Checkoff Delivering More Dairy into International Marketplace

There is a very large world outside of the United States. In fact, 96 percent of the global population resides beyond our borders.

That’s a lot of people and a lot of opportunities for U.S.-produced dairy.

The dairy checkoff recognizes the possibilities to grow demand in nations that have a growing middle class and a hunger for incorporating more dairy into their local cuisine.

Dairy farmers saw the need to increase sales abroad in 1995 when they created the U.S. Dairy Export Council (USDEC) through the dairy checkoff. They also had a vision years later to take their successful foodservice partnership model that has worked very well in the U.S. and adopt it internationally.

The results are working. About 18 percent of farmers’ milk production – roughly one in six tankers – heads to a destination outside of the U.S. American companies offer a full suite of dairy products with strong growth in cheese and dry ingredients. While the final tally from 2022 is not complete, exports are on pace for a record-setting year, with total value at more than $9 billion.

Here are some snapshots that show how the checkoff continues driving sales of dairy internationally.

USDEC export services. While dairy farmers are the main funders of USDEC through their checkoff, the organization also has about 120 members who represent processors, trading companies and other export interests. USDEC uses insights and trends to help these companies identify where the best opportunities are for dairy growth and support a positive trading environment. This includes the expertise to help these companies understand and navigate the complex regulations that are necessary to export into more than 90 countries. William Loux, vice president of global economic affairs for USDEC, said farmers often ask how the organization can add more value to exports. “USDEC builds the reputation for U.S. dairy overseas through our one-stop shop of resources,” Loux said. “Building our reputation and reliability allows us to capture more value and that benefits farmers.”

Upping pizza frequency. People outside of the U.S. see pizza in a very different light. For example, consumers in some countries only enjoy pizza on special occasions – maybe once or twice a year – and they enjoy toppings such as seafood, sweet potatoes and barbecue. USDEC has long promoted U.S. dairy in the foodservice channel and has worked with chefs to increase knowledge of cheese functionality, taste profile and versatility. These efforts built the foundation for Dairy Management Inc. (DMI) to form partnerships with leading U.S. brands. DMI partners with the world’s top quick-service pizza chains – Domino’s and Pizza Hut – to create eating occasions and customized offerings in the pizza category. Rebecca MacKay Allen, senior vice president of global innovation partnerships for DMI, said the volume of U.S.-produced cheese used by these chains in select partnership markets has grown 13 percent the last two years. The work began in 2017 and has reached places such Southeast Asia and the Middle East/North Africa region. One success is the “New Yorker 1 kilo Ultimate Cheese” launched by Domino’s Japan using 2 pounds of U.S. cheese. “That has been a huge success and an example of how we are growing the frequency and awareness of pizza in other markets,” MacKay Allen said. “It’s the gift that keeps on giving as additional markets launch similar versions.”

Eyes and ears of farmers. While USDEC is based in Arlington, Va., it maintains a daily presence around the world. USDEC has employees in 10 offices who work daily to find opportunities to grow demand of U.S.-produced dairy. USDEC has offices in China, Europe, Hong Kong, Japan, Mexico/Central America, Middle East, South America, South Korea, Southeast Asia and Vietnam. Employees in these offices understand the culture, culinary preferences and speak the language, so they successfully identify opportunities, chart the business climate and monitor regulatory activity. “These offices are our rock stars in many ways,” Loux said. “They know the markets and the players and they feed information as to where the trends are in those markets, where the opportunities are. They keep on top of all new regulations that could affect our exports, so they really handle a wide portfolio on behalf of the whole organization.”

Industry support. In addition to partnering with foodservice companies, DMI and USDEC also work across the entire industry to help increase the international footprint. MacKay Allen said the work focuses on the supply side and enhancing export capabilities to help companies become a more consistent provider. One example is DMI’s direct partnership with Associated Milk Producers Inc. (AMPI), a cooperative owned by farmers from Wisconsin, Minnesota, Iowa, Nebraska, South Dakota and North Dakota. AMPI launched a strategy in 2020 to expand its premium processed cheese business in China with foodservice operators, including an upscale U.S.-based burger chain. With checkoff support, AMPI has expanded its cheese use on menus in more than 800 specialty burger locations in China. “Our support and knowledge can help co-ops move faster to achieve our common goal of driving sales and trust for dairy farmers and the products they produce, not just in the U.S. but in places far from home,” MacKay Allen said.

This well-rounded exports strategy is just one way the checkoff is working to build trust and sales of dairy.

To learn more about your national dairy checkoff, visit www.USDairy.com/. For farmers or to reach us directly, send an email to TalkToTheCheckoff@dairy.org.