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Robotics a helpful tool in navigating shortages, crisis

May 22, 2020

By Alyssa Mitchell

MADISON, Wis. — As food manufacturers are facing skill shortages due to retirement, harsh working environments and navigating the global COVID-19 pandemic, robotics in processing and packaging lines are helping to bridge the gap as well as work hand-in-hand with employees.

Packaging and palletizing tasks can present ergonomic challenges for workers due to physical lifting and twisting, says Joe Campbell, senior manager of applications development at Universal Robots (UR), a Denmark-based manufacturer of smaller flexible industrial collaborative robot arms.

The future of robotics is collaborative, Campbell says. According to UR’s research, more than half (60%) of manufacturers say there is a skill shortage, and it makes sense to automate “tedious” jobs.

However, less than 10% of jobs are fully automatable, Campbell says. With palletizing, moving boxes onto pallets can be automated, but workers are still required to move pallets to stretch wrappers and transfer them to the warehouse.

“A worker can supervise four to five robots, ensuring a continuous flow is maintained,” Campbell says.
In addition, collaborative robots increase productivity, he says.

“After adopting collaborative robots, companies typically experience a 50% increase in productivity without job losses,” Campbell says. “As workers are transferred to more value-added locations in a plant, they can make a huge economic impact on the company’s manufacturing capabilities. Meanwhile, the robots can focus on repetitive work.”

The food industry in particular is turning toward robotics more than ever during these unusual times where humans in close interactions are the biggest risk factor in the COVID-19 pandemic, says Sebastien Schmitt, North American Robotics Division manager for Stäubli Corp.

“This was a trend seen before the crisis, but this pandemic has highlighted how robotics can truly resolve many challenges of the food industry both in primary and secondary environments,” Schmitt says.

Olivier Cremoux, business development manager, North America, for Stäubli Corp., adds that in fact COVID-19 acted more as a catalyzer, accelerating a “change of mind “on robotics and implementation of new production processes in the food industry.

“In an industry where you have highly repetitive tasks, tough working environments and high volumes of production, robotics bring a lot of advantages and innovation,” Cremoux says. “The need is clearly identified by main food producers; nevertheless, so far robots have been mostly limited to use in the secondary environment, where food products are already packaged, for case packing or palletizing applications.”

Stäubli more than a decade ago developed the first food-grade 6-axis robot with no protective cover, Cremoux notes.

“We showed that solutions for primary food processing exist,” he says. “Today, we offer a full robotic range that is food grade and compatible with primary environments, including our 4-axis Scara TS2, Fast Picker TP80 and 6-axis TX2. We developed partnerships with specialized machine builders that design food-grade automation cells.”

JLS Automation, York, Pennsylvania, for more than six decades has been meeting dairy and cheese manufacturers’ needs for robotic packaging solutions that offer greater overall productivity, connectivity and flexibility. The company’s robotic packaging solutions cover a wide variety of both primary and secondary cheese packaging applications.

JLS Automation President Craig Souser says the company’s products continue to be in high demand, but since the onset of the COVID-19 crisis there has been increased interest in primary product handling since it typically involves multiple operators in close proximity.

“Clearly, robots themselves cannot get infected, and many of our robots are hit with powerful cleaning agents, anyway,” Souser says. “Robots, properly set up, do not have an issue working closely together, so social distancing is not a concern. Simply put, by definition, robots limit the required human operators needed to support a given packaging line, so it takes workers out of an environment that might have put them at risk and mitigates the possibility of an operator with any illness, especially COVID-19, of infecting others.

“Many of our customers are running more shifts than normal, and with sanitary robots in place, they don’t need to go find as many hard-to-acquire human workers,” he adds.

JLS Automation also has a service/support tool, JLS View, based on the Microsoft HoloLens that the company is using for remotely servicing equipment.

“It is Augmented Reality, so it gets our technician to the machine virtually and we can help the customer as if we are there in the plant,” Souser says.

Campbell notes that research done by the Massachusetts Institute of Technology in 2016 found that human-robot collaboration is 85% more productive than humans or robots working alone.

“With flexible palletizing solutions, workers move pallets, supervise robots and deal with any faults that arise,” Campbell says. “They keep the robots constantly working, which makes the entire line more productive.”

He notes other benefits of robotics include safety, flexibility, cost efficiency and easy programming.

“Universal Robots’ collaborative robots are continually updated based on regulations,” Campbell adds. “As a result, the robots are well-equipped for today’s realities.”

Schmitt notes Stäubli is seeing more interest than ever for robotic solutions from food companies in North America.

“The ones that were already using our solutions are comforted that it was a good investment — it definitely is helping them through this crisis — and the companies that do not have automation yet are definitely more keen to invest in it,” he says.

