“Not only did I gain knowledge in the classroom from world-class dairy products professors such as Dr. Nana Farkye and Dr. Rafael Jiminez, but I also had the opportunity to work as a paid employee at the Cal Poly Creamery throughout my whole 4.5 years of college,” he adds. “I gained hands-on experience making cheese, ice cream, butter, yogurt, dry milk powder and bottled milk, and also learned other important aspects of an operation, such as quality, sanitation, inventory management, pasteurization and the mechanics of operating equipment.”

In addition to his internship at Point Reyes, Moreda also interned at Petaluma Creamery and Leprino Foods before deciding to return home to join the family business.

On the East Coast, Couët says she received a lot of support from other cheesemakers as well as from participating in the Massachusetts Cheese Guild as she was starting her business.

“I developed informal mentorships and would reach out to cheesemakers in the Northeast if I had questions,” she says. “This is what I love about the cheesemaking community — almost everyone that I’ve ever met has been very supportive and very open about how they do things, down to the cheesemaking recipes.”

Demeter says it’s an honor to work among some of the most experienced and recognized people in Wisconsin’s cheese industry.

“Everyone has their own history, their own story and their own tricks of the trade,” he says. “There’s such a respect in the industry since people work so hard to make their product and we all do it a little bit differently. It’s a big industry, and I’m learning something all the time.”

• Room to grow

Umhoefer notes that in addition to small artisan cheesemakers breaking ground, he also sees next-generation cheesemakers looking to expand and compete at a higher level to help their families’ cheese factories continue through future generations.

Couët says she has grown her business between 2015 and 2017, going from selling her cheese at local markets to now working through four distributors that sell her cheese across several states.

“We’ve certainly grown substantially, but I am impatient, and I want to grow substantially more,” she says. “We’re certainly in the black, but I feel to be in a comfortable place financially for the business, we need to grow. I would like to double our sales by 2022.”

When Moreda first joined the family company, it was producing around 450 pounds of cheese per week. Seven-and-a-half years later, Valley Ford Cheese and Creamery produces 3,000 pounds per week, with plans to double in the near future. A new 5,000-square-foot retail shop also is slated to open later this year.

“We plan on growing our sales and distribution and are currently in the development stage of multiple new products,” Moreda says.

“My biggest personal long-term goal is to purchase a piece of land somewhere in Sonoma County, preferably as close to Valley Ford as possible, and build a brand-new, state-of-the-art dairy product manufacturing facility,” he adds. “This will be a massive undertaking and will take years of planning, financing and hard work, but it will offer us the ability to put our personal stamp on the industry, grow our business exponentially, help the local economy and provide even more opportunities for future generations.”

CMN


Industry praises FDA response to imitation labeling concerns

July 20, 2018

WASHINGTON — FDA Commissioner Scott Gottlieb told an audience at a Politico Pro Summit this week in Washington, D.C., that his agency will soon begin enforcing regulations that define milk as an animal product, not a plant-based food, an indication that requests for action by the agency from dairy stakeholders including the American Dairy Coalition (ADC) and the National Milk Producers Federation’s (NMPF) are being heard.

After acknowledging that “an almond doesn’t lactate,” Gottlieb said the agency soon will seek public input as a prelude to enforcing existing regulations on dairy labeling standards.

“There will be people who make a counter argument that almond milk should be able to call itself milk, but we do have a standard of identity, and I do intend to enforce that,” Gottlieb says.

He adds that the agency’s first step will be opening a period for gathering public comments. He estimates that the process for developing guidance will take close to a year to complete.

The news was applauded by ADC, a farmer-led national lobbying organization that just this week rolled out a new initiative to advocate for the proper use of federally standardized terms for the word “milk” on product labels. A branch of ADC, the Protecting Milk Integrity Initiative will work to provide clarity and consistency for consumers across the nation.

ADC notes that in more than 200 countries across the world, plant-based juices are not allowed to call their product “milk” on labels unless they are, in fact, derived from a mammal.

The Protecting Milk Integrity Initiative has developed a petition to collect signatures, will be submitting public comments and will be taking donations to raise money toward promoting this cause. To learn more about the initiative, visit www.americandairycoalitioninc.com/the-integrity-initiative.html.

NMPF also welcomed Gottlieb’s comments and intent to enforce labeling standards.

“After years of inaction in response to our complaints about these labeling violations, Gottlieb’s announcement that the agency is intending to act on this issue is very encouraging,” says Jim Mulhern, president and CEO, NMPF. “The marketing of non-dairy imitators must comply with federal standards of identity, and consumers should not be misled that these products have the same nutrition as real milk, yogurt, cheese and other actual dairy products.”

When asked about other mammals’ milk and labeling concerns, NMPF says it fully recognizes the suitability of a qualifier such as “goat” or “sheep” being used to distinguish among various types of mammalian lacteal secretions.

NMPF says the plethora of plant-made products using “milk” on their labels contradicts the statement of identity for milk on its most basic level — i.e., the source of milk must be an animal, specifically, a lactating cow. While there also are standards of identity for products made from the milk of other animals (i.e. goat, sheep and water buffalo) for specific cheeses and/or ice cream (21 CFR 133 and 135, respectively), in all cases, the term “milk” refers to the lacteal secretion from a mammal, NMPF says.

