By Dianne Hardisty
Moooovvve over, Bessie. Plant-based “milk” products are gaining in popularity. But the dairy industry is fighting back.
A battle is underway in the nation’s courts and at the Food and Drug Administration over the plant-based milk industry, particularly the producers of almond milk, using the word “milk” on its labels.
The dairy industry contends consumers are being confused and misled when the word “milk” is associated with products not produced by cows or other lactating animals. Plant-based milk producers contend the argument is just plain nuts. And, increasingly, federal judges seem to agree.
In a case brought against the California cooperative Blue Diamond Growers, the U.S. Ninth Circuit Court of Appeals dismissed claims that the company “mislabeled its almond beverages as ‘almond milk’ when they should be labeled ‘imitation milk’ because they are a substitute for and resemble dairy milk, but are nutritionally inferior to it.”
The court ruled in December that “notwithstanding any resemblance to dairy milk, almond milk is not a ‘substitute’ for dairy milk … because almond milk does not involve literally substituting inferior ingredients for those in dairy milk.”
Earlier, a federal court in California blocked a similar lawsuit against the producer of Silk alternative milks by ruling that “It is simply implausible that a reasonable consumer would mistake a product like soy milk or almond milk for dairy milk from a cow. … The first words in the product’s names should be obvious enough to even the least discerning of consumers.”
Interestingly, the recent skirmishes over milk labeling have roots in a dispute within the dairy industry itself. In 2012, a small Florida creamery was producing an all-natural skim milk, which was a byproduct of its cream production. In the skimming process, almost all of the milk’s naturally occurring vitamin A was lost.
Florida law, which mirrors federal law, bans the sale of skim milk unless vitamin A is added. The creamery owner argued that to do so defeats her company’s goal of producing additive-free milk.
Eleventh Circuit U.S. Court of Appeals justices sided with the creamery owner. The justices ruled that there was nothing deceptive or misleading in the all-natural skim milk, which lists the product’s ingredients on the label.
In noting the need to protect the creamery’s First Amendment speech rights, justices found that the state’s effort to prohibit the use of the term “skim milk” was “clearly more extensive than necessary to serve its interest in preventing deception and ensuring adequate nutritional standards.”
But last summer, as the competition between dairy and plant-based milks heated up, the FDA jumped into the crossfire. The federal regulatory agency surveyed consumers regarding their perception of plant-based milk and found most people considered it to be as nutritionally beneficial as dairy milk.
FDA Commissioner Scott Gottlieb concluded labeling of plant-based beverages as milk may confuse consumers. He also contended products, such as soy milk and almond milk, were just not “milk” because they lacked some of the ingredients found in dairy milk and “an almond doesn’t lactate.”
Nut and soybean growers lashed back. With an easy reach for just about any dictionary, they cited definitions of plants “lactating,” or giving off milky substances. They also noted a whole slew of products with “milk” in their labels – Milk of Magnesia being one.
The labeling distinction does not seem to matter to consumers, either. Recent industry surveys found that between 2012 and 2017, sales of non-dairy milks grew more than 60 percent, with almond milk accounting for 64 percent of the sales, while dairy milk sales dropped.
In California and Kern County, both dairy and nuts are big business.
“California is the nation’s largest farming state, producing more than 400 commercial food and fiber commodities, and dairy farming is the largest of these commodity groups,” noted the California Milk Advisory Board’s Jennifer Giambroni in an email. “California has been the nation’s largest milk producer since 1993 and is also the country’s leading producer of butter, ice cream and nonfat dry milk. It is the second largest cheese and yogurt producer. More than 1,300 dairy families stand at the center of the state’s vast and growing dairy industry. The state’s dairies house 1.73 million milk cows.”
Giambroni noted that the dairy industry makes a big economic contribution to the state and cited California Department of Food and Agriculture statistics placing dairy farming as California’s leading agricultural commodity. The industry generated $6.07 billion in cash receipts from milk production in 2016.
“The milk that leaves the dairy farm flows into society to become value-added products that create jobs and revenues in local communities,” she said. “According to the most recent Economic Impact Report for California Dairy, the industry contributed about $21 billion to the gross state product in 2014 and about 189,000 jobs in California were dependent on the state’s milk production and processing.”
Dr. S. Aaron Hegde, chairman of the Economics Department at Cal State Bakersfield, notes that Kern County’s approximately 50 dairies produce about 10 percent of the state’s output.
While there has been little change in output, Hegde said dairy prices have declined because of decreased global demand, particularly in China. He attributed the decline to the ongoing trade war with China, as well as some U.S. consumer preferences shifting to “alternatives” to dairy milk.
Almond production in Kern County has been trending upwards, Hegde reported. But similar economic trade constraints also have impacted almond exports to China, which has been an increasing importer of almonds over the last few years.
To make up the loss, the almond industry has turned to new markets, including the production of almond milk, said Hegde.
In January, Blue Diamond announced plans to expand its processing plant in Turlock to accommodate increased production of almond milk. The expansion, which is scheduled for completion in 2020, will make a butter-like base for the Almond Breeze brand. The base will be shipped to locations around the world, where water is added to create almond milk.
If consumers consider dairy and nut milk to be “indifferent” products, or substitutes in economic terms, then the decrease in demand for cow milk would be represented by an increase in almond milk or soy milk consumption, Hegde said. However, limiting the use of the term “milk” on the labels of plant-based products may lead to fewer new consumers making the switch to soy milk or almond milk.
Despite recent court rulings that support a “qualified” use of the term “milk” on the labels of plant-based beverages, the FDA is moving forward with its proposed rule to require such products as almond milk and soy milk to be called fake, imitation or alternative beverages. No date has been announced for the new rule to be adopted.
But after kicking over a beehive of controversy, FDA Commissioner Gottlieb announced in March that he would be quitting in April to spend more time with his family. After only about two years in the office, Gottlieb has managed to unite liberal-leaning opponents of meat-product consumption, including dairy products, and political conservatives, who decry regulations and view the milk labeling squabble as a government overreach.
In a recent nationwide opinion article, the former Republican Attorney General of Virginia, Ken Cuccinelli, called the FDA’s effort to ban the word “milk” on the labels of plant-based beverages a marketing sham.
“Instead of improving their product or marketing, the dairy industry has sought out the government’s help to quash their new competition, and the FDA seems willing to comply,” Cuccinelli wrote. “However, despite all the bluster suggesting deception, less than 10 percent of people actually believe these non-dairy alternatives actually contain cow’s milk.
“There is no widespread deception. The dairy industry just wants protection. It’s a shame the FDA is participating in this assault on freedom of choice and marketing competition,” Cuccinelli wrote, adding that the maneuver “looks an awful lot like the swamp that President Trump so frequently, and rightly, rails against.”
With Gottlieb’s departure, the fate of the proposed rule banning the word “milk” from almond milk labels is uncertain.