Big news from dairy this week as Dean Foods Co. announced it is filing for bankruptcy protection, while seeking the sale of its operations. It's also in advanced discussions with Dairy Farmers of America, a milk marketing cooperative, on the sale.
Dean Foods is the biggest dairy company in the U.S. — with $7.8 billion in net sales in 2018 and 15,000 employees — and as such its move will ripple out to its packaging suppliers. Just shy of 100 years old, Dean has defined much of the dairy market for years. Consider when it decided to begin offering single size servings of its milk in high density polyethylene containers. The "milk chugs" added 40 percent to its sales when they debuted in 1998.
But time is tough for dairy. As PN economist Bill Wood noted in this week's Numbers That Matter column, dairy sales have been on the decline for nine years, and that number accelerated in 2019 as consumers reach for milk alternatives. And it didn't help that a major Dean customer, Walmart, dropped them after opening its own dairy plant last year.