Growing Exports Vital to Dairy Industry’s Success

Exports could hold the key to dairy industry success. ( iStock )

The key to the dairy industry’s success lies in exports as the world’s growing middle class seeks to add more dairy to their diet, according to milk marketing experts who participated in a panel discussion Jan. 18 at the Dairy Strong conference in Madison, Wisconsin.

Panel moderator Mike North, who is president of the Dairy Business Association, kicked off the discussion by pointing out an estimated 15 percent of milk produced in Wisconsin is exported to other countries. 

“Trade is an important issue to Wisconsin dairy farmers since that is where the future is, along with encouraging Americans to consume more dairy,” North said.

Chad Vincent, CEO of the Wisconsin Milk Marketing Board, which is funded by the state’s dairy check-off program, said Wisconsin has what it takes to “dive in more to the international markets.”

“Wisconsin leads in cheese production and we have an infrastructure in place to grow even more. There are few places like Wisconsin where you have research, government, processors and farmers pulling in the same direction,” Vincent said.

During the 2016 presidential election, trade was incorrectly blamed for people’s financial problems, said Dr. Michael Dykes, CEO of International Dairy Foods Association. 

“Trade deals are about access to markets, which is what we want to grow business, but most consumers do not see that,” he said. “We need to reform that discussion. In agriculture, we sell more than we buy so there’s no trade deficit.”

Changing dynamics

Chuck Conner, the CEO of National Council of Farmer Cooperatives, said the political dynamics around trade have dramatically changed since he worked with President George W. Bush and his senior staff on formulating domestic and international food, trade, security and energy policy.

“Trump changed the trade dynamic – anything that says trade is bad,” he said. “Trade votes in Congress were always razor-thin, but you could count on Republican support. I am not too sure about that (today).”

U.S. Agriculture Secretary Sonny Perdue understands the importance of trade to farmers and is pushing the president to stay in the North American Free Trade Agreement, Dykes said. 

“While Trump may be negative about trade, we do have supporters in the administration who are advocating for ag trade concerns.”

Another benefit for dairy farmers is having former Agriculture Secretary Tom Vilsack at the head of the US Dairy Export Council, a check-off program that represents the international interests of American dairy farmers and processors, Dykes said. “He can help open a lot of doors for dairy farmers.”

Growing at home

Beyond expanding foreign markets, farmers can grow business here at home by making sure their stories are being heard, Vincent said. He said many customers are confused about what’s healthy and what’s not because of misleading ad campaigns. 

“The good news is that people trust farmers and that is something we can take advantage of. We need to get out there and tell our stories and be transparent about what we do,” Vincent said. “It is not good enough to wait and just react to what activists are saying.”

Vincent said that when people visit farms and talk with farmers about what they do, there’s a mind shift. “They understand why we do what we do,” he said.

People care about where their food is coming from and some marketers are looking to take advantage of that by using farmers in their ad campaigns, Dyke said. “Farmers have a high level of credibility with consumers and we need to be in the story.”

Dairy Management Inc., which is the national dairy check-off program, sent scientists to McDonald’s to show them the difference between using butter and margarine in cooking. “That convinced them to make the switch, and after McDonald’s made the shift, others followed,” Vincent said. “That move resulted in more dairy products being consumed.”

Connor said farmers need to be united whether it is on trade issues or dairy promotion. “I’ve never seen farmers lose in 37 years on Capitol Hill when we are all speaking with the same voice,” he said. 

Watch the panel in the Facebook video below:

Panel: Dairy economics & the future of U.S. milk marketing

Key CEOs talk about dairy economics and the future of U.S. milk marketing! This panel is sponsored by Compeer Financial! The panel consisted of Chad Vincent of Wisconsin Milk Marketing Board - WMMB, Michael Dykes of International Dairy Foods Association and Chuck Conner of National Council of Farmer Cooperatives! #DairyStrong18

Posted by Dairy Strong on Thursday, January 18, 2018