Dairy industry seeks ways to boost school milk sales
COLONIE, N.Y. >> Schools across New York could hold the key to helping struggling dairy farmers survive a lengthy period of extremely low prices for the milk they produce.
Respondents to a recent industry survey said offering more milk flavors and fat content choices would do more to boost sales than any other initiative.
But such efforts require improved marketing, plus educating young people about milk’s nutritional benefits, and overcoming logistical processing and distribution issues that keep dairy products from reaching many school cafeterias.
“Dairy farmers are concerned about school milk because they want to make sure future consumers have a good experience with it,” said Richard C. Naczi, American Dairy Association North East chief executive officer. “About 7.5 percent of milk sold in the U.S. goes into the school market.
“Milk sales are doing well in schools because you’re having more meals served in schools.”
“Our concern is simply to keep up with the times,” he said. “The half-pint milk carton in schools is the same container that’s been there for a long, long time. But because of low margins it’s hard to upgrade that package.
“So we’re trying to find ways to continue to make milk interesting in a world where kids are given lots of choices for the beverages they consume.”
Farmers and a cross-section of industry and state officials discussed such issues during a meeting of the Milk Marketing Advisory Council on Monday, at state agriculture department headquarters in Colonie. The panel is chaired by Andrew Novakovic, Cornell University’s E. V. Baker professor of agricultural economics.
A change from small paper cartons to plastic bottles boosted sales 18percent in a marketing test conducted in about 12 markets around the country, several years ago.
“Kids liked the package better,” Naczi said. “It was more modern like other packages. That half-pint paper container is not what they like to drink milk out of.”
Several firms adopted plastic containers, which are more expensive, but couldn’t continue them because of low dairy industry margins.
Farmers have been plagued by low prices for more than four years, caused by a global oversupply of milk resulting from complicated worldwide market conditions.
CoBar Dairy LLC co-owner Mike Barnes said his farm is currently getting about $16.75 to $17.25 per hundredweight for milk, while the cost of production is $17.50.
New York is the nation’s third leading dairy state behind California and Wisconsin.
“We have an abundance of milk, but I get calls from some school districts that are having a hard time buying New York state milk because of the location of processing facilities and the cost of getting it there,” said Richard Ball, state agriculture commissioner. “Here we have one of the biggest dairy states in the country. We just can’t accept that situation.
“We can look at hauling, processing capacity and just letting people know who’s got what and what the prices are.”
However, a good school milk initiative requires student demand for such products, said
Tonya Van Slyke, executive director of Northeast Dairy Producers Association, an industry advocacy group.
“We need to do a better job educating our high school students about the nutritional importance of dairy products and milk, and how important they can be to the diet,” she said. “We do an excellent job with elementary students by taking them out on farm visits and letting them ask questions of farmers.”
“But then when they get to the junior high and high school level we aren’t doing a lot of education about the nutritious dairy products that are available to young, growing people,” she said.
Novakovic suggested inviting state Education Department officials to a future meeting, to discuss the possibility of making such information part of school curricula.
But he also pointed out that many young people are concerned about the dairy industry’s environmental impacts. To some people, a cup of yogurt represents a good source of calcium. To others, it means harmful methane, a greenhouse gas emitted from cow manure.
“How do we address that if it’s something that prevents someone from grabbing that dairy product?” he said.
“We need to get out in front of that,” Van Slyke said. “We need to talk about the good things we do.”