The early success of an innovative new fluid-milk product is prompting the farmer-owned Darigold cooperative to renovate and expand its production facilities in Boise.
The product — Darigold FIT — is a shelf-stable, lactose-free, fluid-milk product with 75% more protein and 40% less sugar than traditional milk. Introduced about a year ago, FIT sales and distribution have doubled over the past six months.
In response to growing consumer demand, Darigold is investing $67 million in its Boise, Idaho, plant to add capacity for FIT production and a modern aseptic bottling line.
FIT is currently produced at the company’s plant in Portland and will be produced in Boise beginning this fall, helping Darigold significantly grow FIT capacity.
“We’re really excited here at Darigold,” Duane Naluai, Darigold senior vice president and leader of consumer products, said.
FIT was inspired by Darigold’s farmer owners as a means of revitalizing fluid milk demand, he said.
“They, more than anyone, know Darigold must provide consumers with new and relevant types of milk that preserve the wholesome and nutritious foundation which makes milk great in the first place,” he said.
Consumers are looking for “better-for-you” products that are nutritious and delicious at a good price in the correct package. They are interested in products that offer more protein and less sugar, he said.
FIT does that, retaining all the macronutrients milk provides in its natural form, he said.
“Our intent was to really deliver to consumers all the great benefits of milk in a way that’s on trend,” he said.
The traditional gallon of milk still represents the majority of milk purchases, but Darigold wants to make sure it’s also innovating because consumers today continue to look for a lot of alternative beverages, he said.
“This investment in FIT milk in Boise allows us to modernize and contemporize and make it (milk) relevant to consumers today,” he said.
Darigold is positioning FIT as an all-family beverage, not a performance beverage. Milk is still in 95% of households, but consumption continues to drop. Milk is losing consumers to other beverages such as water, juice, tea and sports-recovery drinks, he said.
FIT is a way to reintroduce people to all the great attributes of milk and bring consumers back, he said.
Darigold is trying to be more relevant in the larger category of beverages and is investing in a bottling line to be able to perform like a beverage company, he said.
While all added-value milk beverages bring a premium over traditional milk, the price of FIT is 15% to 20% higher than other shelf-stable milk beverages. Retailers set the price, but it’s a good value for a slight premium, he said.
The aseptic bottling line will allow Darigold to use the shelf-stable form to expand distribution. While the U.S. market is Darigold’s priority, there could be an opportunity to expand availability elsewhere, he said.
The shelf-stable product also provides a benefit to retailers, the environment and the Boise plant as product can be stored and shipped without refrigeration, reducing energy use, he said.
Other environmental benefits include lighter weight bottles, decreased water use and a 50% reduction in the use of corrugated material.
Darigold markets roughly 30% of its milk production as consumer products and the balance as ingredients. Exports account for roughly 40% of its milk production. Total net sales in 2019 were $2.3 billion, up nearly 8% from 2017.