The food industry is relatively new to robotics and has a smaller knowledge of it than other industries, such as automotive or pharmaceutical, Schmitt adds.

“This is why we take a different approach than most of our competitors. Stäubli does not use distributors and approaches each project with direct exchanges with food customers to understand their exact needs and requirements to find the best fit among our broad offerings. We have technical support available all over North America and a 24/7 hotline for our customers,” he says.

Cremoux adds that with many food production plants being forced to close over the last month due to COVID-19, the use of automation allows for safer, consistent production to supply food to the population.

“Robotics maintain a consistent level of labor, avoid turnover and allow companies to maintain the quality of the production process,” he says.

CMN


USDA announces details of farmer assistance through CFAP

May 22, 2020

WASHINGTON — U.S. Secretary of Agriculture Sonny Perdue this week announced details of the Coronavirus Food Assistance Program (CFAP), which will provide up to $16 billion in direct payments to deliver relief to America’s farmers and ranchers impacted by the coronavirus pandemic. In addition to this direct support to farmers and ranchers, USDA’s Farmers to Families Food Box program is partnering with regional and local distributors — whose workforces have been significantly impacted by the closure of many restaurants, hotels and other foodservice entities — to purchase $3 billion in fresh dairy, produce and meat and deliver boxes to Americans in need.

“These payments will help keep farmers afloat while market demand returns as our nation reopens and recovers. America’s farmers are resilient and will get through this challenge just like they always do with faith, hard work and determination,” Perdue says.

Beginning May 26, USDA, through the Farm Service Agency (FSA), will be accepting applications from agricultural producers who have suffered losses. Applications will be accepted through Aug. 28, 2020

CFAP provides financial assistance to producers of agricultural commodities who have suffered a 5% or greater price decline due to COVID-19 and face additional significant marketing costs as a result of lower demand, surplus production, and disruptions to shipping patterns and the orderly marketing of commodities.

Farmers and ranchers will receive direct support, drawn from two possible funding sources. The first source of funding is $9.5 billion in appropriated funding provided in the Coronavirus Aid, Relief and Economic Stability (CARES) Act to compensate farmers for losses due to price declines that occurred between mid-January 2020 and mid-April 2020. The second funding source uses the Commodity Credit Corp. Charter Act to compensate producers for $6.5 billion in losses due to ongoing market disruptions.

For dairy, the total payment will be calculated based on a producer’s certification of milk production for the first quarter of calendar year 2020 multiplied by a national price decline during the same quarter. The second part of the payment is based a national adjustment to each producer’s production in the first quarter.

There is a payment limitation of $250,000 per person or entity for all commodities combined. Applicants who are corporations, limited liability companies or limited partnerships may qualify for additional payment limits where members actively provide personal labor or personal management for the farming operation. Producers also will have to certify they meet the Adjusted Gross Income limitation of $900,000 unless 75% or more of their income is derived from farming, ranching or forestry-related activities.

To ensure the availability of funding throughout the application period, producers will receive 80% of their maximum total payment upon approval of the application. The remaining portion of the payment, not to exceed the payment limit, will be paid at a later date as funds remain available, USDA says.

The National Milk Producers Federation (NMPF) thanked President Trump and Perdue for supporting dairy in USDA’s $16 billion agriculture payments plan. However, NMPF notes current aid levels still will be insufficient to meet the needs of milk producers and other agricultural sectors facing massive disruption from the coronavirus crisis.

NMPF says it will continue to work with administration officials and members of Congress to achieve adequate aid for all dairy producers, whose projected losses of $8.2 billion, based on USDA data, place them among the hardest-hit U.S. agricultural commodities.

“We welcome this federal dairy assistance, which is critically needed as the nation’s dairy farmers face an unprecedented market collapse,” says Jim Mulhern, president and CEO, NMPF. “USDA’s plan will provide relief to many farmers, and we appreciate the department’s adjustments to payment limits, an issue which we raised prior to the department finalizing this package.

“Even so, we believe more flexibility in payment limits and some changes to payment calculations will be needed in future rounds of funding to meet the unprecedented challenges faced by producers of all sizes, in dairy and throughout agriculture,” Mulhern adds. “We look forward to working with federal officials and lawmakers on additional assistance.”

FarmFirst Dairy Cooperative also commended Perdue and the USDA on their direct payment plan under CFAP.

“FarmFirst has been advocating that funds need to be made available for farmers quickly, so we commend the USDA for making these plans as direct payments to producers as well as receiving 80% of the funds within a week of signing up for the program,” says John Rettler, a dairy farmer in Neosho, Wisconsin, and president of FarmFirst. “As it was described during President Trump’s press conference, farmers are the very first link in the food supply chain. Supporting U.S. farmers ultimately supports the entire food chain.”

