• U.S. CDE ramps up activity

• APFI e-blast kicks off USDEC consumer research series

• MENA report launches new USDEC consumer analysis series

• USDEC meets with port envoy, carriers

• Update on Oakland trucking protests

• U.S. cheeses shine at international competitions

• Member opportunity: USDEC to cover World Cheese Awards entry costs

• Market Summary: Half-year Chinese dairy imports

• Indonesia continues FMD battle

• Company news: Yili, Lactalis, FrieslandCampina

• Dairy processors roll out dairy alternative

 

U.S. CDE ramps up activity with dairy protein and permeate workshop—its largest in-person event to date
In-person activities at the U.S. Center for Dairy Excellence in Singapore continue to ramp up. On the heels of last month’s permeate seminar (see Global Dairy eBrief, 6/10/22), 26 food and beverage product development specialists, R&D scientists and senior managers gathered at USDEC’s U.S. Center for Dairy Excellence (U.S. CDE) in Singapore July 13-15 for a 2.5-day workshop highlighting the innovation potential of U.S. dairy ingredients.

The workshop was not only the largest in-person customer gathering held at the U.S. CDE since its early-pandemic opening but was also the first that brought in attendees from multiple countries throughout Southeast Asia. In addition, it was a perfect example of USDEC leveraging its five-year partnership with Singapore’s Food Innovation and Resource Centre (FIRC).

Workshop participants represented food and beverage companies from Indonesia, Malaysia, the Philippines, Singapore and Thailand, with two additional attendees from academia and another from a Singapore government enterprise agency. Eight USDEC member companies took part in the workshop as well, many as presenters.

Participants in the USDEC Southeast Asia workshop, “Healthful Formulation: Boosting Snacks and Meals with Dairy Proteins and Permeate,” pose in the demo kitchen of the U.S. CDE in Singapore.

Innovation front and center
Over the first two days of the workshop, USDEC Southeast Asia staff and invited speakers gave a series of interactive presentations highlighting the multitude of ways U.S. dairy proteins and permeate could be used to develop a seemingly endless array of every-day foods that align with the dietary habits and preferences of Southeast Asian consumers.

On Day 1, Pauline Chan, director of Singapore-based Food and Nutrition Specialists, outlined how USDEC helped develop 47 Southeast Asian consumer-friendly foods and beverages to help fill protein intake gaps throughout the day. Martin Teo, USDEC Technical Director–Food Applications, Southeast Asia, took the presentation a step further, showing attendees how to select the best-fit U.S. dairy protein based on the application and desired functionality and exploring commercialization potential.

On Day 2, Juzar Kagalwala, director, BASES Business Partner, NielsenIQ Singapore, presented on health and wellness trends in the region and consumer nutritional needs. Kagalwala’s presentation segued into a joint discussion with Anoo Pothen, director-consumer insights at USDEC’s Southeast Asia office, summarizing key learnings from USDEC custom concept testing on protein-enhanced healthy snacks (for more on that research, see APFI item below).

Teo then presented “better-for-you” savory snack prototypes made with U.S. dairy permeate and protein-enriched snacks featuring U.S. dairy proteins, many of which were developed through USDEC’s partnership with FIRC.

On Day 3, the workshop went entirely “hands-on.” Held at FIRC’s Mix and Bake Lab, participants were divided into five groups and given base recipes using dairy proteins and permeate. Each group was instructed to create three formulations using the base recipes and additional ingredients in the lab.

Workshop attendees in the FIRC Mix and Bake Lab about to start their product development challenge using U.S. dairy protein and permeate.

Throughout all three days of the workshop, attendees sampled an array of products to gain a personal understanding of U.S. dairy protein and permeate versatility, properties and innovation potential. Local chef Mohammed Imran prepared three protein-enriched dishes on Day 1. Teo offered the audience prototype samples on Day 2. And participants extensively sampled their own creations at FIRC on Day 3.

“Our aim was to introduce the multi-faceted benefits of U.S. dairy ingredients to inspire food and beverage manufacturers in Southeast Asia to expand product lines with U.S. dairy proteins and permeate and meet consumer needs for healthier products,” said Kristi Saitama, USDEC vice president, Global Ingredients Marketing. “The smiles, energy and enthusiasm of attendees was positive evidence of the workshop’s success.”

