The Rural Voice, 2006-02, Page 16What's dairy's future in Ontario?
From consumer trends to the size of dairy herds, experts envision what
ildairy will be like in the future
The future of the dairy industry
will revolve around doing
more to please the consumer at
the processors' end and working
smarter at the farm level.
Such were the predictions of
speakers at Grey -Bruce Farmers'
Week looking into the crystal ball to
foresee the future of dairy.
Ultimately, the consumer will
shape the industry's future and
Andrew MacGillivray, CEO of Gay
Lea Foods Co-operative and chair of
the dairy processors's association
thinks innovation will be the key to
remaining relevant to consumers.
Four consumer trends are driving
the food industry, MacGillivray said.
"Taste is essential," he said. "We
must deliver taste. Despite a lack of
time (for cooking) they still demand
taste and we must deliver."
Luckily, he said, dairy delivers
taste. Corn tastes better with butter
and short -bread "doesn't exist
without butter".
Dairy is also well placed to
deliver another consumer must:
nutrition. But nutrition goes beyond
just providing energy, calories, etc,
MacGillivray said. Consumers want
their food to be the answer to special
needs, hence demand for products
like Omega-3 eggs.
The dairy industry has long touted
milk as a near -perfect food but some
consumers see soybeans as healthier
and see margarine as a healthier
alternative to butter. "Dairy needs to
re-establish itself as a healthy food."
Convenience is a consumer must
as people have more daily demands
and less time to fulfill them. Part of
convenience is portability. Milk, in
12 THE RURAL VOICE
its traditional "gable -top" carton or
bag packaging may not be
convenient, he said. However, there
are experiments taking place to put
milk in vending machines just like
soft drinks and this might increase
the convenience.
Answering a question from the
audience on why milk hasn't moved
to useround containers,
MacGillivray said such a change
would be a huge investment for
processors and is likely years away
but the experimental vending
machines already use round
containers. There's a growing
demand for milk as a portable drink
as people become more concerned
about nutrition. "Suddenly
McDonald's and Tim Hortons want
milk," he said.
The industry has responded to
demand for convenience with new
products like cheese strings and the
biggest growth area in dairy: yogurt.
While dairy products have a good
solid base in taste and nutrition, the
industry needs to make dairy
products exciting to consumers,
MacGillivray said. The only way to
do this is to innovate.
"There have not been many
innovations in fluid milk," he said. In
the past 20 years per capita milk
consumption has dropped 14 per
cent. "We should be concerned about
that."
Butter remains "the same old
pound" and there has been no growth
for the past 10 years. That led Gay
Lea to create "spreadable butter"
which has 65 per cent real butter.
There's been a lot of controversy
whether the company should be
mixing butter and vegetable oils but
the innovation is to create a product
that is more convenient and more
relevant for consumers, he said.
New varieties of yogurt are being
created for different markets, hoping
to boost what has been a 200 per cent
growth in per capita consumption of
the healthy, convenient food.
The challenge for the industry is
how to be even move consumer -
focussed, MacGillivray said.
"They're more and more
demanding," he said. "How do we
offer better taste? How do we
enhance nutrition?"
MacGillivray said that when Gay
Lea tried to introduce spreadable
butter far more time was spent
dealing with bureaucracy than talking
about how the consumer could be
better served.
"We need to develop a growth
orientation," he said of the dairy
industry. "If you are not growing,
you shrink."
World Trade Organization (WTO)
negotiations may see a requirement
for Canada to give greater access to
foreign dairy products while Canada
is likely to have no exports at all,
MacGillivray said. "That is not a
growth orientation. How do we grow
our business?"
Growing the business could mean
quota increases instead of quota cuts,
he said. For processors it could mean
better utilization of processing
capacity. Gay Lea's new skim milk
plant at Guelph is a "beautiful thing"
when it's operating at full capacity
but not when it's operating at 60 per
cent capacity.
Though he seeks growth and