America’s largest milk producer goes bankrupt
Dean Foods, America’s largest milk producer, has filed for bankruptcy. The 94-year-old company — known for brands including Country Fresh, TruMoo, Land O’Lakes, and DairyPure — has faced years of falling sales and financial setbacks as Americans drink less cow’s milk, and as key big-box retailer customers like Walmart have opened their own dairy plants to supply store-branded milk.
“Despite our best efforts to make our business more agile and cost-efficient, we continue to be impacted by a challenging operating environment marked by continuing declines in consumer milk consumption,” Dean Foods CEO Eric Beringause said in a statement. The company has secured $850 million in debtor-in-possession financing to keep operations running and employees (of which there are approximately 15,000) paid while it looks for a buyer — potentially the Dairy Farmers of America, a cooperative made up of about 14,000 dairy producers.
Americans are now drinking less traditional cow’s milk than ever before. “If we would go back 30 years to 1989, milk was present at 15% at all occasions in the home. Fast-forward to today, that number is now 9%,” an analyst at market research company NPD Group told Fast Company. According to U.S. Department of Agriculture data, U.S. consumption of milk is down 39 percent over the past 40 years, and is now at the lowest level since the agency began keeping track in 1975, the Wall Street Journal reports.
Meanwhile, alternative milks like soy, almond, and oat are becoming more popular, as consumers seek out healthier or plant-based options. Although sales of those alternatives remain only a fraction of the traditional milk market, sales have grown continually and are expected to surpass $18 billion globally this year, CNN reports. It seems that the death of Big Milk is just one more thing to blame on millennials.
Correction: 4:45 p.m., November 15, 2019: A photo caption originally stated that Organic Valley is among the brands owned by Dean Foods. Organic Valley has a joint venture with Dean Foods, but is not owned by the company.
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