While the current FDA Standard of Identity for Milk is stated in 21 CFR 131.110 as “lacteal secretion, practically free from colostrum, obtained by the complete milking of one or more healthy cows,” ADC notes that in the CFR Title 21-Part 102 — Common or Usual Name for Non Standardized Foods — ADC believes the rest of the hoofed animals fall in to this definition: “The common or usual name of a food, which may be a coined term, shall accurately identity or describe, in as simple and direct terms as possible, the basic nature of the food or its characterizing properties or ingredients. The name shall be uniform among all identical or similar products and may not be confusingly similar to the name of any other food that is not reasonably encompassed within the same name.”

“The larger point is that food definitions do not allow for the use of vegetable and plant products to be the source of the ‘milk’ or ‘cheese,’” NMPF says.

NMPF wrote to Gottlieb last year to complain that the agency has not been enforcing labeling standards, pointing out that FDA’s lack of action “has led to rampant consumer fraud related to the inferior nutrient content of these non-dairy products compared to their true dairy counterparts,” Mulhern says, adding that in addition to fake “milks,” there also are a proliferation of products calling themselves “yogurt,” “cheese,” “ice cream” and “butter.”

The enforcement issue is not just an arcane dispute, but has significant public health implications because dairy imitators lack any consistent nutritional profile, while real milk always has the same nutritional package, varying only by standardized fat content, NMPF says.

“Consumers who purchase these imitations are not receiving the same level of nutrients found in cow’s milk, and that contributes to Americans falling short of the recommended amount of vitamins and minerals for a healthy diet,” Mulhern says. “FDA must act on this matter or else see the further decline of proper nourishment of our children and families.”

NMPF notes Gottlieb’s comments this week are similar to testimony he presented this spring to the Senate, when he acknowledged that the agency has “exercised enforcement discretion” in not holding food marketers to federal standards limiting the use of standardized food terms.

Mulhern says he hopes the agency will rapidly move to take enforcement action, adding that “this issue can be quickly resolved.”

Concern over labeling of imitation products also has been raised at the state level. This week, Sheila Harsdorf, secretary of the Wisconsin Department of Agriculture, Trade and Consumer Protection, sent a letter to Gottlieb expressing concern over the agency’s policies on food labeling.

With an increasing number of plant-based products being marketed as milk, it is critical that FDA enforce labeling that provides clear and transparent information to consumers, Harsdorf says.

“Given agriculture’s many contributions to our state and national economies, upholding standards of identity is critical to the industry as well as beneficial to consumers,” Harsdorf says. “Without prompt action and enforcement by the FDA, we will continue to see more and more mislabeling of products, such as milk, that do not meet the FDA’s own definitions.”

In the letter, Harsdorf, like ADC, also notes that regulators in other countries are enforcing their standards and definitions not allowing plant-based products to be labeled or marketed as milk.

She says it is imperative that the United States does the same in order to not be placed at a competitive disadvantage.

“As a nation, we need honesty and accuracy in the labeling of food products and consistency in enforcement of existing standards,” Harsdorf says. “As food innovations continue to emerge, it is essential that standards of identity and labeling requirements are clear and enforced to maintain the integrity of the agricultural industry and clarity in the marketplace for consumers.”

Meanwhile, FDA is gearing up for a public meeting July 26 in which the agency will discuss and receive comments on topics including food labeling, use of the “healthy” claim and standards of identity.

Gottlieb says the meeting will cover three areas of renewed focus for FDA: modernizing labeling claims, modernizing ingredient labels and modernizing standards of identity. FDA also is opening a docket to take public feedback on these issues to help guide its decision making. FDA specifically is interested in the implementation of its current standards of identity, whether it should be enforcing them differently and whether it should update some of those existing standards.

“Depending on what we learn, we may step up our enforcement efforts against false or misleading labeling,” Gottlieb says. “For example, we need to more closely examine whether certain almond- or soy-derived products should be able to call themselves milk.” (See “FDA to hold public meeting July 26, seeks comments on Nutrition Innovation Strategy” in the June 29, 2018, issue of Cheese Market News.)

CMN


House sends 2018 Farm Bill to conference committee

July 20, 2018

WASHINGTON — The House of Representatives this week moved to send the 2018 Farm Bill to conference committee. Following the vote, Speaker Paul Ryan, R-Wis., named the House Republican conferees, members who will seek to resolve the differences between the two chambers’ bills, and Nancy Pelosi, D-Calif., named the Democratic conferees.

“Today, we move one step closer to delivering a strong, new farm bill to the president’s desk on time as he has called on Congress to do,” says House Agriculture Committee Chairman K. Michael Conaway, R-Texas. “America’s farmers and ranchers and rural America are struggling right now, and they deserve the certainty of a strong farm bill to see them through to better times. The House has pulled together a solid team of conferees from across the country who are committed to working with our Senate colleagues to reach a final product that helps millions of low-income Americans climb the economic ladder while standing by the hard-working farm and ranch families who put food on our tables and clothes on our backs.”

The House Republican conferees include:

• House Ag Committee — Mike Conaway (Texas), Glenn Thompson (Pennsylvania), Bob Goodlatte (Virginia), Frank Lucas (Oklahoma), Mike Rogers (Alabama), Austin Scott (Georgia), Rick Crawford (Arizona), Vicky Hartzler (Missouri), Rodney Davis (Illinois), Ted Yoho (Florida), David Rouzer (North Carolina), Roger Marshall (Kansas) and Jodey Arrington (Texas).