APFI ad and e-blast tout U.S. CDE, new consumer research
USDEC highlighted the ramping-up of activity at the U.S. CDE in a full-page ad on the inside front cover of the July/August issue of the trade publication Asia Pacific Food Industry (APFI).

“We’ve missed seeing you during the pandemic and are excited to be opening our doors for in-person meetings and events that create the stage to develop winning products that appeal to local consumer needs,” the ad reads.

It features an image of the U.S. CDE demo kitchen and bullet points of programming activities and opportunities to generate interest and inquiries from current and potential U.S. dairy customers.

E-blast touts consumer research
In conjunction with the ad, USDEC also collaborated with APFI to launch an e-blast this week highlighting the first in a series of customer-friendly research study summaries outlining useful consumer insights for food and beverage manufacturers.

The research aims to gain an outside-in perspective on local-friendly new product concepts developed by USDEC’s Southeast Asia office. Regional food and beverage makers can use it to pinpoint best-prospect ideas and areas for improvement as they work to develop successful products and meaningful consumer messaging.

This initial research, overseen by Anoo Pothen, director-consumer insights at USDEC’s Southeast Asia office, found that products fortified with U.S. dairy proteins hold potential for success in Southeast Asia, particularly when paired with other “healthy” ingredients. It also indicated strong potential for convenience-driven, protein-boosted snacks, including bite-size and on-the-go products.

USDEC encourages members to download and share the two-page research summary with new and existing customers in Southeast Asia.

More to come
Successful collaborations with APFI in 2020 and 2021 yielded significant exposure to Asian dairy ingredient buyers, convincing USDEC to continue the arrangement this year. A feature story on U.S. dairy ingredients is in the works for APFI’s September 2022 issue.

The research e-blast is the latest example of what USDEC expects will be ongoing B:B outreach highlighting the U.S. CDE’s market research capabilities and how the office is working to spotlight U.S. dairy ingredient innovation potential and generate new business for U.S. suppliers.

The next end-user-focused consumer research summary will center on Vietnamese women’s lifestyle and nutritional ambitions before, during and after pregnancy. USDEC expects to complete and release it in August.

MENA report kicks off new USDEC Strategic Insights series
USDEC’s Strategic Insights team released the first installment of a new quarterly consumer market analysis series called “Global Consumer Trends and Insights.” The series will focus on providing concise, easy-to-read synopses of what matters to consumers in key U.S. dairy export target markets and what makes those consumers unique in the world.

“Understanding consumer behavior is foundational to tapping into market opportunities,” said USDEC Market Analyst Scott Lantz.

The first two-page issue focuses on the Middle East and North Africa (MENA) region—specifically on three key markets: the United Arab Emirates, Egypt and the Kingdom of Saudi Arabia. All three offer strong potential for U.S. dairy export growth in cheese and dairy ingredients—dairy proteins and butterfat in particular.

Like consumers across the globe, MENA shoppers are looking for healthier food and beverage options and engaging in sustainability behaviors. However, they also exhibit unique characteristics, including a stronger-than-average appetite for online and mobile buying and heightened price sensitivity—traits the publication explores further.

To download a copy of USDEC’s first Global Consumer Trends and Insights analysis, click here. The third and fourth quarter reports will focus on Mexico and South Korea, respectively.

 

USDEC meets with new port envoy, ocean carriers
As part of ongoing efforts to resolve supply chain problems undermining U.S. dairy exports, USDEC held meetings with the Biden Administration’s new Ports and Supply Chain Envoy, as well as representatives from the ocean carriers Mediterranean Shipping Company (MSC) and Orient Overseas Container Line (OOCL).

Retired Army General Stephen Lyons, former Commander of the U.S. Transportation Command, was announced as the new Port Envoy in May, replacing John Porcari. USDEC’s Krysta Harden and the Trade Policy team met with Lyons to ensure that the needs of U.S. dairy farmers and processors remain a supply chain priority.

USDEC pressed Lyons on a range of critical matters to ensure continued administration support for:

• The Federal Maritime Commission, as it works to implement the Ocean Shipping Reform Act.
  
  
• Reviving the USDA’s Ocean Shipping Container Availability Report.
  
  
• Creating dedicated trucking lanes for perishable foods and agricultural goods so they can enter ports more quickly.
  
  
• Maximizing the ongoing pop-up port facility strategy and expanding it to include inland yards in the Midwest and warehouse-based pop-up facilities near ports.