Rettler adds that FarmFirst strongly encourages USDA to consider additional funding support for dairy farmers, as the industry as a whole has experienced a delayed affect on feeling the impact of the pandemic on dairy market prices.

“Quite frankly, the USDA’s current plan to pay only 30% of dairy’s projected losses since April 15 falls far too short of the support that dairy farmers need to stay in business, considering that much of dairy’s losses will be reflected in milk checks paid after April 15,” Rettler says. “Dairy never stops and has not stopped during this pandemic, but U.S. dairy producers will need a higher level of support to manage through this.”

For more information on CFAP and to apply, visit www.farmers.gov/cfap.

CMN


U.S. milk production in April rises 1.4% from a year earlier

May 22, 2020

WASHINGTON — Milk production in the 24 major milk-producing states in April totaled 17.83 billion pounds, up 1.6% from April 2019, according to data released this week by USDA’s National Agricultural Statistics Service (NASS). For the entire United States, April milk production was estimated at 18.70 billion pounds, up 1.4% from April 2019. (All figures are rounded. Please see CMN’s Milk Production chart.)

March revised production for the 24 major states totaled 18.46 billion pounds, an increase of 115 million pounds or 0.6% from last month’s preliminary production estimate.

April production per cow in the 24 major states averaged 2,013 pounds, 17 pounds above April 2019 but down 71 pounds from a month earlier. For the entire United States, production per cow in April is estimated at 1,993 pounds, 18 pounds higher than April of last year but down 71 pounds from a month earlier.

NASS reports the number of milk cows on farms in the 24 major states was 8.85 million head in April, up 65,000 head from April 2019 but down 4,000 head from the previous month. In the entire United States, there were an estimated 9.38 million milk cows in April, 49,000 cows more than a year earlier but 4,000 cows less than March.

California led the nation’s milk production in April with 3.50 billion pounds of milk, up 0.3% from a year earlier. Wisconsin followed with 2.54 billion pounds of milk produced in April, up less than 0.1% from April 2019.

CMN



Demand for Brick and Muenster grows with new trends, products in foodservice, retail

MADISON, Wis. — Brick and Muenster, established and reliable workhorses in American kitchens, may not get as much attention as popular Mozzarella or new and emerging specialty cheeses. But both have seen growth thanks to their approachability as well as recent foodservice trends.

“There’s kind of an appeal with both the flavor profile and texture that really doesn’t ever turn anyone off. Little kids to adults, I’ve never heard anyone say they don’t like those cheeses, unless it’s someone who doesn’t really like cheese,” says Luke Buholzer, vice president of sales for Klondike Cheese, Monroe, Wisconsin.

“They’re super, super versatile. Both slice very well. For sandwiches, presliced or in the deli, they perform fantastically. A lot of people use them as a table cheese,” Buholzer adds. “A lot of pizzerias use them in cheese blends for pizzas. We see a lot of restaurants, when moving up a notch from processed or wanting something a little different from Cheddar in a hamburger or sandwich, will use these cheeses.”

In retail sales, Muenster has seen consistent year-on-year volume growth since 2016, according to IRI data courtesy of Dairy Management Inc. (DMI). Brick showed above-average growth in 2019, though this category had declined over the three previous years. Both categories have had double-digit growth year-to-date in 2020 compared to the previous year, though DMI notes that this year’s numbers have been significantly impacted by coronavirus-inspired buying trends. In 2019, Muenster accounted for less than 0.8% of total natural cheese volume sold, while Brick cheese accounted for 0.001%, IRI reports.

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ADPI webinar series looks at surviving, thriving in crisis

May 15, 2020

By Rena Archwamety

MADISON, Wis. — During times of crisis, including the current challenges dairy businesses face with COVID-19, companies can find ways not only to survive but also to thrive and implement innovative improvements for the long term, according to speaker Shawn Rhodes who led a special webinar on “Thriving During a Business Crisis” hosted last week by the American Dairy Products Institute (ADPI).

Rhodes, president and founder of Shoshin Consulting, will be the keynote speaker at ADPI’s Virtual Annual Conference with the American Butter Institute July 27-31. He presented the first part of the special webinar series, “Surviving During Business Crisis,” April 23 (see “ADPI keynote offers advice on dairy survival during pandemic” in the May 1, 2020, issue of Cheese Market News).

Building on themes of pivoting during a crisis that he discussed in the previous webinar, in his May 7 presentation, Rhodes talked about proactive strategies companies can take to maximize profitability and innovation while operating under current challenges.
“We can either pivot like we’ve been forced to pivot, or we can choose to pivot,” Rhodes says. “For those of us returning to business, how do we ramp up in ways that are different from pre-COVID, or better?

