The dairy industry


in the USA and across the world remains one ofthe most vibrant industries due to the increasing demand of milk andother daily products. The daily industry deals with the rearing ofmilk producing cows, production of milk, processing, distribution andmarketing. The enhanced technology in the cow rearing, processing ofmilk and other milk products, as well as storage has seen theindustry grow in leaps and bounds over the last few decades (Grant,2010). The demand for milk and other dairy products has beenincreasing over the years necessitated by the rural urban migration.The mostly demanded dairy products include milk and its products suchas cheese, yoghurt, butter, pasteurized milk, milk powder, gelato andice cream. These are dairy products that require high standards ofhygiene and enhanced technology in their production.

Looking at the US dairy industry, it is abundantly clear that thedairy industry is indeed a vibrant industry that earns the countryincome through export. The US is the 6th largest producerof milk in the world and it exports 13% of the total milk produced.States such as California, Idaho, New York and Texas are the largestproducers of milk in the US. began in the US inthe early 1600 when the immigrants brought in dairy cattle forproduction of milk which was meant for home use (Pirtle, 2011).However, due to the movement of people from the American rural areasto the urban centers, the production of dairy products has beencommercialized with farmers rearing dairy cows such as Friesian whichare known to produce large quantities of milk.

With commercialization of the dairy products, it is essential tostate that the industry has undergone strict scrutiny from the socialand environmental movements, as well as the government agencies toensure that the quality of the dairy products are up to standards forhuman consumption. This has necessitated various changes in the dairyindustry, not only in US, but also in other countries such as Irelandand New Zealand. Farmers have adopted milking machines,refrigerators, pasteurization equipment and bottling machines. Thishas ensured that the dairy products reaching the consumers arehealthy and up to the standard for human consumption. Over the years,the dairy industry in US has experienced a sharp decline in thenumber of cows (Grant, 2010). However, it is worth noting that thedecline in the number of cows was coupled with an increase of milkproduction per cow. It is essential to note that the production ofmilk has increased almost 6 times in the last ten years due to theimproved techniques and technology in the industry. The dairyindustry is also dominated by Holstein breeds which are known toproduce the highest amount of milk in the world.

The business of dairy industry is mainly practiced by families. 99%of the dairy farms in the USA are owned by families. However, themovement of dairy products from the farmer to the end user may gothrough a number of middle men (OECD, 2012). This may include themilk processors, distributors and even retail sellers such as thesupermarkets. in the US has brought farmerstogether through dairy cooperatives which they form to protect thefarmers’ interests (Grant, 2010). The cooperatives can eitherprotect the farmers’ raw products’ prices or the processedproducts’ prices. The cooperatives also have the responsibility ofmarketing the various daily products both locally andinternationally.

The US government has also developed some policies and laws whichare aimed at protecting the farmers through protecting the price ofsome daily products from decreasing to extreme levels. For instance,the Dairy Product Price Support Program (DPPSP) is a regulation thatasserts that the federal government should be ready to buy certainproducts from dairy manufacturers at specified prices. The productsare American cheese, non-fat dry milk and butter from themanufacturers. This policy ensures that the prices of these productsdo not go below certain levels hence protecting the dairy farmers.Another policy is the Dairy Export Incentive Program (DEIP) whichseeks to encourage dairy manufacturers and producers to export theirproducts. The presence of these policies shows the interest that thefederal government has in the dairy industry due to its role in theeconomy and in the food sector.

The demand for milk across the world keeps on increasing and dairyfarming and the dairy industry as a whole is competing to supply thedairy products. Research has indicated that liquid milk is mostdemanded form of milk across the world. However, other dairy productsfrom milk such as cheese are gaining popularity and are beingdemanded more than the fresh liquid milk (Pirtle, 2011). This isespecially in the US where cheese is on high demand. Competition onthe international level is extremely high and producers andmanufacturers of dairy products are developing new strategies toensure that they succeed in their marketing. For instance in the US,the supermarkets are demanding finished products such as butter andcheese from the farmers since they are in high demand. US aloneexports dairy products worth over 4 billion dollars per year and thisis only 13% of the dairy products (Grant, 2010). The local demand isextremely high considering that it is even backed up by imports fromcountries such as New Zealand and Ireland.

cannot be discussed without looking at theemployment that it has created for both locals in the respectivecountries, as well as foreigners. In USA for instance, 50% of theemployees in the dairy industry are said to be foreign workersimported from other countries. The industry in the US has employedover 138,000 fulltime farm employees and this is an indication of howbig the industry is (OECD, 2012). Another aspect that is associatedwith the dairy industry is land use. It is evident especially in theUS that the crop land has reduced significantly and a majority of itis being used for the production of animal feeds.

is one of the sectors of the economy whichreceive little or no recognition but it evident that it contributesimmensely to various world economies. also createsemployment and provides food components to billions of people acrossthe world. Dairy industry has been growing and changing structurallyover the last decade. The industry has adopted technologies that haveallowed the production of numerous dairy products from milk and whichhave been received well in the market (Pirtle, 2011). Products suchas yoghurt and cheese would not have been realized was it not for thetechnology and advancements that have been realized in the industry.


Grant, W. (2010).&nbsp: An internationalcomparison. Aldershot: Dartmouth.

Organization for Economic Co-operation and Development., &ampWorkshop on Agro-Food Policies in Estonia, Latvia and Lithuania.(2012).&nbspGlobal trends in the dairy industry: Outlookfor the Baltics. Paris: OECD.

Pirtle, T. R. (2011).&nbspHistory of the dairy industry.Chicago: Majonier.