As we prepare to enter 2023, the U.S. dairy industry continues to outperform against the backdrop of a challenging, volatile global economy. We learned recently from the U.S. Department of Agriculture that per capita consumption of dairy grew by 12.4 pounds per person in 2021. The average American consumed 667 pounds of dairy on a milkfat basis in 2021 versus 539 pounds in 1975.
Times have obviously changed over the past five decades. The dairy industry continues to be shaped and reshaped by constant innovation in response to shifting consumer preferences. As the industry rapidly evolves and transitions, our policies, and priorities must evolve to meet the opportunities of today and tomorrow.
To that end, International Dairy Foods Association (IDFA) is advocating for policies that allow U.S. dairy to become the world’s dominant supplier of nutritious, affordable, and sustainable dairy products. To position our industry to take advantage of these opportunities, we have identified five key objectives that will define 2023 and beyond. They are:
1. Nutrition, Health & Wellness: IDFA is collaborating with industry partners to generate support for new and overlooked research to better inform the Dietary Guidelines for Americans on dairy’s positive impact on human health. We must also strengthen dairy’s role in food security. The SNAP Healthy Fluid Milk Incentives Projects (HFMIP) double the dollars of Supplemental Nutrition Assistance Program participants when they purchase fluid milk at food retail. IDFA has fought to secure $5 million from Congress to date, allowing HFMIP to expand to more than 150 retail outlets in six states in 2023. It is our goal to further expand the program in the next Farm Bill to incorporate other dairy products.
2. Global Competitiveness: Our industry’s goal is to capture more consumers here and abroad. Therefore, we need balanced policies that open global markets and reflect the reality of a domestic marketplace demanding exponentially more cheese, yogurt, butter, and less traditional fluid milk products. At home, IDFA is examining domestic pricing policy to ensure it is reflective of current market conditions as we approach a new Farm Bill.
We are focused on building unity and consensus around policies that are in the long-term best interest of our industry’s growth. To reach more global consumers, we need globally competitive market access through reduced tariffs, competitive prices, and reliable shipping. IDFA will continue advocating for the Biden Administration to articulate a coherent trade policy that advances U.S. dairy.
3. People: Stubborn workforce challenges are impacting output at farms and processing facilities alike. We need an immigration system that works for all sectors of our economy that responds to worsening workforce challenges and treats people fairly and equitably. We are working with a bipartisan group of Congress to advance comprehensive immigration reform. Beyond immigration, we are preparing our IDFA members with new and better ways to attract and retain top talent, plan for leadership succession, and stabilize our workforce through the IDFA People Strategy. The People Strategy offers five initiatives that cover all aspects of workforce.
4. Sustainability: We are pleased to see USDA put billions of dollars toward expanding opportunities for voluntary, incentive-based sustainability practices in the dairy industry. IDFA will work with the industry and USDA to ensure the benefits of these investments are realized throughout the full dairy supply chain. To educate IDFA members on greenhouse gas emissions reporting and accounting standards, we launched an ESG Learning Series in collaboration with PwC. We also conducted a first-of-its-kind survey of IDFA members to gauge how U.S. dairy is progressing on Environmental, Social, and Governance (ESG) issues.
More than 100 IDFA members responded. Among the respondents, 70% reported having a sustainability and/or ESG strategy. Nearly one-third of respondents are classified as Best-in-Class, meaning they have a system in place for reporting Scope I, II, and III GHG metrics. Knowing that U.S. dairy is walking the walk on sustainability, IDFA is engaging U.S. and international policymakers to ensure rules and standards governing GHG emissions incentivize those investing in reductions and do not erect barriers to our business.
5. Technology & Innovation: All these advancements in sustainability and product offerings require technology and innovation. IDFA has developed a stable of experts to share knowledge on the benefits and vulnerabilities of digital transformation and to offer solutions on new ingredients, formulations, and processing technology. We’re equipping businesses to automate while hardening their defenses against cybercrimes. At the same time, we are advocating aggressively to retool FDA’s bureaucracy to allow for greater innovation from food manufacturers to meet consumer demands.