The meetings with MSC and OOCL were part of a broader effort to identify opportunities to improve relations with carrier lines. Harden and the Trade Policy team engaged with company leaders to outline the export crisis from the perspective of shippers and to explore the possibility of working with the carriers to find better shipping solutions.

Update on Oakland trucking protests
Operations at the Port of Oakland restarted on Monday after a warning from California Governor Gavin Newsom’s office that anyone blocking terminal gates and rail ramps would be “cited and penalized” by police. Truckers had been protesting the implementation of a new California law known as AB5.

Dockworkers who were reluctant to cross the truckers’ picket line last week also reportedly went back to work this week.

The law’s intent is to prevent companies from taking advantage of independent contractors, but in doing so, it would require independent truckers to either seek work as employees or make significant investments and deal with increased red tape to remain independent.

Many truckers say they prefer to remain independent under existing conditions.

Big dairy impact
As noted in the July 25 edition of USDEC’s Leading Indicators email newsletter from the Strategic Insights Team, about one-fifth of all U.S. dairy exports this year moved through the Port of Oakland, including 41% of total U.S. lactose shipments, two-thirds of U.S. WMP exports, and high percentages of U.S. cheese shipments to major markets (44% of U.S. cheese shipments to Japan, a quarter of cheese exports to South Korea and 39% of cheese exports to Australia).

More to come
The legislation was passed in 2019, and the California Trucking Association filed a legal challenge soon afterwards to stop the law. The lawsuit halted implementation until last month, when the U.S. Supreme Court declined to review the case.

The issue, however, is not resolved. The challenge was sent back to the California state court. Governor Newsom said he “wouldn’t bow to protesters.” At press time, protests were continuing at designated areas at the Port of Oakland that do not block the gates. (Wall Street Journal, 725/22; Reuters, 7/23/22; The Loadstar, 7/22/22; Supply Chain Dive, 7/20/22)

U.S. wins 25 gold medals in international cheese competition
U.S. cheesemakers continue to shine on the global stage, and their ongoing ability to compete and win prestigious awards at the international level shows the dedication U.S. suppliers have in crafting high-quality cheeses, while also matching up with competitors from around the world.

Recently, U.S. cheesemakers were well represented (and honored) at the International Cheese and Dairy Awards and the American Cheese Society Judging and Competition.

International Cheese and Dairy Awards 
This year’s competition, held in the United Kingdom in late June, was bigger and more international than ever before, featuring more than 4,000 entries from around the world. USDEC supported entry costs for eight companies and 96 cheeses. 

Consider these numbers:

• 27 U.S. cheesemakers entered more than 300 cheeses in the competition.
  
  
• The U.S. won a total of 70 medals, including 25 gold, 27 silver and 18 bronze.
  
  
• Carr Valley’s Gran Canaria won the trophy for “Best USA Cheese.”

American Cheese Society
Meanwhile, at the American Cheese Society Judging and Competition in Portland last week, more than 1,300 cheeses were entered, demonstrating the breadth of U.S. cheesemaking and the continued growth of the industry.

Among the highlights, Jasper Hill Farms, of Greensboro Bend, Vermont, won “First Place, Best of Show” for its Whitney, Raclette-style cheese and “Third Place, Best of Show” for its Greensward cheese.

USDEC membership also performed extremely well, winning over 50 awards.

Calling all U.S. cheesemakers! World Cheese Awards 2022
Participation in contests like the International Cheese and Dairy Awards Competition and the American Cheese Society Judging and Competition not only builds the U.S. reputation as a top-tier supplier of quality cheeses, but also extends a quality halo across the sector, enhancing the global image of U.S. cheesemakers and the U.S. dairy industry as a whole. Now, USDEC is offering to sponsor U.S. cheesemakers for another major global cheese competition: the upcoming World Cheese Awards (WCA) slated for Nov. 1-2 in Newport, South Wales, UK.

USDEC will support U.S. cheesemakers by covering the WCA entry costs for all U.S. cow’s milk (including mixed-milk) cheeses. USDEC will also provide support in applying for the shipping documentation required to enter the competition. No export capabilities are required to participate.

Since the event organizers are placing a cap on the number of cheeses they will accept, we encourage you to follow the instructions below as soon as possible to enter your cheeses into the competition.

Registration Instructions

1. Login to your MyGuild account (if your company has participated in the WCA before). If you don't have a MyGuild account, please follow these instructions.