He notes that in a recent survey of more than 2,800 businesses in 28 industries, one-third said they had to lay off at least 75% of their staff. Companies have been forced to learn how to do more with less, while customers expect them to be more effective than before, he says.

“The fact that our customers have more expectations of us — higher expectations — puts us in an interesting place,” he says. “Customers now are dealing with the pandemic as well.”

For dairy companies, Rhodes says employees that remain on the job are now more important than ever. Documentation requirements will only expand in areas of standard compliance such as monitoring employee health and enforcing distancing requirements, which businesses can view as an opportunity to improve safety and performance. Businesses also should expect finances to be in a fluid state for some time as supply chains slowly return to normal, he adds.

Business owners must adopt the philosophy that their choices, which will determine success or failure, still are under their control, and begin to engage all of their employees in being innovators, Rhodes says. This way they can achieve profitability through innovation.

He encourages businesses to adopt the “Rule of 5,” a process he recommends when consulting clients from Fortune 500 companies to sole entrepreneurships. When meeting with their senior management or supervisor teams, he says owners should ask them to bring five challenges encountered during the week and work on implementing solutions. For larger companies, employees can report these problems to mid-level managers or supervisors who can determine which problems most affect profitability and then float the top two or three up to the senior management team to begin implementing solutions.

This “Rule of 5” process helps make everyone in the company an innovator, Rhodes explains. However, he notes that identifying the problem and solution is only half the task. Processes also must be in place to see that changes are implemented, executed and tracked.

“When we talk about innovation, it’s not a one-person job — it’s an every-person job,” he says. “If everyone is bringing great ideas, it’s not just one person responsible for implementing them.”

Rhodes suggests an innovation template to identify both internal and external problems and implement new processes, which includes answering the following questions:

• What happened?

• What did we learn?

• Who’s responsible for making this change?

• What specific process are we improving?

• When will it be updated by?

He notes that companies can look beyond just surviving COVID-19 and focus on what they can do to be more efficient and innovative moving into the future.

“It’s a silver lining, a blessing in the midst of crisis,” Rhodes says.

On an external level, he notes that in times like this, companies cannot over-communicate with their customers. They should communicate what they’re doing for employee safety, what they’re doing to ensure continued quality and be honest about any logistical issues.

In a graph, Rhodes demonstrates how the “Rule of 5” can build consistent small changes into compounding success. Based on 5% compounding improvement each week, a company will see 1,200% performance improvement over the span of a year, with most improvement realized in the final quarter.

“It’s not just a mathematical equation — this has been seen and replicated inside organizations as applied to profitability,” Rhodes says. “It’s mathematical proof, if you change five small things a week, the changes compound on each other.”


USDA announces dairy awards under new food box program

May 15, 2020

WASHINGTON —USDA last Friday approved $1.2 billion in contracts through its new Farmers to Families Food Box Program, including $317 million for a variety of dairy products and $175 million for combination boxes of dairy, fresh produce or meat products.

The program originally was announced April 17, stating that an estimated $100 million per month in dairy products would be purchased (along with $100 million in fresh fruits/vegetables and $100 million in meat products) until a $3 billion budget was exhausted. Potential suppliers originally were given a May 1 bid deadline.

However, USDA surprised market participants last Friday as they awarded more than double their initial estimate of dairy funds for the Food Box program within a tight delivery window (May 15 through June 30).

“Innovative solutions are demanded in these unprecedented times, and I applaud USDA for its actions to provide nutritious dairy products to families in need,” says Jim Mulhern, president and CEO of the National Milk Producers Federation.

“The International Dairy Foods Association (IDFA) applauds USDA for moving quickly, aggressively and creatively to formulate the Farmers to Families Food Box program. Not only will this effort purchase roughly $3 billion in food from American producers and processors and get it to people in need across our country, but the program also will establish a new paradigm for building partnerships among the public, private and nonprofit sectors to respond to food insecurity,” adds Michael Dykes, president and CEO, IDFA.

Dykes notes based on what IDFA is hearing from its members who have been notified of winning proposals, USDA has embraced businesses of all sizes and from all across the country.

“Our hope is that these purchases, alongside traditional Section 32 and entitlement program purchases, spur demand for additional dairy products and thereby keep the dairy supply intact throughout this crisis,” he says.
USDA says it may elect to extend the period of performance of the contracts, via option periods, dependent upon program success and available remaining funds, up to $3 billion.

Stakeholders note fluid is the biggest beneficiary within the dairy category, with more than $187 million (59%) allocated to bottled milk. The rest of the dollars will be used to buy cheese, butter, yogurt and other dairy goods.

