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DMI says milk fat demand rising thanks to checkoff research

A dairy industry group says increased demand for milk fat is boosting milk prices.  Dairy Management Inc. CEO Tom Gallagher says farmer-funded nutrition research over the past two decades through the dairy checkoff program has shown the benefits of milk fat, and now the government and consumers are changing their views about dairy products.

Peter Vitaliano with the National Milk Producers Federation says whole milk sales are now trending upward.  “Fluid milk had been on a long decline, but in terms of fluid whole milk, that decline was very sharply reversed around 2013 and we’re seeing increased sales month to month of 5% year-on-year.”

He says other fluid milks are using more milk fat as well, and along with butter, it’s keeping demand strong.  “Butter consumption is increasing faster than milk fat production, and so the butter share of the milk fat supply is going up as we saw in fluid.”

Vitaliano says Farmers are increasingly being paid for the components in milk, and that is likely to continue.  He also expects butter prices to remain well above two dollars a pound.

Vitaliano also credits partnerships with food service and restaurants with increased demand for milk, butter, and cheese.  DMI has worked with chains including McDonald’s, Pizza Hut, Domino’s, and Taco Bell to help better utilize dairy products on their menus.

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