• House Education and the Workforce Committee — Virginia Foxx (North Carolina) and Rick Allen (Georgia).

• House Energy and Commerce Committee — John Shimkus (Illinois) and Kevin Cramer (North Dakota).

• House Financial Services Committee ­— Jeb Hensarling (Texas) and Sean Duffy (Wisconsin).

• House Foreign Affairs Committee — Ed Royce (California) and Steve Chabot (Ohio).

• House Oversight and Government Reform Committee — Mark Walker (North Carolina) and James Comer (Kentucky).

• House Natural Resources Committee — Rob Bishop (Utah) and Bruce Westerman (Arizona).

• House Science, Space, and Technology Committee — Ralph Abraham (Louisiana) and Neal Dunn (Florida).

• House Transportation and Infrastructure Committee — Jeff Denham (California) and Bob Gibbs (Ohio).

The House Democratic conferees include:

• House Committee on Agriculture — Collin Peterson (Minnesota), David Scott (Georgia), Jim Costa (California), Tim Walz (Minnesota), Marcia Fudge (Ohio), Jim McGovern (Massachusetts), Filemon Vela (Texas), Michelle Lujan Grisham (New Mexico), Ann Kuster (New Hampshire) and Tom O’Halleran (Arizona).

• Education and Workforce Committee — Alma Adams (North Carolina).

• Energy and Commerce Committee — Paul Tonko (New York).

• Financial Services Committee — Maxine Waters (California).

• Foreign Affairs Committee — Eliot Engel (New York).

• Natural Resources Committee — Raúl Grijalva (Arizona).

• Oversight and Government Reform Committee — Stacey Plaskett (Virgin Islands).

• Science, Space and Technology Committee — Eddie Bernice (Texas).

• Transportation and Infrastructure Committee — Cheri Bustos (Illinois).

Meanwhile, the Senate still has to vote on a motion to go to conference as well as name its conferees, and Agriculture Chairman Pat Roberts, R-Kan., has indicated that may happen as soon as next week.

“We are pleased to see the House move ahead on the Farm Bill,” said Roberts and Ranking Member Debbie Stabenow, D-Mich., in a statement Wednesday. “In order to be successful in passing a final bill, the conference committee must put politics aside and focus on the needs of our farmers, families and rural communities. We are eager to go to conference, so we can move quickly to provide certainty for American farmers and families. Rural America is counting on us to get this right.”

Following the conference committee announcement, the National Farmers Union (NFU) called for a smooth conference committee process and swift passage of a farm bill that improves the farm safety net, farm sustainability and diverse markets for family farmers.

“The Sept. 30 expiration date for the current farm bill looms large, as family farmers and ranchers require the certainty of a strong farm bill now as much as any other time over the past several decades,” says Rob Larew, senior vice president for public policy and communications, NFU. “We’re hopeful that the conferees will respond to this immediacy by producing a bill, on time, that meets the needs of farmers, consumers and our nation’s food system. We urge the committee to ensure the final bill improves the farm safety net to deal with the current economic hardship facing farmers, promotes the environmental sustainability of family farm operations, and improves access to diverse markets for family farmers and ranchers.”

CMN


Trump asks WTO to intervene in tariff trade-off

July 20, 2018

WASHINGTON — The Trump administration this week challenged retaliatory tariffs imposed by five of its trading partners by filing a dispute with the World Trade Organization (WTO). The move is the latest escalation in trade tensions between the United States and countries with important markets for dairy, which began when America imposed steel and aluminum tariffs in April.

U.S. trade officials say that new tariffs imposed by China, the European Union (EU), Canada, Mexico and Turkey on American goods are not in line with WTO rules. Dairy products appear on the retaliatory duties lists from Mexico, Canada and China, which are the top three export markets for domestic dairy. The countries combined represent almost 47 percent of the dollar value of U.S. dairy exports last year, notes the International Dairy Foods Association (IDFA).

Eight countries already have filed WTO cases against the United States’ steel and aluminum tariffs. Disputes within the WTO can take at least a year to conclude and the appeals process can prolong the case for several years, IDFA says.

The Office of the U.S. Trade Representative (USTR) says that the U.S. steel and aluminum duties imposed by President Trump earlier this year are justified under international agreements the United States and its trading partners have approved but that retaliatory duties on U.S. exports imposed by China, the EU, Canada, Mexico and Turkey are completely without justification under international rules.

“The actions taken by the president are wholly legitimate and fully justified as a matter of U.S. law and international trade rules,” says USTR Robert Lighthizer. “Instead of working with us to address a common problem, some of our trading partners have elected to respond with retaliatory tariffs designed to punish American workers, farmers and companies. These tariffs appear to breach each WTO member’s commitments under the WTO agreement. The United States will take all necessary actions to protect our interests, and we urge our trading partners to work constructively with us on the problems created by massive and persistent excess capacity in the steel and aluminum sectors.”

CMN


Norseland builds market presence with fresh ideas and convenience

By Kate Sander

DARIEN, Conn. — Norseland Inc., best known in the United States for its Jarlsberg cheese, continues to grow its U.S. footprint with snack sizes, menu ideas and prepared foods that cater to all consumers seeking convenience and flavor.