USDA last Friday also issued two separate requests for proposals for fluid milk purchases, with submissions due May 22. One solicitation directs deliveries to Idaho, Massachusetts, Montana, Vermont and Washington, while the other directs deliveries to 24 states, including all of the Midwest.

The knee-jerk reaction by the market to USDA’s announcement has been bullish, says HighGround Dairy, Chicago.

HighGround says its estimates of cheese and butter purchases within the program represent a small portion of total demand and do not come close to making up for lost sales as restaurants remain well below pre-COVID levels.

“We believe that 33 million jobs lost (and counting) as well as a slow, methodical return to normal, especially in major urban/suburban centers, will remain a drag on dairy product consumption as it did during the 2008/09 dairy recession,” HighGround says, noting dairy farmers have heeded the call to reduce milk supply but will quickly ramp back up when asked. If government bids are not sustained, it could prolong the period of below-average milk prices, HighGround adds.

“Government intervention rarely works as a long-term solution. Dairy farmers are urged to look closely at a heavily inflated futures market relative to cash prices and find ways to add or build coverage,” HighGround says.

In a “Special Analysis” released earlier this week, INTL FCStone, Chicago, says: “If you make a few assumptions about the types of products they will be buying and the cost per pound, we could see the U.S. government buy an extra 270-plus million pounds of cheese, 50 million pounds of butter and 1.4-plus billion pounds of fluid milk. These purchases won’t fully offset the decline in foodservice sales for May, but if we assume foodservice sales continue to improve, and if the government purchases keep ramping up into July and August, we could get dairy prices back to pre-COVID levels a lot faster than we were previously thinking.”

Other dairy groups including the Dairy Business Association (DBA), Edge Dairy Farmer Cooperative and FarmFirst Dairy Cooperative also praised USDA’s announcement.

“Our dairy farmers and processors are pleased to see the USDA getting dairy products to those who have suddenly found themselves without enough food for their families,” say DBA and Edge in a joint statement. “This action also helps offset the collapse of the foodservice market by redirecting the milk, cheese, butter and yogurt that typically goes to schools and restaurants to the surging food aid efforts. People in need will benefit and our farmers will benefit.”

John Rettler, a dairy farmer from Neosho, Wisconsin, and president of FarmFirst Dairy Cooperative, says dairy farmers are looking for real marketplace solutions to ensure that dairy products continue to get to those who need them, and this program helps accomplish that.

“We are grateful for the USDA and Secretary Perdue on their swift effort on getting this in motion. Time is of the essence as dairy farmers contemplate how they can keep their operations going, knowing that their milk checks are falling far short of the bills they have to pay.”

For the full list of approved contractors, visit www.ams.usda.gov/sites/default/files/media/Announcementof ContractAwards.pdf.

CMN


USDA increases forecasts for milk production, cheese price

May 15, 2020

WASHINGTON — In its latest World Agricultural Supply and Demand Estimates (WASDE) report released Tuesday, USDA increased its milk production forecast for 2020, compared to last month, as well as its milk production forecast for 2021 compared to 2020.

Milk production now is forecast to total 222.4 billion pounds in 2020, up from 222.2 billion pounds forecast last month. For 2021, milk production is forecast to reach 224.1 billion pounds on stronger expected growth in milk per cow despite a slightly smaller dairy cow herd, USDA says.

Commercial exports on a fat basis are forecast to reach 9.2 billion pounds in 2020, up from last month’s forecast of 8.9 billion pounds. For 2021, fat-basis exports also are forecast at 9.2 billion pounds.

The skim-solids basis export forecast for 2020 also is forecast higher than last month at 44.4 billion pounds, up from 42.1 billion pounds, while 2021 skim-solids exports are forecast to reach 44.9 billion pounds on relatively firm demand, USDA says.

Imports on both a fat and skim-solid basis are forecast up 100 million pounds from last month for 2020 to 6.7 billion and 5.7 billion pounds, respectively, in this month’s report, while both are forecast another 100 million pounds higher in 2021 at 6.8 billion and 5.8 billion pounds, respectively.

USDA this month forecasts higher 2020 prices for cheese and dry whey compared to last month, at $1.420 per pound and $0.380 per pound, respectively.

Butter and nonfat dry milk (NDM) prices for 2020 are forecast lower this month at $1.410 per pound and $0.940 per pound, respectively. Class III and all milk prices for 2020 are forecast higher this month, at $13.35 per hundredweight and $14.55 per hundredweight, respectively, while the 2020 Class IV price is forecast lower this month at $11.90, USDA says.

With improved domestic and export demand, all dairy product prices are forecast higher in 2021, USDA says. Cheese is forecast at $1.495 per pound, while butter is forecast at $1.465 per pound. NDM is forecast at $0.955 per pound, while dry whey is forecast at $0.395.

