But like so many once-unhealthy foods turned healthy, Americans are using real butter again beyond just popcorn, as some reports indicate it may be good for you after all. That healthy-halo effect is driving up prices. Not to be overshadowed by its neighbor in your fridge, cheese is making a comeback too, as people are eating more than ever.
Consumption of margarine continues to plummet nationally as consumers seek to reduce the amount of trans fats, which have been linked to increased risk of heart disease.
«Butter has been garnering a better health perception over the last 18 months or so,» said David Maloni, chief commodity strategist at the American Restaurant Association. «A lot of it has to do with trying to eliminate, or limit, trans fats in diets and in menus.»
Consumption of margarine continues to plummet nationally as consumers seek to reduce the amount of trans fats, which have been linked to increased risk of heart disease.
«Butter has been garnering a better health perception over the last 18 months or so,» said David Maloni, chief commodity strategist at the American Restaurant Association. «A lot of it has to do with trying to eliminate, or limit, trans fats in diets and in menus.»
The latest research from Nielsen shows millennials leading the health and wellness trend along with baby boomers. While cheese isn’t necessarily considered a health food, its «natural» qualities are appealing to foodies who also drink wine, and to the increasing number of snackers. Nielsen data show approximately 40 percent of Americans snack as a meal replacement.
«With millennials, they are more about sustainability and more about that natural/organic — that is what they kind of value,» said Carman Allison, Nielsen vice president of consumer insights. «When you look at the boomers, they tend to eat healthier because of lifestyle and because of health concerns.»
On average, Americans consume more than 33.4 pounds of cheese each year, more than double the amount they did back in the mid-1970s, according to the U.S. Department of Agriculture. American and mozzarella varieties are among the most popular kinds. That said, our appetite for processed cheese continues to decline.
Cheese ranked in the top five list of food categories making the most contribution to supermarket sales growth over the last four years, according to Nielsen data
Overall, the natural foods trend is leading more companies to renovate longtime product lines. For example, ConAgra‘s Banquet frozen meal line is changing several recipes to use real cheese and real butter and other big food companies such as Kraft Heinz, Campbell Soup, General Mills, Kellogg, Unilever and Hershey are among others with initiatives in various stages to reformulate some classics.
Several of the multinational food companies, including General Mills — owner of Annie’s — have acquired natural-focused brands and will have a presence this week at the Natural Products Expo West, the nation’s largest natural and organic trade show. More than 3,000 companies, large and small, and an estimated 70,000 attendees are expected at this year’s expo in Anaheim, California. Good Food Made Simple, a Massachusetts-based company, is launching a line of waffles at the expo.
«Most of the waffles in the frozen aisle are formulated exclusively with vegetable oil for cost savings, but we went with real butter,» said Julia Khodabandeh, director of marketing at the GFMS brand. «There’s a higher cost to our ingredients but we think it provides a much more satisfying meal.»
Also, restaurants are making menu changes. As an example,McDonald’s last year switched out of liquid margarine to butter on the Egg McMuffin. Maloni of the American Restaurant Association estimated last year’s shift to butter by McDonald’s increased the nation’s annual butter consumption by around 20 million pounds, or about 1 percent of total production. The company also recently added mozzarella sticks, stating on its website that the product is «made with 100 percent real and melty mozzarella cheese.»
«With millennials, they are more about sustainability and more about that natural/organic — that is what they kind of value,» said Carman Allison, Nielsen vice president of consumer insights. «When you look at the boomers, they tend to eat healthier because of lifestyle and because of health concerns.»
On average, Americans consume more than 33.4 pounds of cheese each year, more than double the amount they did back in the mid-1970s, according to the U.S. Department of Agriculture. American and mozzarella varieties are among the most popular kinds. That said, our appetite for processed cheese continues to decline.
Cheese ranked in the top five list of food categories making the most contribution to supermarket sales growth over the last four years, according to Nielsen data
Overall, the natural foods trend is leading more companies to renovate longtime product lines. For example, ConAgra‘s Banquet frozen meal line is changing several recipes to use real cheese and real butter and other big food companies such as Kraft Heinz, Campbell Soup, General Mills, Kellogg, Unilever and Hershey are among others with initiatives in various stages to reformulate some classics.
