Dean Foods, the largest dairy producer in the United States, filed for bankruptcy. The company has been experiencing problems for several years due to competition with vegetable drinks. It is reported by CNN.
The 94-year-old company has been producing milk and dairy products under some of the most famous brands like Dairy Pure, Organic Valley and Land O’Lakes. Dean Foods blamed the situation for the accelerated decline in demand for the plain white milk category.
By November 2019, the company was no longer able to cover expenses and filed for bankruptcy to reorganize the business and resume payments to employees, while the owners are looking for a buyer.
A Dean Foods statement said the company is in talks with a Dairy Farmers of America cooperative, which could buy it in its entirety. As part of the bankruptcy, Dean Foods received $ 850 million from current lenders to continue working.
As CNN noted, in recent years, Americans have consumed less and less traditional milk and more and more alternative drinks. According to analysts, in 2019 the market for milk substitutes will grow to $ 18 billion – this is 3.5% more than in 2018.
At the same time, the traditional milk market will reach $ 120 billion, but its share has been declining over the past four years. According to Nielsen, in the last 52 weeks until the end of October, milk sales amounted to $ 12 billion, which is $ 3 billion lower than in 2015.
Demand is reduced for all types of cow’s milk, including options with 1% and 2% fat and skim milk. At the same time, sales of oat milk increased by 636% in 2018