2. Once logged into your account, click the “Enter awards” button and follow the on-screen instructions to enter your cheeses into the competition.

3. Once you’ve added all your cheeses and arrive at the payment page, follow the step below that aligns with the cheeses you entered:

If you only entered cheeses made with U.S. cow’s milk (including mixed milk), you have completed your online registration; DO NOT input your payment information. USDEC will be unable to refund companies that process payment for covered cheeses.

If you entered any cheeses that are NOT made with U.S. cow's milk, process payment for only the non-U.S. cow's milk cheeses by selecting them on the page and entering your payment information; USDEC will cover the cost of the U.S. cow's milk cheeses.

4. After you have completed the registration process, please send an email to Ryan Hopkin (rhopkin@usdec.org) with the subject line “WCA - Bill to USDEC.” In the body of the email, please include the following information:

a. Your company name.

b. The number of U.S. cow's milk (including mixed milk) cheeses you entered into the competition.

Once registration closes, USDEC and the WCA will be in contact with further instructions. Please reach out to Karen Price (worldcheese@gff.co.uk) if you experience any issues throughout the registration process.

We look forward to another successful U.S. showing at the 2022 World Cheese Awards!

Half-year Chinese dairy imports down 18.5%
Chinese dairy imports recorded their fourth straight month of double-digit year-over-year declines in June, as volume fell 27% (-54,185 MT). The June decline, however, was different from previous months.

While Chinese purchasing has generally faltered this year (only February posted a gain), import levels every month still exceeded comparable months in 2020. The sharp declines have been attributable in part to China’s extreme buying in 2021 that demolished all previous import records.

That wasn’t the case in June. June imports not only declined vs. the previous year, they also were down 7% (-10,469 MT) compared to June 2020.

Ongoing COVID restrictions and sufficient domestic milk powder stocks continue to slow consumption growth and dampen import demand. In addition, after two straight months of declining domestic milk production in March and April, Chinese milk output climbed 3% in May, further buoying domestic supply.

Through the first six months of 2022, total Chinese dairy import volume (major products, not including fluid) was down 18.5%. On a select product-by-product basis, first-half Chinese import volumes and year-over-year changes were as follows:

• WMP: -6% (-32,423 MT)
• SMP: -25% (-58,345 MT)
• Whey products: -36% (-148,931 MT)
• Cheese: -20% (-19,592 MT)
• Butterfat: -8% (-6,116 MT)
• Lactose +2% (+1,033 MT)

One positive note for June: China’s whey imports continue to recover, albeit slowly. While June volume—54,462 MT—was down 7% vs. the previous year, it was the highest monthly whey import total since September 2021.

Indonesia continues to battle FMD, Australia and New Zealand on guard
As Indonesia struggles to control a devastating outbreak of foot-and-mouth (FMD) disease, other countries in the region—including major dairy exporters New Zealand and Australia—are stepping up measures to guard against FMD.

First detected about two months ago, FMD has spread across Java and Sumatra, Indonesia’s two most populous islands, and infected as many as 400,000 cattle, according to the country’s Disaster Management Agency. More details on the disease and efforts under way to rein it in, including a massive vaccination program, can be found in this “explainer” article.

Meanwhile, Australia and New Zealand, fearing for their own livestock industries, have instituted biosecurity measures, including:

• Australian authorities are checking all mail from China and Indonesia, installing disinfectant foot mats at airports and screening more of the meat products entering the country.
  
  
• Likewise, in New Zealand, disinfectant mats have been placed at airports, baggage is being screened and travelers from Indonesia are not allowed to bring meat products into the country. On Monday, New Zealand urged some travelers returning from Indonesia to stay away from farms for at least a week.

The Australian government has offered to assist Indonesia’s vaccination effort. (USDEC Southeast Asia office; Asia Times; The Associated Press; Sydney Morning Herald, 7/24/22; Reuters, 7/21/22)

Yili opens new powder, butter plants
China’s Yili Group officially opened two new dairy manufacturing plants. A new US$445-million milk powder facility in Hohhot, Inner Mongolia, can produce 60,000 MT per year.

Yili’s New Zealand subsidiary Westland Milk Products unveiled its expanded butter plant in Hokitika on the South Island. The NZ$40-million (about US$25 million) upgrade doubles the plant’s annual consumer and foodservice butter capacity (including small-format butter pats) to 42,000 MT. Westland plans to market the additional butter worldwide. (USDEC China office; Company reports)

FrieslandCampina suspends pasteurized milk business in Thailand; sells Chinese infant formula plant
Dutch dairy giant FrieslandCampina made two significant moves to reorganize its Asian operations.

