A SPECIAL PRODUCERS’ REPORT OF AG ALERT ® CALIFORNIA Dairy & Livestock
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Jersey cows that produce milk for Land O’ Lakes are pictured in Tulare County in 2024. In July, the farmer-owned dairy cooperative an- nounced it was upgrading its Tulare processing facility so that it can begin manufacturing protein-rich dairy products such as ultra-filtered milk. The upgrade is part of a multi-billion-dollar investment by dairy processors nationwide to capitalize on rising demand for protein.
Protein boom marks ‘paradigm shift’ in dairy sector By Caleb Hampton Rising demand for protein is creating new market opportunities for dairy producers and driving decisions made by farmers and processors.
According to a CoBank analysis, dairy processors have invested a record $14 billion in new or remodeled processing facilities that are currently under development and set to begin operating by 2028, with protein demand driving some of those investments. In July, Land O’ Lakes announced it was investing $34 million to upgrade its Tulare facil- ity so that the Minnesota-headquartered dairy cooperative can manufacture “high-value dairy protein” products, starting with ultra-filtered milk. The process involves filtering fresh milk through membranes that separate the milk’s components, enabling manufacturers to remove water and lactose, and concentrate the protein content in the final product. “The investment is designed to help us meet growing demand for high-quality dairy protein while unlocking greater value from member milk,” said Heather Anfang, executive vice president at Land O’Lakes and president of dairy foods at the cooperative. “Protein has moved beyond a niche health category to become a defining force in how consumers evaluate food.” The facility upgrade is under construction, Anfang said, with production of ultra-filtered milk set to begin early next year. Geiger said dairy farmers stand to benefit from the sector tapping into the protein boom, but the pivot also brings some challenges.
Last year, 70% of U.S. consumers said they wanted more protein content in their diets, up from 59% in 2022, according to the International Food Information Council’s Food & Health Survey. Market research also showed consumers were willing to pay a premium for products labeled high in protein. Corey Geiger, lead economist for dairy production and processing at CoBank, said multiple factors have made protein a dietary priority for consumers. These factors include an emphasis placed on protein by the Make America Healthy Again movement, new dietary guidelines released this year by the Trump administration that increased the recommended amount of daily protein intake, and the growing preva- lence of GLP-1 medications, with those on the weight loss drugs advised to pack protein into their limited calorie consumption. This year, sales of protein-rich dairy products such as whey protein powder, ultra-fil- tered milk, Greek yogurt and cottage cheese have all increased, according to the market research firm Circana. Industry experts believe protein demand will remain heightened, and dairy producers are developing new processing capacity to cater to the market. “This is a paradigm shift,” Geiger said.
See PROTEIN, Page 11
10 Ag Alert November 4, 2026
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