In 2021, Class III and IV milk prices are forecast at $14.20 and $12.20 per hundredweight, respectively, while the all milk price is forecast at $15.00, USDA says.

CMN


Pandemic leads to demand for cheese staples, e-commerce

May 8, 2020

By Trina La Susa

MADISON, Wis. — During the coronavirus pandemic, cheese companies are facing greater consumer demand for staple cheeses used in cooking and snacking as well as demand for getting more product into the hands of consumers through means of e-commerce, pickups, dropoffs and deliveries.

New consumption patterns are emerging quickly due to the impact of the coronavirus, according to IRI data. Consumers currently are cutting back on in-store shopping trips by stocking up on kitchen staples for eating at home, placing large online orders for staple food items, using delivery services more frequently and adopting contactless payment methods.

After experiencing a significant stock-up period across the market in mid-March, food sales continue to remain steady as in-home consumption increases due to state-specific mandates to “shelter in place.” In the United States, the week ending April 19 saw a 14.6% growth in dairy purchases compared to one year ago, with natural cheese ranking as one of the top subcategories, according to IRI and BCG’s Covid-19 Impact Report.

“Looking at the two largest dairy categories, milk and natural cheese, we see positive sales based on total U.S. multi-outlets with convenience,” says John Crawford, vice president, client insights-dairy, IRI.

Dairy has seen double-digit sales gains over comparable weeks in 2019 for about six weeks in a row. Crawford notes milk sales have been up $45 million and natural cheese sales have been up $85 million during the shelter-at-home orders for the period of March 29 through April 19, versus the period ending March 8. Year-to-date, milk is up 8.7% and natural cheese is up 15.3% versus a year ago, he adds.

While sales have been steady, the dairy industry has faced challenges with excess unprocessed milk due to steep foodservice declines as restaurants, schools and coffee shops have closed. Staffing also poses a challenge with the unemployment rate passing 20% with 4.4 million weekly claims as of April 23, Crawford says.

• Online cheese sales grow

“The cheese and dairy business has been hit hard across the country,” says Jill Giacomini Basch, co-owner and chief marketing officer, Point Reyes Farmstead Cheese Co. “There is a surplus of fresh cheeses, highly perishable cheeses, ultra-specialty cheeses often showcased on restaurant menus, and a glut of fluid milk.”

At Point Reyes Farmstead Cheese, an artisanal cheese company in Point Reyes Station, California, online sales are very strong, according to Giacomini Basch. In an effort to make its individual cheeses and gift packs more accessible, she says Point Reyes Farmstead Cheese started covering all shipping fees for FedEx 2Day delivery in April.

“We have extended the free shipping promotion through May 31, knowing that many of our customers are preferring direct-door delivery right now,” she says. “We want to do what we can to keep our cheese accessible to them.”

Additionally, distribution to retail across the country has been good and steady, according to Giacomini Basch.

“We haven’t seen the surges that commodity cheesemakers have seen, but the demand for our products has been consistent,” she says. “Our retailers have been very supportive of our products and especially interested in our pre-cut and wrapped options, which include Original Blue, Bay Blue, Toma and the new Toma flavors: TomaProvence, TomaRashi and TomaTruffle.”

To help bolster sales, Point Reyes Farmstead Cheese is supporting its retailers by building brand awareness with education and usage ideas online. Giacomini Basch says the response on social media to its recipe videos, virtual farm tour series and online cheese tastings has been fantastic. The content Point Reyes Farmstead Cheese has posted has proven valuable to
cheesemongers wanting to enhance their knowledge of the cheese company’s farming practices as well as culinary applications.

“The cheeses that are selling most are the staple cheeses, the workhorses in the kitchen,” Giacomini Basch says. “For us that is Original Blue and Toma. These cheeses are great for snacking and presenting on cheese boards, but they’re also super functional in recipes and have become mainstays in consumers’ favorite recipes. Our customers are committed in keeping them stocked in their kitchens at all times.”

•Shifting sales, marketing strategy

Whisps Snacks in New York City, which provides shelf-stable, 100% cheese crisps made from exclusively crafted artisanal cheese blends, has shifted its strategy to “meet cheese lovers where they shop” by enhancing and expanding its digital shelf across key online retailers and grocery delivery platforms like Instacart, says Ilana Fischer, CEO, Whisps.

“COVID-19 has put much of our industry on the front lines, from grocery store cashiers to manufacturers and distributors,” Fischer says. “We have shifted our field sales and marketing efforts to thank these courageous partners, and so far, we’ve committed over half-a-million Whisps samples to hospitals and grocery stores as our small part in thanking them.”

Fischer says consumers are cutting back on shopping trips, increasing basket size and shifting to online deliveries or pick up. Within better-for-you snacking, consumer demand is shifting to shelf-stable snacks in larger bag sizes.

