Dick Groves
Editor, Cheese Reporter

 

What do you think about 
this Editorial? 

Please tell us if you are a
Dairy product manufacturer 
Dairy marketer/importer/exporter
Milk producer
Supplier to manufacturers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

No End In Sight For Specialty Cheese Boom

At last month’s well-attended and highly informative Wisconsin Idea Dairy Summit in Madison, Dr. John Lucey, director of the Wisconsin Center for Dairy Research, predicted that Wisconsin’s specialty cheese production could “easily” top 1 billion pounds within the next 10 years (for more details, please see WI Idea Dairy Summit Examines Challenges, Opportunities Facing State’s Dairy Industry, on the front page of our June 23rd issue).

Lucey’s prediction got us wondering about a couple of questions. First, is 1 billion pounds a realistic prediction for Wisconsin’s specialty cheese production a decade from now? And second, what would that mean for specialty cheese production for the rest of the US?

In addition to his prediction about specialty cheese production, Lucey also pointed out that specialty cheese “has only just begun” in Wisconsin, and that’s worth keeping in mind when trying to project future specialty cheese production.

The relative newness of specialty cheese in Wisconsin can be verified by noting a couple of things that have taken place in the last 25 years. First, Wisconsin first began tracking specialty cheese production back in 1993 (more on this point later). And second, the Wisconsin Specialty Cheese Institute was founded in 1994.

So is a billion pounds of specialty cheese production in Wisconsin by 2027 realistic? Absolutely. In fact, Lucey’s prediction might be a bit pessimistic; the state’s specialty cheese output could top that level a few years earlier.

Back in 1993, Wisconsin’s specialty cheese production totaled about 83 million pounds. By 2000, production had more than doubled, reaching 221 million pounds. Production then almost doubled again by 2008, when output was 437 million pounds.

And in 2016, Wisconsin’s specialty cheese production reached a record 773.7 million pounds, up more than 200 million pounds just since 2010.

When was the last time specialty cheese production actually declined in Wisconsin? In fact, it never has; since the state started tracking specialty cheese output back in 1993, output has increased every single year.

Granted, some of those production increases were pretty small — for example, 1995 specialty cheese output, at 98.9 million pounds, was up only 3.7 million pounds from 1994 — but production has risen every year for almost a quarter-century now. That’s pretty impressive.

It also makes the prediction of 1 billion pounds of production a decade from now pretty realistic and reasonable.

Here’s another way to look at specialty cheese production growth in Wisconsin that makes the future look mighty bright: over the past five years (2012-2016), specialty cheese output has grown by an average of about 40 million pounds annually. If specialty cheese production continues to grow by 40 million pounds per year, Wisconsin’s specialty cheese output will top a billion pounds by 2022.

Just in 2015 and 2016, Wisconsin’s specialty cheese production increased by more than 100 million pounds total (2015 output was up 55.9 million pounds over 2014, and 2016 production was up 51.8 million pounds over 2015). Using those increases (rounded down to 50 million pounds annually) gets the state’s specialty cheese production to a billion pounds by 2021.

So by pretty much any reasonable estimate, Wisconsin’s specialty cheese production should definitely top 1 billion pounds within the next decade, and possibly within the next half-decade.

That’s just in Wisconsin. What does a billion pounds of specialty cheese production in Wisconsin mean for the rest of the US?

Plenty of opportunities, that’s what it means. And there are a number of ways to support that optimistic outlook.

Just for starters, it’s worth remembering that Wisconsin currently accounts for a little over one-fourth of US cheese production (26.6 percent in 2016, to be exact). So it could be concluded that, when Wisconsin’s specialty cheese production reaches a billion pounds, US specialty cheese output should reach 4 billion pounds.

That’s probably a stretch, just considering that, according to the Wisconsin Milk Marketing Board, Wisconsin accounts for about 45 percent of US specialty cheese output.

Still, that suggests that, within the next several years, US specialty cheese production will top 2 billion pounds, which is pretty impressive considering that US cheese production as a whole didn’t top 2 billion pounds until 1970.

Certainly there are other indications that the specialty cheese boom will continue in the years ahead. How about Kroger’s acquisition earlier this year of Murray’s Cheese?

At the end of fiscal 2016, Kroger operated (either directly or through its subsidiaries) 2,796 supermarkets under a variety of banners. Last December, Kroger announced that Murray’s Cheese had opened its 350th store location in Bloomington, IN, through its special partnership with the Kroger family of stores.

Through its acquisition of Murray’s, it seems that Kroger, one of the largest food retailers in the US, believes pretty strongly in the future of specialty cheese.

There are numerous other similar examples of companies acquiring US specialty cheese businesses in recent years, including Switzerland’s Emmi buying Cowgirl Creamery, Redwood Hill and Jackson-Mitchell, to name just one.

It’s difficult if not impossible to put all of this together and not be extremely optimistic about the future of specialty cheese sales in the US.


Cheese Reporter welcomes letters to the editor. Comments should be sent to: Dick Groves by Fax at (608) 246-8431; or e-mail your comments to
dgroves @cheesereporter.com.

 

Missed Last Week's Editorial?