“We’re expanding in the prepared deli and in the grocery grab-and-go cases,” says Valerie Liu, marketing manager, Norseland Inc.
As part of this strategic shift, Norseland —which is owned by Norway-headquartered TINE SA — will debut new ideas and products that cater to these trends at the International Dairy-Deli-Bakery Association (IDDBA) show in New Orleans this month.

At the show, Celebrity Chef George Duran will be on hand to offer new burger ideas and preview the company’s global summer burger promotion, which will hit social media and grocery stores in July.

Duran has made four burger recipes, each with a story: The Marvelous Meltdown (Jarlsberg Fondue Burger), Melted Maui Madness (Pineapple Bun Jarlsberg Burger), The Viva La Quinoa (Quinoa and Red Lentil with Jarlsberg) and The Brooklyn Bacon Bonanza (Bacon Burger Stuffed with Jarlsberg).

As part of the campaign, the four burgers have their own backstory and their own film. The campaign places the burgers in different settings, and the ambience is quintessentially New York: three of the four burger shorts are filmed in a Williamsburg brownstone, and the fourth on a rooftop in Queens with the Manhattan skyline as a backdrop. There also will be print materials for in-store use, including a burger-shaped brochure with the burger recipes.

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Innovation, convenience are key to steady dairy demand

July 13, 2018

By Alyssa Mitchell

EGG HARBOR, Wis. — Product innovation and accessibility are key strategies to staying competitive in a fast-moving, increasingly digitized and convenience-focused marketplace, according to panelists during a session at the Wisconsin Dairy Products Association’s annual Dairy Symposium in Egg Harbor, Wisconsin, this week.

During the session, panelists shared policy, consumer and retailer perspectives on dairy demand.

Randy Green, principal at Watson Green LLC, Washington, D.C., outlined some of the direct and indirect impacts policy can have on dairy demand, and vice versa.

For example, while the current Dietary Guidelines for Americans recommend lowfat and fat-free dairy, a resurgence in demand for full-fat dairy — as well as research on its benefits — in recent years may impact the development of the 2020 guidelines, he says.

Upcoming policy development on standards of identity and use of the term “healthy” on product labels also could have implications for the dairy industry, he says.

Meanwhile, Phil Plourd, president of Blimling and Associates, Madison, Wisconsin, notes the marketing landscape has largely shifted.

“We’re in a world where marketing costs very little compared to 20-30 years ago,” he says.

Plourd notes a lot of new players are not putting money into traditional marketing channels, but rather are capitalizing on social media and name recognition to attract consumers whose attention spans are shrinking.

At the same time, today’s consumers are looking for convenience in obtaining products including food. While millennials in particular are making fewer trips to the grocery store, e-commerce and food delivery options are booming.

“The question going forward is, how does dairy fit into that picture?” Plourd says.

Also at the session, Mike Brown, director, dairy supply chain, The Kroger Co., Cincinnati, shared some of the ways Kroger is working to fit into this environment, both in its stores and by offering consumers more options for shopping and delivery.

He notes consumers want “Anything, Anytime, Anywhere.” Using an example of salmon, Brown showed the various ways Kroger can offer the product to meet a variety of consumer demands. The store offers it fresh, uncooked and plain; fresh, but flavored, for easy cooking at home; as part of a larger meal kit to eliminate the guesswork and labor of putting a balanced meal together; and finally, as a fully-cooked meal for grab-and-go, ready-to-eat convenience.

Kroger also embraces a variety of consumers with its own brands, including its traditional Kroger brand as well as its Private Selection and Simple Truth (natural and organic) brands.

Kroger and Nuro — a provider of software and hardware expertise to design and build products that accelerate the benefits of robotics for everyday life — recently announced a new partnership to redefine the grocery customer experience for Americans by piloting an on-road, fully autonomous delivery experience: Restock Kroger.

The plan has four main drivers: redefine the food and grocery customer experience, expand partnerships to create customer value, develop talent, and live Kroger’s purpose.

“Unmanned delivery will be a game-changer for local commerce, and together with Kroger, we’re thrilled to test this new delivery experience to bring grocery customers new levels of convenience and value,” said Dave Ferguson, co-founder, Nuro, in a June 28 press release. “Our safe, reliable, and affordable service, combined with Kroger’s ubiquitous brand, is a powerful first step in our mission to accelerate the benefits of robotics for everyday life.”

As meal kit delivery also has increased in popularity, Kroger has merged with Home Chef, the country’s largest private meal kit company. Home Chef meal kits now are available to Kroger customers, both in stores and online.

Brown notes dairy plays a key role in all of these initiatives. Kroger has 20 dairy plants across the United States.

He adds that manufacturing is a competitive advantage so the company can better control costs, quality and innovation, as well as control raw product sources and better coordinate logistics.

Brown also outlined several dairy growth opportunities he sees, including increasing interest in natural and specialty cheeses, development of specialty dairy beverages and packaging innovation.

He says both long shelf life packaging and right-size dairy packaging have enormous growth potential. Right-size packaging in particular is huge as consumers continue to turn to dairy for snacking needs.

“It’s exciting times for dairy,” he says.

CMN


U.S. Senate pushes back on tariff escalation with China

July 13, 2018

WASHINGTON — As trade tensions heat up between the United States and several key exporting regions, the U.S. Senate this week expressed support for efforts by U.S. Sens. Bob Corker, R-Tenn., Pat Toomey, R-Pa., and Jeff Flake, R-Ariz., to ensure Congress plays an appropriate role in the implementation of national security-designated tariffs.