“Consumers are going to stores less often so they are looking to extend the life of their pantry past what a fresh food or snack expiration date typically offers,” Fischer says. “Choosing to have Whisps in their pantry means they can free up fridge or freezer space and always have delicious cheese on hand for both snacking or recipe creations.”

Better-for-you snacking is experiencing an increased demand for family-size bags, and to meet this demand, Whisps is introducing larger format options for grocery, Fischer adds.

“Our supply chain has to be extremely sharp in watching demand, trends, market factors and planning accordingly. We maintain very close relationships with our four U.S. dairy farmers and feel fortunate to have suppliers that can keep up with our demand while remaining financially stable due to our long-term contracts,” Fischer says.

• Cheese delivered at doorsteps

Another cheese company’s shift in strategy began as a charitable endeavor to help improve food access during COVID-19 and has grown to become part of its business model. Brent Delman, cheesemaker and owner of “The Cheese Guy” in Yonkers, New York, says in mid-March he started handdelivering customizable boxes of his specialty cheeses and other products to help those in New Rochelle, New York, who were unable to leave their homes during the coronavirus outbreak. The Cheese Guy’s delivery service began as a free delivery service and has now expanded to serve other areas of New York for a small delivery fee.

“We were probably one of the first to make cheese deliveries to the town of New Rochelle, which was really the epicenter of where New York had so many of the coronavirus cases,” Delman says. “Gov. Cuomo sent the National Guard there because they were monitoring who was coming in and out of the city due to high concentration of active COVID-19 cases. I was one of the first home delivery people to go in.”

The Cheese Guy collaborates with local farms to create cheeses that are all natural, kosher, vegetarian and small-batch. Additionally, the company has refrigerated trucks for wholesale distribution.

Now Delman’s cheese business, which is normally geared toward wholesale distribution, retailers and farmers markets, also is growing its personalized doorstep hand deliveries, organizing drop-offs at apartments and condos, and increasing its online sales. Product is still going to retail chain stores that remain open, such as Whole Foods, but the company has scaled back to sending out one truck daily, he adds.

“There are fewer people perusing stores, so the focus is on orders to go or delivery orders, and people are really sticking to what they are most comfortable with, which tends to be a lot of the staples — in our case, more Cheddars and Parmesans. We have grated and shredded Parmesan in a cup, and some of these convenience items are doing extremely well,” Delman says.

“We’ve also seen a bump in demand for some of our organic and raw milk varieties, including a raw milk Cheddar and organic Jack cheese. People seem to be more health conscious during the current situation,” he adds.

Delman says in the retail market, several New York stores have closed their fresh cut-and-wrap programs where the company used to supply foodservice sizes or large blocks and wheels. He says retail level behaviors are changing, as customers are choosing pre-packed cheeses rather than those cut fresh at the deli counter.

“Normally, this time of year we start to get involved with farmers markets, so we’ve collaborated with some of the farmers market managers and organizers to get some of the email lists of customers from farmers markets to offer them a drop-off delivery option with a central pick up point,” Delman says.

“We’ve also had relationships with some of the boards of high-rise apartments and condominiums. They’ll send out a mass email, and we’ll have a specific date or day of the week to make one drop-off of multiple orders for the building, leaving it downstairs for the doorman. The doorman notifies all residents that their deliveries have arrived for them downstairs, then they pick it up and use contactless payment through either Vemno, Paypal and Square,” he adds.

Additionally, BlockandWedge.com, a third party, e-commerce site based in Ohio, is offering The Cheese Guy’s products online. Delman says over the last few weeks since the pandemic began, the e-commerce site has been overwhelmed with nationwide orders for his cheeses.

“From an injured oyster comes a pearl,” Delman says. “I think that we can use this as a time to experiment with new and different things, whether it’s making a different type of a cheese or new partnerships.”

CMN


USDA to purchase more dairy; stakeholders tout loan program

May 8, 2020

WASHINGTON — U.S. Secretary of Agriculture Sonny Perdue this week announced details of $470 million in Section 32 food purchases that will occur in the third quarter of fiscal year 2020, in addition to purchases previously announced, which will enable USDA to purchase surplus food for distribution to communities nationwide. These Section 32 purchases will provide additional support for producers and Americans in need in response to changing market conditions caused by the COVID-19 national emergency, USDA says.

“President Trump has authorized USDA to support our farmers affected by this national emergency, and this action to purchase food and deliver to those in need further demonstrates his unwavering support for the American people during these unprecedented times,” Perdue says. “America’s farmers and ranchers have experienced a dislocated supply chain caused by the coronavirus. USDA is in the unique position to purchase these foods and deliver them to the hungry Americans who need it most.”

