The COVID-19 pandemic changed the way we eat. More people ate at home as restaurants closed and fewer people left the house to adhere to social distancing recommendations. Being stuck at home during a stressful time, some turned to comfort food and some fired up the oven to bake cookies and breads as a way to pass the time.
Retail sales of milk, butter and other dairy products had a huge bump during the pandemic. The dairy checkoff analyzed just what led people to change their buying habits, hoping to capitalize on some of those behavior changes once life returns to normal.
Will people continue to eat at home, consume more cereal and bake, Dairy Management Inc. CEO Tom Gallagher asked during a teleconference hosted by the dairy checkoff May 19.
“That bodes well for fluid milk and butter and other things and then we can market toward that,” he said.
He gave statistics showing the increase in certain sales at the grocery store before the pandemic, during a two-week “panic buying” period where people were stocking up on groceries, and more recently.
Retail milk sales had been down by 5% year over year. They increased 34% during the panic buying phase and have since been about 10% higher.
Milk sales are closely tied to cereal, and while cereal sales had been down 1-3% in recent years, they shot up 78% during panic buying and were still up by 17% during the last month.
Frozen pizza sales also offered encouraging news. Sales had been flat in recent years. They were up 125% as people stocked up on food and were up 39% more recently.
The bad news side of the story is in the restaurant industry. Transactions at full service restaurants decreased by 80% during the height of the pandemic and were still down 60% in mid-May. Fast food saw a drop of 42% at the worst of it and were down 20% more recently.
The world may be shut down to curb the spread of COVID-19, but the dairy checkoff has continued its work promoting U.S. dairy products abroad.
The dairy checkoff has been working with Costco in China to advertise dairy products. In the Middle East and Africa, they’ve put cheese-centric recipes in grocery bags to encourage using cheese in meals. In various places overseas, the checkoff has offered webinars and video training to encourage the next generation of chefs to use U.S. cheese in their creations.
U.S. Dairy Export Council President and CEO Tom Vilsack talked about the overseas efforts in the dairy checkoff teleconference.
Southeast Asia is an important market for the U.S., he said, noting that it has surpassed Mexico as the No. 1 market for milk powder. He said the U.S.-Mexico-Canada agreement should help stabilize the milk powder market once it takes effect July 1. The dairy export council also supports continued work on the Phase 1 agreement with China.
The first three months of 2020 looked encouraging for dairy exports. The U.S. sent out 44,000 more metric tons than the previous year. But Vilsack expects to see a decline in spring and early summer. He said they’ll continue to use social media to promote dairy and look forward to an increase in sales later in the year.
“We are dealing with a much changed landscape,” he said.