By a vote of 88-11, the Senate on Wednesday adopted a non-binding motion to instruct conferees considering H.R. 5895 — the Energy and Water Development and Related Agencies Appropriations Act of 2019 — to include language “providing a role for Congress in making a determination under Section 232 of the Trade Expansion Act of 1962” in the final legislation developed by the Senate and House conference committee.

Corker, Toomey and Flake say they will continue to push for a binding vote on legislation they introduced in June to require congressional approval of national security-designated tariffs.

President Trump has been engaged in a trade war with China since the Office of the U.S. Trade Representative (USTR) earlier this year concluded an investigation in which USTR found that China’s acts, policies and practices related to technology transfer, intellectual property and innovation are “unreasonable and discriminatory, and burden U.S. commerce.” (See “Dairy under pressure in U.S., China trade dispute” in the June 22, 2018, issue of Cheese Market News.)

Corker says the Senate this week “spoke loud and clear by overwhelmingly expressing support for our efforts to ensure Congress plays its appropriate role in the implementation of national security-designated tariffs.

“Tariffs are a tax on the American people, and as the U.S. economy and American businesses and consumers begin to feel the damaging effects of incoherent trade policy, I believe support for our legislation will only grow,” he says. “We will continue to push for a binding vote and are hopeful one will be scheduled in the near future.”

Toomey adds the administration is wrong to use “national security” as a pretext to impose taxes on steel and aluminum from the United States’ closest allies.

“It’s time for Congress to reassert its constitutional responsibility on trade, and (this week’s) bipartisan vote shows that there is a way forward to accomplish this,” Toomey says.

Flake says the vote represents the strongest and most straightforward message the chamber has delivered against the administration’s abuse of trade authority.

“Imposing tariffs on products from allies that pose no threat to our national security is just plain wrong,” Flake says. “I will continue to push for binding legislation that requires congressional approval of national security-designated tariffs. We have to rein in abuse of presidential authority and restore Congress’ constitutional authority in this regard.”

The measure’s fate in the House, however, is uncertain. News reports say House Speaker Paul Ryan, R-Wis., this week expressed doubt that legislation to bar Trump from imposing tariffs could carry a veto-proof majority.

Ryan did caution that the United States risks falling behind the rest of the world because other countries are pursuing free trade deals more aggressively, and said he hoped President Trump’s moves to impose tariffs on China and other nations was a negotiating tactic that would only remain in place until trade deals with those countries are worked out, news reports say.

Meanwhile, USTR in Wednesday’s Federal Register made good on its promise to establish a process by which U.S. stakeholders may request that particular products be excluded from new U.S.-imposed tariffs on Chinese goods imported into the United States.

The notice sets out specific procedures and criteria related to requests for product exclusions and opens up a docket for the receipt of exclusion requests.

USTR has set a deadline of Oct. 9, 2018, to receive exclusion requests.

USTR says approved exclusions will be effective for one year upon publication of the exclusion determination in the Federal Register, and will apply retroactively to July 6, 2018. Because exclusions will be made on a product basis, a particular exclusion will apply to all imports of the product, regardless of whether the importer filed a request. U.S. Customs and Border Protection will apply the tariff exclusions based on the product.

CMN


USDA lowers dairy product price forecasts in report

July 13, 2018

WASHINGTON — U.S. milk production forecasts for both 2018 and 2019 are lowered in USDA’s new “World Agricultural Supply and Demand” report released this week due to slower-than-anticipated growth in milk per cow and lower cow numbers.

USDA lowered its 2018 milk production forecast by 100 million pounds from last month’s report to 217.9 billion pounds, and lowered its 2019 projection to 220.6 billion pounds, down by 500 million pounds. Although tempered by lower expected feed costs, lower milk prices likely will weaken producer margins, resulting in lower cow numbers and slower growth in milk per cow, USDA says.

For 2018, the fat-basis import forecast is raised from the previous month on higher imports of butterfat products. Fat-basis imports are unchanged for 2019. The 2018 fat-basis export forecast is unchanged from the previous month but is raised for 2019 as the United States is expected to be price competitive and higher expected exports of butterfat products will more than offset expected declines in cheese exports, USDA says.

Skim-solids basis import forecasts for 2018 and 2019 are unchanged from the previous month. However, skim-solids basis exports for 2018 and 2019 are reduced from the previous month primarily on lower expected exports of skim milk powder and whey products as China’s tariffs on certain U.S. dairy products hampers exports to some extent.

The 2018 cheese, butter, nonfat dry milk (NDM), and whey price forecasts are reduced from the previous month. Cheese is forecast at $1.540-$1.570 per pound, down from $1.605-$1.645 in last month’s report. Butter is forecast at $2.245-$2.305, down from $2.295-$2.365. NDM is lowered to $0.730-$0.760 from $0.775-$0.815, and dry whey is forecast at $0.275-$0.295, down from $0.295-$0.315.

Forecasts also are reduced for cheese, NDM and whey prices for 2019 as cheese stocks will remain large and prices for NDM and whey will have to remain competitive with competing exporters, USDA says.

However, the 2019 butter price forecast is raised to $2.220-$2.350, up a penny from last month’s report, as stocks are expected to be worked down.

