Fat Conversations (in Fluid Milk)
Author: Nicole Olynk Widmar, Associate Head and Professor, Purdue University, Department of Agricultural Economics
The Department of Agricultural Economics published the 2022 Annual Outlook Issue of the Purdue Agricultural Economics Report earlier this month, including articles by my colleagues with specialized expertise on general economic outlook, impacts of COVID-19 on households, trade and policy, considerations for the next Farm Bill agenda, food price inflation, crop costs and return guides, farmland values and rents, ag credit in 2022, and a look at dairy markets in 2021-2022 (by yours truly).
In considering ‘contemporary dairy issues’ in 2022, I return to an ongoing (and perhaps heightening) debate surrounding fluid milk consumption … in particular, fluid milk consumption across differing products with varying fat contents. Fat content is perhaps the most obviously labeled aspect of fluid milk; many brands denote whole milk, 2% milk, 1% milk, and skim milk by color of the cap, color of the label, or color of the bottle/container, in addition to labeling the fat content in words.
The following is an excerpt from the recently released publication, PAER-2022-6 “Dairy and Milk Markets in 2021-2022”:
While perhaps not headline leading specifically in 2021, fluid milk consumption trends remain a heavily debated aspect of milk demand and markets. A recent report, Examining the Decline in U.S. Per Capital Consumption of Fluid Cow’s Milk, 2003-2018, was released by USDA, ERS researchers delving into milk uses and consumption by children, teenagers, and adults. U.S. per capital consumption of fluid cows’ milk has been in decline for over 70 years, falling at an average rate of 1% per year during the 2000s and 2.6% per year in the 2010s. In analyzing fluid beverage milk data available from Dairy Data files from USDA ERS, it suggests the overall sales quantities by fat content may be worthy of investigation.
While the decrease in whole milk is evident over the time period shown, the more recent upward turn in total whole milk sales may be of interest, especially in light of recommendations for milk fat consumption by children by the American Academy of Pediatrics.
Fluid milk and dairy products are often associated with children’s diets, spurring our recent investigation into consumer purchases in households with and without children present. We have found that households with children indeed bought dairy differently, purchasing not only higher total quantities of milk but also milk with higher fat content. Nonetheless, debates continue surrounding milk fat consumption, especially given the ongoing economic and political concerns surrounding school meals and milk provision, as well as the consideration of school closures (or threats of school closures) due to the pandemic.