Dairy Foods presents its 2023 State of the Industry report.
Inflation remains a key dairy trend
Inflation remains a key dairy trend
Dairy Foods presents its 2023 State of the Industry report.
We just can’t wait for the 2024 Olympic Summer Games, scheduled to take place in Paris, France, from July 26 to Aug. 11, 2024, to arrive. So, it’s fitting that when thinking about themes for our annual State of the Industry report, Dairy Foods just had to present a sports theme. In the next several pages of in-depth reporting, find out which dairy categories are scoring touchdowns, which are methodically moving the ball toward the first-down marker, and if any are getting stuffed at the line for a loss.
Like the past year, one major theme affecting the cost of food and beverages is inflation. For the 12 months ending Aug. 13, the consumer price index (CPI) rose 3.7% compared to the prior year. Overall, food CPI ticked up by 4.3% year over year, according to the U.S. Bureau of Labor Statistics. All of these figures are higher than the U.S. Federal Reserve’s goal of inflation rising 2% annually.
Yet, on a positive note, the index for dairy and related products decreased by just 0.4% in August compared to July, which could bode well for inflation cooling in the dairy industry in the coming months. Looking ahead, economists expect overall CPI to rise 2.5% in 2024, much closer to the Federal Reserve’s target, according to both the Survey of Professional Forecasters and a Wall Street Journal survey.
Despite the lower recent inflation figure, dairy was certainly affected by inflation during the past year in many categories. This resulted in dollar sales increasing across many segments, while unit sales dropped for the period ending Aug. 13. Dairy milk, plant-based milk, non-fruit drinks, processed cheese, cream cheese, creams/creamers, margarine/spreads, sour cream, yogurt, ice cream/sherbet and frozen novelties all can be characterized under this umbrella, according to Chicago-based market research firm Circana.
Bucking the trend and enjoying both dollar sales and unit sales growth — a definite positive sign — were natural cheese, butter blends, cottage cheese and whipped toppings, Circana data reveals.
Read on as we examine the milk, cheese, cultured dairy, ice cream/frozen novelties, butter and non-dairy beverages categories in-depth. Dairy Foods’ annual State of the Industry report also provides a full review of both the ingredients and exports’ segments of the dairy industry.
We hope the 2023 State of the Industry report provides plenty of useful information as we get set for the holidays and the upcoming New Year. DF
Export volume could fall for a number of products in 2024, but that is because of a tighter balance in the U.S., while we could see a little stronger exports for other products on improving global demand and better availability in
the U.S.
Consumers are looking for functional, clean-label products with ingredients that bolster immunity and digestive health, improve brain and heart health and prevent diabetes with reduced sugar or zero-added-sugar options. They’re also willing to pay more for added benefits.
Sponsored by IFPC.
Most areas of the non-dairy market are scoring plenty of goals, with the exception of the juice market, which is awaiting its next chance to help the team.
Sponsored by Cargill.
When it comes to butter, sales are serving up plenty of aces, with very few faults. For the first time, refrigerated dollar butter sales topped $4 billion for the 52 weeks ending Aug. 13 in multi-outlets and convenience stores, according to Chicago-based market research firm Circana.
In terms of ice cream and frozen novelty sales, matching a “Super Bowl champion”-level performance like those of the Chiefs’ quarterback Patrick Mahomes in 2020 and 2023, which occurred during the COVID-19 pandemic, when consumers sought a home indulgence, is difficult to replicate.
Sponsored by Berry Global.
Cultured dairy, while not the first female gymnast to win six all-around world titles, is garnering considerable success due to the health and wellness attributes of such key category products as spoonable and drinkable yogurt and cottage cheese.
The cheese category continues to score goals. Natural cheese — and the diverse types of shredded, chunks, slices, string/stick, crumbled, cubes, ricotta, and all other forms — generated $17.4 billion in dollar sales, a year-over-year (YoY) increase of 7%.
Sponsored by Nercon.
The milk category has soured in terms of consumption, but processors are not yet down for the count. Such factors as higher prices and a dynamic shopper base are resulting in declining volume sales.
Sponsored by Krones.
Opening image courtesy of gleitfrosch / iStock / Getty Images Plus.
