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Nation's Biggest Milk Company Declares Bankruptcy

People aren't drinking nearly as much milk as they used to
By Newser Editors and Wire Services
Posted Nov 12, 2019 4:05 PM CST
In this Dec. 4, 2013, file photo Jessica Walton, of Guthrie, Okla., reaches for a container of milk at a grocery store in Edmond, Okla.   (AP Photo/Sue Ogrocki, File)
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(Newser) – Got milk? Increasingly, Americans don't, and that led the nation's biggest milk producer to file for bankruptcy Tuesday. Dean Foods blamed a decadeslong drop in milk consumption that has seen people turn to alternatives like soda, juice and almond milk. The Dallas company said it may sell itself to the Dairy Farmers of America, a marketing cooperative owned by thousands of farmers, the AP reports. "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," CEO Eric Berigause said in a statement. Since 1975, the amount of liquid milk consumed per capita in the US has tumbled more than 40%. Americans drank around 24 gallons a year in 1996, according to government data. That dropped to 17 gallons in 2018.

An increasing variety of beverages, including teas and sodas, has hurt milk consumption. So have protein bars, yogurts and other on-the-go breakfasts, which take the place of a morning bowl of cereal. More recently, health and animal-welfare concerns have also contributed, as more shoppers seek out non-dairy alternatives. Oat milk, for example, saw US sales rise 636% to more than $52 million over the past year, according to Nielsen data. Sales of cow's milk dropped 2.4% in that same time frame. The downturn has had an outsize effect on Dean Foods, which derived 67% of its sales from fluid milk last year, according to its annual report. The company has lost money in eight of its last 10 quarters and posted declining sales in seven of the last eight. It supplies milk for its own brands, like Dairy Pure, Meadow Gold and TruMoo, as well as store brands. One big blow came last year, when Walmart opened its own milk processing plant in Indiana. (See more here.)


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