The 2018 Class III price forecast is lowered to $14.30-$14.60 per hundredweight, down from $15.05-$15.45 in last month’s report. The 2018 Class IV price forecast is lowered to $13.65-$14.05, down from $14.30-$14.80. The 2018 all-milk price forecast now is $15.95-$16.25, down from $16.60-$17.00

The 2019 Class III price forecast was lowered by 60 cents from a month ago to $14.70-$15.70, and the 2019 Class IV price forecast is lowered by $1.05 to $13.65-$14.75. The 2019 all-milk price forecast is $16.25-$17.25, down from $16.70-$17.70 a month ago.

CMN




NMPF urges focus on food imitation label regulation

July 13, 2018

WASHINGTON — As the use of laboratory-based cell culture technologies to replicate naturally-made foods continues to develop, FDA must first enforce its own existing regulations on the labeling of imitation products, the National Milk Producers Federation (NMPF) said at a hearing Thursday.

The FDA hearing focused on the regulation of cell-cultured products replicating meat. NMPF says these rapidly-evolving technologies impact dairy foods as well. Just as scientists have discovered how to make “meat” imitations look and feel like the real thing, so, too, have they used genetically-modified yeast to produce proteins that share a chemical identity with those found in milk, NMPF says.

FDA has asserted jurisdiction over products manufactured from cell culture technology, but Beth Briczinski, NMPF’s vice president for dairy foods and nutrition, warned that the agency’s failure to enforce existing labeling standards is a major concern.

“For decades, manufacturers have been making fake milk and other imitation dairy beverages and inappropriately using the names of products on their labels that have clear FDA standards of identity,” Briczinski says. “What began as a clever marketing tactic has led to the rampant abuse of legally defined dairy terms, while FDA has looked the other way. Most importantly, it has misled consumers over the nutritional composition of these products in comparison to traditional milk and its contributions to a healthy diet.”

Over the last 20 years, NMPF and its members have made repeated requests for FDA to take enforcement action on misbranded imitation dairy products, with FDA continually claiming the issue is not an agency priority.

“As a result, we now have an ‘anything goes’ attitude in the marketplace,” Briczinski says.

The recent debate over how to regulate and market synthetic meat developed in a lab has brought an added sense of urgency for the dairy industry, NMPF says.

Without a consistent regulatory framework that addresses the marketing of imitation meat and dairy products, in addition to FDA’s selective enforcement, NMPF says it believes labeling abuses by product manufacturers, further consumer confusion and a lack of U.S. compliance with international standards will continue to spread.

Briczinski reiterated the industry’s request that FDA enforce the labeling laws already on the books regarding fake “milks,” stressing that “it’s beyond time to resolve this problem.”

NMPF says it also plans to file written comments with FDA.

In a June 18, 2018, Federal Register notice, FDA requested comments in advance of the meeting on the safety of foods produced using animal cell cultures. FDA specifically requested comments on what considerations should be taken into account when evaluating foods produced by animal cell culture technology, how the technology could have an impact on food safety, how to evaluate the inputs used in this technology and how to assess hazards that may be unique to the production of foods using animal cell culture technology.

Comments are due Sept. 25, 2018.

CMN


U.S. dairy under pressure as additional tariffs imposed

July 6, 2018

WASHINGTON — Tariff threats are becoming reality as the first week in July is underway, with new tariffs from both China and Mexico set to take effect, some of which impact the U.S. dairy and agricultural sectors. The United States also is facing tariff pressure from Canada and the European Union (EU).

Earlier this week, the U.S. Chamber of Commerce released a new analysis outlining the state-by-state impact of retaliatory tariffs from China, the EU, Mexico and Canada, which have been imposed in response to new U.S. tariffs on imported goods. The analysis shows how much of each state’s exports are threatened by retaliatory tariffs, highlights each state’s hardest-hit products and shows the total number of jobs supported by global trade in each state, illustrating what U.S. families and consumers stand to lose in a potential trade war.

“Tariffs are beginning to take a toll on American businesses, workers, farmers and consumers as overseas markets close to American-made products and prices increase here at home,” says Thomas J. Donohue, president and CEO, U.S. Chamber. “Tariffs are simply taxes that raise prices for everyone. Tariffs that beget tariffs that beget more tariffs only lead to a trade war that will cost American jobs and economic growth.”

As of this week, approximately $75 billion worth of U.S. exports will be subject to retaliatory tariffs.
The report highlights a few states that will be particularly harmed by an emerging trade war, including Wisconsin, which is expected to have $1 billion of state exports threatened by retaliatory tariffs, including cheese.

To view the analysis, visit www.uschamber.com/tariffs.

Mexico this week leveled a second round of a two-part process targeting almost $3 billion worth of U.S. goods — $2.5 billion of which are agricultural products including cheese. The first phase of the Mexican duties went into effect June 5 and now is increasing. (Cheese tariffs now will be 20 to 25 percent. For more information, see “Mexico announces codes for cheese tariffs in dispute” in the June 8, 2018, issue of Cheese Market News.)

Stakeholders note the measure impacts most of the cheese shipped from the United States into Mexico.

China also is expected to impose retaliatory tariffs this week on more than 600 products including nearly every dairy product with the exception of lactose, casein and highly concentrated whey proteins.

Meanwhile, Canada is focusing its retaliation mostly on metals but isn’t leaving ag products untouched, notes Dave Salmonsen, trade specialist with the American Farm Bureau Federation (AFBF).

