Dairy Products Profile

Overview

Only about one-third of the U.S. milk supply is actually processed into milk and cream products; the remaining two-thirds of the milk supply is used to manufacture a wide range of dairy products. Sales of these dairy products, such as butter, ice cream and yogurt, account for tens of billions of dollars annually in the United States. Producers can capture a part of that billion-dollar market by processing and selling their own line of value-added dairy products manufactured on their farms.

Processing

The United States had 1,272 dairy product manufacturing plants in 2016, down only one plant from the previous year. With 211 dairy product plants, Wisconsin continued to support the most plants in any state. Other leading dairy processing states were California with 114 plants and New York with 108 plants. 

Value-added Products

Butter
U.S. butter production in 2016 totaled 1.8 billion pounds, down slightly from the previous year. More than half of the butter came from cream not needed when milk was used for fluid milk or cheese. Butter consumption per capita (person) has increased slightly through the years, averaging 5.7 pounds in 2016.

Frozen Desserts
There are nearly 400 ice cream processing plants in the United States. The table below shows the amount of regular ice cream, lowfat ice cream, frozen yogurt and sherbet produced that year. While the amount of regular ice cream and sherbet declined from the previous year, the amount of frozen yogurt jumped by double digits.

Frozen Dessert Production

Frozen Dessert 2011 U.S. Production, in million gallons
Ice Cream, Regular 787
Ice Cream, Lowfat 435
Frozen Yogurt 67
Sherbet 41

Source: NASS, 2017.

In 2016, per person consumption of ice cream was 13.1 pounds, lowfat ice cream consumption was 6.4 pounds per person and frozen yogurt was 2.8 pounds (ERS 2012).

Sour Cream
Total sour cream production in the United States was 1.4 billion pounds in 2016, up slightly from 2015. Sour cream was processed at 114 dairy plants throughout the country.

Yogurt
Yogurt production in 2016 totaled 4.5 billion pounds at 130 processing plants. Per person yogurt consumption was 13.7 pounds in 2016 in the United States.

Yogurt is being touted as a healthy or functional food due to probiotics. According to Dairy Management Inc., probiotics “are key ingredients in any product promoting digestive health.” About 80 percent of the yogurt manufactured in the United States contains Lactobacillus acidophilus. The Bifidobacterium strain is also found in dairy products.

Yogurt is now being incorporated into other products. General Mills', Kellogg's and Quaker Oats sell cereals containing yogurt. McDonald's and Wendy's offer yogurt-based products on their menu. Purina has introduced dog and cat foods containing yogurt. Yogurt has also been added to toothpaste, mouthwash, facial masks and suntan products.

Sources

Dairy Products Annual Summary, National Agricultural Statistics Service (NASS), USDA.

National Agriculture Statistics Service (NASS), 2017.

USDA, 2017

Dairy Consumption, USDA, 2017

Links checked September 2017.