DENVER, Feb. 28, 2022 (GLOBE NEWSWIRE) -- The COVID-19 pandemic has fundamentally altered the global market for high-protein whey products, which have now entered the mainstream as a super food for health-conscious consumers. Global demand for high-protein whey has grown exponentially during the pandemic as consumers around the world sharpened their focus on health and nutrition.
As the global leader in high-protein whey production and exports, the U.S. stands to benefit from the increased demand. Despite record cheese production in the U.S., global supplies of whey products remain tight which has resulted in significant price premiums for high-protein whey products.
According to a new report from CoBank’s Knowledge Exchange, whey prices are expected to persist at historically strong levels until new cheese and whey processing capacity comes online over the next five years. In the longer term, further-processed fractionated whey protein products are expected to become the bigger value-drivers of the whey stream.
“High-protein whey products come with risks of increasing price volatility that’s endemic of niche and diverse product mixes with limited market players,” said Tanner Ehmke, lead dairy economist with CoBank. “To meet the growing demand for diverse whey products while covering the risk of higher volatility, dairy processors will need to invest in processing technologies that allow flexibility in production.”
While high-protein whey will continue to grow in demand and offer higher returns, low-protein whey will still offer the appeal of stability and price hedging for processors, added Ehmke. The dairy industry of the future will need to meet growing demand for low-protein whey for both human consumption and animal feed and for high-protein whey for consumer products.
Total U.S. cheese and whey processing capacity in the U.S. is expected to increase by an estimated 10% in the next 5 years. Increasing whey production means an increasing commoditization of all whey products, including high protein concentrates and isolates.
Whey production will become increasingly stratified across products and prices, requiring processors to invest in processing technology to allow for flexibility in production for a variety of whey products spanning dry whey to fractionated whey. The high costs of membrane technology required for further processing of whey will limit growth opportunities to larger cheese and whey processors that have economies of scale.
Plant-based alternative sources of protein like soy protein and pea protein are not expected to disrupt the high protein whey market due to nutritional deficiencies compared to whey.
Watch a video synopsis and read the report, COVID-19 Spiked Demand for High-Protein Whey, but is Growth Sustainable?
About CoBank
CoBank is a $170 billion cooperative bank serving vital industries across rural America. The bank provides loans, leases, export financing and other financial services to agribusinesses and rural power, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated Farm Credit associations serving more than 76,000 farmers, ranchers and other rural borrowers in 23 states around the country.
CoBank is a member of the Farm Credit System, a nationwide network of banks and retail lending associations chartered to support the borrowing needs of U.S. agriculture, rural infrastructure and rural communities. Headquartered outside Denver, Colorado, CoBank serves customers from regional banking centers across the U.S. and maintains an international representative office in Singapore.
