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Dairy processors betting on health and wellness for growth

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Refrigerated dairy is the largest category at retail in terms of dollar sales, said Paul Ziemnisky, group executive vice president of science, innovation and business development for Dairy Management Inc., Rosemont, Ill., with “real dairy” being 21-times larger than plant-based alternatives and delivering more growth.

“But there are many untapped opportunities, especially in the health and wellness sector, and dairy can be so much bigger,” he said, when speaking at the Oregon Dairy Industries meeting April 9, 2023, in Salem, Ore. “Health and wellness is the No. 1 area for consumer disposable income spending. It’s valued at $350 billion and includes everything from food to health club memberships.”

DMI is investing to make dairy a bigger part of that health and wellness platform through new product innovation. The farmer-funded association sponsored an online survey of 12,250 adults to identify the top health and wellness benefits consumers are looking for in food and beverage.

“Hydration is the largest need,” Ziemnisky said. “Growth and performance are right up there.”

The research showed consumers are looking for products that help quench thirst, keep them hydrated and are high in electrolytes. They also want the products to be natural, simple and inexpensive.

GoodSport, a Chicago-based startup that had assistance from DMI, developed a clear hydration beverage that is 97% dairy. It delivers three times the electrolytes and 33% less sugar than traditional sports drinks, providing faster and longer-lasting hydration.

With growth and performance, consumers are looking for products that help them build muscle and help their muscles recover after exercise, Ziemnisky said.

“They want sustained energy and to improve athletic performance and endurance,” he said. “Dairy is packed with the nutrients that do all of that and more, such as supporting bone health.”

Another area of focus for health and wellness is weight loss and maintenance. This is especially important for consumers on medications intended to help them lose weight.

“There’s a lot of muscle lost during rapid weight loss,” Ziemnisky said. “These consumers need high-quality, complete protein to preserve their muscle.”

Protality is formulated to support adults interested in pursuing weight loss while maintaining muscle mass and good nutrition. Photo: Abbott

He cited the example of Protality, a new dairy-based, high-protein nutrition shake from Abbott, Abbott Park, Ill. The shelf-stable beverage is formulated to support the growing number of adults interested in pursuing weight loss while maintaining muscle mass and good nutrition.


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“DMI is taking all this research and creating a playbook for the industry to fuel innovation and claims,” Ziemnisky said. “This includes concepts such as a yogurt with a lactoferrin boost to support immunity and a milk beverage enhanced with tryptophan to support restful sleep.”

Oregon State University is one of many research institutes working with DMI to create health and wellness dairy foods and beverages, said Melanie Hanlon, dairy program manager. Some of the current projects include development of a high-protein frozen novelty, a whey-based drinkable yogurt and a ready-to-drink dairy-based alcoholic beverage.

To support startups, DMI recently debuted its “innovate with dairy” online program designed to be a one-stop shop for anyone seeking information about the innovation process. The tool gives entrepreneurs access to more than 250 vetted dairy resources, including researchers and professors who comprise the checkoff-funded Dairy Foods Research Centers network. The tool helps innovators identify concepts that complement the high-growth health and wellness opportunities. It provides knowledge about how to secure investment and everything that is required to bring a product to market.

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