Citing “intense competition,” the company closed its Foremost pasteurized milk plant in Bangkok. FrieslandCampina said it would instead focus on long-life dairy products for the Thai market, including long-life milk under the Foremost and Falcon brands.

In China, FrieslandCampina sold a production plant in Xiushui to leading Chinese dairy firm Yili Group. The Xiushui facility manufactures infant formula under the Zi Mu brand as well as non-dairy creamers. The company said the sale is part of a decision to focus its Chinese infant formula business on the Friso brand. (USDEC Southeast Asia office; just-food.com, 7/22/22)

Lactalis acquires Italian cheesemaker Ambrosi
French dairy giant Lactalis reportedly purchased Italian cheese specialist Ambrosi, which operates four manufacturing facilities in Italy and subsidiaries in the UK, U.S. and France. Lactalis purchased a 25% stake in Ambrosi from Swiss dairy group Emmi and the remainder from the Ambrosi family, which owned the remaining 75%. Emmi said it sold its share in Ambrosi because classic Italian cheeses no longer align with its core cheese range. (Company reports; EFA News, 7/26/22; European Supermarket Magazine, 7/25/22)

In global trend, dairy processors expand portfolios with plant-based dairy products
Global dairy processors continue to expand their portfolios to reach a broader range of consumers looking to incorporate plant-based products into their diets.

In the first half of 2022, several companies announced developments in the dairy-alternative sector, including industry giants such as Danone, Bel Group, Nestlé and others. Notable themes in this trend include entering new avenues via partnerships, expanding plant-based milk alternatives and dairy-like product lines, and a focus on international growth.

• Bel Group announced a partnership with the fermentation startup Superbrewed Food to develop a line of both dairy and plant-based cheeses with Superbrewed’s Postbiotic Cultured Protein. Bel expects to launch their full range of cheeses to domestic U.S. consumers once Superbrewed supplies the protein from its Delaware facility (expected in 2023).
• In July, Danone launched a new infant formula product, Dairy & Plants Blend, that marries its traditional dairy recipe with added plant-based nutrition for consumers looking for more options that suit vegetarian, flexitarian and plant-based diets. The product contains a blend of 60% plant protein and 40% dairy protein. The first release is scheduled in the Netherlands under the Nutrilon brand, with others to follow later this year under the company’s global Aptamil
• In June, Nestlé introduced a new plant-based drink for toddlers called Little Steps Plantygrow Plant-Based Growing Up Drink. Marketed as part of Nestlé’s SMA Baby line, the product contains proteins from wheat, oat, barley, rye and corn. Plantygrow is the latest in a company-wide dairy-alternative trend. In addition, Nestlé launched two oat-based milk alternatives in China in May: Oh Oat! (a consumer product) and Barista Edition (a product aimed at coffee and tea shops and foodservice venues). The company also expanded distribution of a plant-based version of the chocolate malt beverage Milo (extended to Thailand in April) and the release of 100% oat milk-based coffee capsules in Taiwan in May.
• Netherlands-based FrieslandCampina expanded its portfolio twice this spring. The company launched its first plant-based product made from oats in June. Barista Oat is part of the Friesche Vlag line and targets coffee drinkers. In May, the company announced it was joining forces with De Nieuwe Melkboer (The New Milkman) to develop a local supply chain of plant-based dairy alternatives to bridge the gap between locality and accessibility of plant-based protein.
• Saudi Arabia’s SADAFCO introduced what it claims is the first locally produced oat-based milk alternative. The company says Saudia Oat Milk targets consumers looking to increase their vitamin and fiber intake. SADAFCO previously rolled out a soy-based milk alternative. (USDEC China office; USDEC Middle East/North Africa office; Company reports; Vegconomist, 7/7/22; China Food Press, 5/13/22)

• Training global instructors of USA Cheese Specialist Certification Program
• First major in-person customer-facing interactive event at U.S. Center for Dairy Excellence
• Dairy supports livelihoods and empowers women around the world
• USDEC’s Janice Giddens shares how dairy farming empowers women around the world
• Working to ensure recognition of U.S. dairy’s critical role in food systems of the future