USDA’s Agricultural Marketing Service (AMS) will purchase a wide variety of dairy, fruits, vegetables, meat and seafood products. USDA says it will purchase $120 million worth of dairy products.

Purchases are determined by industry requests, market analysis and food bank needs. AMS will begin issuing solicitations in June and intends to begin deliveries in July. Details on how vendors may participate are available on the Selling Food to USDA page on the AMS website at www.ams.usda.gov/selling-food. Once available, solicitations will be posted to the AMS Open Purchases Request website, www.ams.usda.gov/open-purchase-request/Poultry%2C_Grades_&_Procurement_of. Industry requests for future purchases using Section 32 funds, including potential plans for the fourth quarter of fiscal year 2020, will be assessed on an ongoing basis, USDA says.

In addition to Section 32 purchases, USDA will use other available funds to purchase food in support of American agriculture and families on an ongoing basis and in response to recent disruptions in food supply chains, the agency says. Using these available funds, USDA plans to purchase 100% American-grown and produced agricultural products totaling $4.89 billion for the remainder of this fiscal year.

The National Milk Producers Federation (NMPF) expressed appreciation to Perdue and USDA for including $120 million of cheese and butter among the $470 million in Section 32 food purchases.

“These Section 32 purchases will help both Americans who need high-quality nutritious food as well as U.S. dairy farmers who are experiencing unprecedented losses from the COVID-19 national emergency,” says Jim Mulhern, president and CEO, NMPF. “The purchases will provide important and needed support to the dairy supply chain. We look forward to learning more details and to continue working with USDA on possible additional purchases.”

Meanwhile, a large group of dairy companies and organizations including the International Dairy Foods Association, California Dairies Inc., Great Lakes Cheese Co., Land O’Lakes and more earlier this week in a letter to Congress urged lawmakers to include a dairy recourse loan program in the next COVID-19 response package.

“As a result of the COVID-19 crisis, the foodservice industry has collapsed, creating an estimated 10% destruction in dairy product demand,” the stakeholders write. “This has resulted in a major upheaval in the dairy industry as processors, marketers and merchants adapt to plunging restaurant sales.”

The groups add that lacking orders for some finished dairy goods, some processing plants are curtailing or ceasing operations, and the situation has left many dairy processors with limited working capital to continue operating.

The proposed program would be administered by USDA as it possesses the necessary in-house expertise to implement recourse loans, the groups say, noting the department should be authorized to use all types of dairy products as loan collateral, including commodity products as well as specialty products in all segments of the industry.

“Finally, the program should last two years to ensure it can get processors through the crisis, and loan amounts should cover extended terms of up to 120 days on a rolling basis,” the letter says.

CMN


March U.S. cheese production up 0.2% from a year earlier

May 8, 2020

WASHINGTON — In March, U.S. cheese production, excluding cottage cheese, totaled 1.124 billion pounds, 0.2% above March 2019’s 1.122 billion pounds and 9% higher than February’s 1.032 billion pounds, or up 2% from February on an average daily basis, according to data released this week by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Dairy Production chart.)

Italian-type cheese production in March totaled 487.6 million pounds, down 1.1% from March 2019. Production of Mozzarella, the largest component of Italian-type cheese production, was 389.5 million pounds in March, down 0.4% from a year ago.

American-type cheese production in March totaled 448.9 million pounds, up 1.4% from March 2019. Production of Cheddar, the largest component of American-type cheese production, was 318.7 million pounds in March, up 1.1% from March 2019.

Wisconsin, the nation’s leading cheese-producing state, produced 288.4 million pounds in March, down 1.7% from cheese production a year earlier. California followed with 211.0 million pounds, down 2.1% from March 2019.

U.S. butter production in March totaled 194.3 million pounds, up 7.5% from a year earlier. March butter production was up 3.3% from February’s 188.0 million pounds, or down 3.3% on an average daily basis.

California led the nation in butter production at 60.9 million pounds in March, up 10% from a year earlier.

U.S. production of nonfat dry milk (NDM) suitable for human consumption totaled 172.7 million pounds in March, up 6.7% from a year earlier. California led in NDM production with 76.4 million pounds in March, up 11.5% from March 2019.

CMN


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Today's Cheese Spot Trading
May 27, 2020


Barrels: $1.9250 (+1 1/2)
Blocks: $2.0475 (+8 1/2)


Click here for more market activity
Cheese Production
U.S. Total March
1.124 bil. lbs.


Milk Production
U.S. Total April
18.700 bil. lbs.

Guest Columnist

Keep cheese demand momentum going with shopper engagement

Jeremy Johnson, International Dairy Deli Bakery Association

Digital resources connect kids, dairy

Tammy Anderson-Wise, Dairy Council of California

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