He notes 25 percent retaliatory tariffs on pizza, yogurt, chocolate, orange juice, beer and whiskey are coming from Canada. The EU also is retaliating and, for ag products, they’ve included rice and cranberries, peanut butter, kidney beans and whiskey, subject to 25 percent tariffs, Salmonsen said this week on an AFBF Newsline podcast.

Salmonsen notes that in the near term, for contracts, which potentially have to be executed already, it’s up to the importer to pay the tariff and see how much of it they can pass on in higher prices to consumers.

“In a little longer term, you would think that if we’re not price competitive in those markets, the buyers will try to find product elsewhere, if they can. Those export markets will dry up,” he adds.

Uncertainty also persists on talks on the North American Free Trade Agreement (NAFTA) being renegotiated between the United States, Canada and Mexico. News reports say Chrystia Freeland, Canadian foreign affairs minister, wants NAFTA talks to kick into higher gear this summer, following the recent election of Andrés Manuel López Obrador as the new president of Mexico.

However, President Trump recently indicated he was not happy with the status of a revised NAFTA, and now he is saying he does not want to sign a new agreement until after the midterm elections in November, news reports say.

At the same time, U.S. Trade Representative Robert Lighthizer this week announced that Congress has extended Trade Promotion Authority (TPA) for three more years.

Lighthizer says extension of TPA is critical to negotiating accountable, enforceable and reciprocal trade deals that will benefit American workers, farmers and ranchers.

“The Trump administration is pursuing a number of potential bilateral free trade agreements, and TPA extension means we may continue to aggressively pursue these opportunities,” he says.

CMN


May cheese production up 1.4 percent over year earlier

July 6, 2018

WASHINGTON — Total cheese output in the United States in May, excluding cottage cheese, was 1.09 billion pounds, up 1.4 percent from May 2017’s 1.08 billion pounds and 1.7 percent above April 2018’s 1.07 billion pounds, according to data released Thursday by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Dairy Production chart on page 16.) When adjusting for the length of the months, May cheese production was down 1.6 percent from April on an average daily basis.

Production of Mozzarella totaled 356.3 million pounds in May, up 1.7 percent from May 2017, according to NASS. The most-produced cheese in the United States, Mozzarella is the largest component of the Italian-type cheese category, production of which totaled 457.2 million pounds in May, an increase of 1.1 percent from a year earlier.

Production of Cheddar, the nation’s second most-produced cheese, was 317.5 million pounds in May, down 3.0 percent from May 2017. Production of American-type cheese, of which Cheddar is the largest component, was 442.7 million pounds in May, down 0.1 percent from May 2017.

According to NASS, Gouda production experienced the biggest percentage increase in the May-to-May comparison, climbing 54.3 percent to 6.3 million pounds.

Wisconsin led the nation’s total cheese production, excluding cottage cheese, with 287.5 million pounds in May, up 0.5 percent from its production in May 2017. California followed with 216.8 million pounds, a decrease of 1.3 percent from its production a year earlier.

According to NASS, U.S. butter production in May was 167.9 million pounds, up 2.8 percent from May 2017’s 163.4 million pounds. May butter production was down 4.2 percent from April 2018’s 175.3 million pounds (down 7.3 percent on an average daily basis).

California led the nation’s butter production with 50.7 million pounds in May, up 10.6 percent from its production a year earlier.

NASS reports U.S. production of nonfat dry milk (NDM) was 160.4 million pounds in May, down 4.5 percent from May 2017’s 167.9 million pounds. May NDM production was down 2.1 percent from April’s 163.9 million pounds (down 5.3 percent on an average daily basis).

California led the nation’s NDM production with 48.7 million pounds, a 16.8-percent increase over its production in May 2017.

CMN


OECD-FAO outlook says ag trade key to food security

July 6, 2018

OECD-FAO outlook says ag trade key to food security

PARIS — Global agricultural production is growing steadily across most commodities, reaching record levels in 2017 for most dairy products, cereals, meats and fish, according to an annual report from the Organization for Economic Cooperation and Development (OECD) and the United Nations Food and Agriculture Organization (FAO). The report stresses that agricultural trade plays an important role in promoting food security, underscoring the need for an enabling trade policy environment.

“OECD-FAO Agricultural Outlook 2018-2027” projects weakening growth in global demand for agricultural commodities and food, while anticipating continuing productivity improvements in the sector. As a result, prices of main agricultural commodities are expected to remain low for the coming decade.

The report, presented this week in Paris by OECD Secretary-General Angel Gurría and FAO Director General José Graziano da Silva, attributes the demand slowdown to a deceleration of demand growth in major emerging economies, like China, stagnating per capita consumption of staple foods and a further gradual decline in global population growth rates.

The outlook finds that global agricultural and fish production is projected to grow by around 20 percent over the coming decade but with considerable variation across regions. Strong growth is expected in developing regions with more rapid population growth, including Sub-Saharan Africa, South and East Asia, and the Middle East and North Africa. By contrast, production growth is expected to be much lower in developed countries, especially in Western Europe.

The outlook projects that the weakening of global demand will persist over the coming decade, sapped by declining population growth, flat levels of per capita consumption for staple foods and slowing demand growth for meat products.