Several of the multinational food companies, including General Mills — owner of Annie’s — have acquired natural-focused brands and will have a presence this week at the Natural Products Expo West, the nation’s largest natural and organic trade show. More than 3,000 companies, large and small, and an estimated 70,000 attendees are expected at this year’s expo in Anaheim, California. Good Food Made Simple, a Massachusetts-based company, is launching a line of waffles at the expo.
«Most of the waffles in the frozen aisle are formulated exclusively with vegetable oil for cost savings, but we went with real butter,» said Julia Khodabandeh, director of marketing at the GFMS brand. «There’s a higher cost to our ingredients but we think it provides a much more satisfying meal.»
Also, restaurants are making menu changes. As an example,McDonald’s last year switched out of liquid margarine to butter on the Egg McMuffin. Maloni of the American Restaurant Association estimated last year’s shift to butter by McDonald’s increased the nation’s annual butter consumption by around 20 million pounds, or about 1 percent of total production. The company also recently added mozzarella sticks, stating on its website that the product is «made with 100 percent real and melty mozzarella cheese.»
«Butter consumption remains solid after years of decline and increasing in terms of domestic per-capita consumption,» said BB&T Capital Markets analyst Brett Hundley. «Whether it’s McDonald’s or someone else, all of these product formulators and retailers are pushing natural products, and butter certainly fits into that.»
Last month, the USDA raised its 2016 butter price forecast due to stronger-than-expected domestic demand. The government will update its forecasts in March’s World Agricultural Supply and Demand Estimates report, which is set for release Wednesday.
«Our butter business is up,» said Patrick Criteser, president and CEO of Oregon-based Tillamook, a farmer-owned dairy cooperative. «I’ve seen total U.S. butter consumption numbers that were high single-digit increases. Our business has grown better than that just because we’ve expanded geographically.»
CME spot prices for butter set an average price in February of $2.084 a pound, the highest price ever for that month. Spot butter settled last Friday at $2.040 a pound, up 3 percent from the prior week and 16 percent above a year ago. The spot price of butter eased Monday from the prior close and remains well below the current record settlement price of $3.135 a pound, set Sept. 25, 2015.
Higher butter prices are not necessarily a good thing for the margins of fluid milk processors such as Dallas-based Dean Foods. The price Dean pays for Class 1 raw milk is partly based on the price of butterfat. Dean, which doesn’t directly own dairy farms, sources its raw materials primarily from dairy co-ops and independent farmers.
«Butter over the last three years has been a big mover, probably one of the most volatile commodities on earth,» said Robert Chesler, who follows the dairy sector at FCStone, a commodity risk management company. He looks for butter «prices to break a little bit,» citing the considerable premium today of U.S. butter versus the world price.
Last month, the USDA raised its 2016 butter price forecast due to stronger-than-expected domestic demand. The government will update its forecasts in March’s World Agricultural Supply and Demand Estimates report, which is set for release Wednesday.
«Our butter business is up,» said Patrick Criteser, president and CEO of Oregon-based Tillamook, a farmer-owned dairy cooperative. «I’ve seen total U.S. butter consumption numbers that were high single-digit increases. Our business has grown better than that just because we’ve expanded geographically.»
CME spot prices for butter set an average price in February of $2.084 a pound, the highest price ever for that month. Spot butter settled last Friday at $2.040 a pound, up 3 percent from the prior week and 16 percent above a year ago. The spot price of butter eased Monday from the prior close and remains well below the current record settlement price of $3.135 a pound, set Sept. 25, 2015.
Higher butter prices are not necessarily a good thing for the margins of fluid milk processors such as Dallas-based Dean Foods. The price Dean pays for Class 1 raw milk is partly based on the price of butterfat. Dean, which doesn’t directly own dairy farms, sources its raw materials primarily from dairy co-ops and independent farmers.
«Butter over the last three years has been a big mover, probably one of the most volatile commodities on earth,» said Robert Chesler, who follows the dairy sector at FCStone, a commodity risk management company. He looks for butter «prices to break a little bit,» citing the considerable premium today of U.S. butter versus the world price.
Source: CNBC
