Dairy Foods Article: “When profits go down the drain”

You lose when you pour valuable milk and butterfat down the drain. You lose again when you have to pay excess sewage fees. Here’s how to control shrinkage in your dairy plant.

The dairy industry must meet the challenge of improving the quality of its products and services while cutting costs and increasing profits to survive in today’s competitive market place. Controlling product losses (commonly referred to as “shrinkage”) is essential to profitability, regardless of the type of plant (fluid milk, ice cream, cheese or butter and powder).

Although controlling shrinkage is important in all dairy operations, it receives more attention in Grade A fluid plants. This is due to the monthly accounting required by the Federal Milk Market Administration. FMMA requires an accurate accounting of all milk received, processed and sold. Consequently, the FMMA report is an overall review of the efficiency of a plant’s operation and one of the first documents to review when investigating possible causes of product losses.

Consider a fluid milk plant that packages 100,000 gallons a day, five days a week. This plant is experiencing a product loss of 2.25%. How serious a problem is this?

Product shrink (skim pounds and butterfat pounds) in an efficiently run fluid plant should not exceed 1.25% loss. Therefore, this plant has a 1% excess loss. The excessive amount of milk loss is 1,000 gallons a day, 5,000 gallons a week or 260,000 gallons a year.

52 tankers, down the drain

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Article written by: Karrick McKinney