With slower consumption and production growth, agricultural and fish trade are projected to grow at about half the rate of the previous decade, the outlook says. Net exports are expected to increase from land-abundant countries and regions, notably the Americas. Countries with high population growth — in particular in the Middle East and North Africa, Sub-Saharan Africa and in Asia — will see rising net imports.

“While overall exports from countries and regions abundant in land are set to increase, many poorer countries with rising populations and limited land resources will be increasingly dependent on food imports to feed their people,” Gurría says. “It will be essential that exporters and importers alike have access to an open and predictable trade policy environment.”

Silva adds that the “Green Revolution” of the last century largely increased the world’s capacity to feed itself but it now needs a sustainability revolution.

“This includes tackling high-input and resource-intensive farming systems that impose a high cost to the environment,” Silva says. “Soil, forests, water, air quality and biodiversity continue to degrade. We need to adopt sustainable and productive food systems that offer healthy and nutritious food, while also preserving the environment and biodiversity.”

The outlook notes that demand for cereals and vegetable oil for the production of biofuels is expected to be largely unchanged over the forecast period, in contrast with the past decade, when biofuels expansion led to more than 120 million metric tons of additional cereal demand, predominantly maize.

With existing policies in developed countries unlikely to support biofuels expansion, most demand growth will come from developing countries that have introduced policies favoring biofuel use. In particular, the use of sugarcane for biofuel production is expected to increase.

This year’s edition of the Agricultural Outlook includes a special chapter on the Middle East and North Africa (MENA), which faces simultaneous issues of food insecurity, rising malnutrition and management of limited natural resources. Undernourishment is concentrated in countries riddled by conflict and political instability, the outlook says. In other countries of the region, food demand is rising fast, due mostly to population growth. Very high consumption levels of wheat together with continually rising sugar and fat consumption are leading to an alarming spread of overweight and obesity in the region.

While the MENA region’s agriculture and fish production is expected to increase by 1.5 percent annually, it will be increasingly challenged by both limited land and water resources and the expected impact of more frequent extreme climate-related events. As a result, import dependence will remain high for most commodities.

The outlook recommends that countries in the region reorient policies away from supporting water-thirsty cereals, and toward greater support for rural development, poverty reduction and farming of higher-value horticulture products.

As a baseline projection, the Agricultural Outlook assumes policies currently in place will continue into the future. Beyond the traditional risks that affect agricultural markets, there are increasing uncertainties with respect to agricultural trade policies and concerns about the possibility of rising protectionism globally.

To download the report, visit www.agri-outlook.org.

CMN


Overall specialty food category continues to grow

July 6, 2018

NEW YORK — Specialty food remains one of the fastest-growing segments of the food business, according to the Specialty Food Association’s (SFA) recently released annual “State of the Specialty Food” industry report.

Fueled by increasing interest from both consumers and retailers, total sales jumped 11 percent between 2015 and 2017, hitting $140.3 billion last year, according to SFA.

Retail dollar sales for specialty foods grew 12.9 percent versus 1.4 percent growth for all food, the organization says, noting product innovation and the wider availability of specialty foods through mass-market outlets is playing a part in the industry’s success.

At retail, the cheese and plant-based cheese category grew at a bit slower pace — 6.6 percent — between 2015-2017 but remains the largest specialty food category at retail with sales of $4.0 billion in 2017. The specialty yogurt and kefir retail category grew by 20.6 percent between 2015-2017 to $2.2 billion in sales in 2017.

Overall specialty food sales through foodservice increased 12.8 percent and online by 21 percent as U.S. consumers make specialty food a regular part of their diets both at home and when dining out, SFA says.

“The specialty food industry is a business that is constantly evolving,” says Phil Kafarakis, president of the Specialty Food Association. “Consumers of all ages are embracing specialty foods and making purchases everywhere they happen to be — from convenience stores to big box retailers to online, as well as in traditional gourmet shops and groceries. Foodservice and retailers are relying more and more upon our products. The industry’s growth has been building and will continue to maintain momentum for years to come. Our research provides a comprehensive picture of where we are today and can be used to help businesses prepare for future success.”

Beginning this year, the Specialty Food Association has refocused its annual research into a single, comprehensive State of the Specialty Food Industry report. Working with Mintel, the report explores where the current market stands, the opportunities and challenges it faces, where it is going based on sales forecasts in key categories, and how the specialty food consumer is evolving.

According to SFA, the top five categories with the highest dollar growth (percent change from 2015-2017) are: water, up 76.1 percent; rice cakes, up 64.1 percent; refrigerated RTD tea and coffee, up 63.2 percent; jerky and meat snacks, up 62.1 percent; and shelf-stable creams and creamers, up 61.7 percent.

SFA says the share of consumers buying specialty foods by generation (2018) are: iGens (age 18-23) 79 percent; Millennials (age 24-41) 67 percent; Gen Xers (age 42-53) 65 percent; and Baby Boomers (age 54-72) 60 percent.

For more information see Specialtyfood.com/stateindustry2018.

CMN


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Today's Cheese Spot Trading
July 20, 2018


Barrels:$1.2700 (-4 1/2)
Blocks: $1.5200 (-1 1/4)


Click here for more market activity
Cheese Production
U.S. Total May
1.092 bil. lbs.


Milk Production
U.S. Total May
19.100 bil. lbs.

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It takes a village for
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Dave Chapman, The Food Connector

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