— The head of global markets for Sartori Cheese sees great potential for expanding product exports, despite certain trade barriers and distribution issues.
“Cheese demand is there and it’s growing, and continues to be growing significantly,” said Sam Allison, global markets manager for the Plymouth-based cheese producer. He spoke yesterday during a webinar hosted by the Madison International Trade Association.
He noted U.S. milk production has been growing in recent years and is now outpacing domestic demand, with over 75 percent of the country’s milk production growth in 2020 going toward exports. As worldwide demand also continues to rise, Allison said the United States’ top two competitors for cheese production — the European Union and New Zealand — are “running into challenges” with increasing their production levels.
“There’s a lot of opportunity out there,” Allison said.
Sartori Cheese is a fourth-generation family-owned company that’s been making cheese since 1939, with facilities in Plymouth and Antigo. The company has developed relationships with local dairy farms, most of which are within 50 miles of their production facilities. Allison explained that using fresh milk in the production process is critical for making good cheese.
He said global exports support a big part of the company’s growth, and retail exports are largely focused on Canada and Europe, followed by Mexico, Australia and China.
“There’s a wide variety of specialty cheese understanding and development in those markets,” he said.
Still, he highlighted trade barriers standing in the way of expanding exports to these countries, including supply chain problems hindering distribution on a global scale. He also explained that exclusive regional product names, or “protected geographical indicators,” can create issues for exporters. For example, parmesan cheese is a generic name, while the name Parmigiano-Reggiano is restricted to the regions of Italy where the cheese was traditionally produced.
“It’s an ongoing non-tariff barrier that we run into, as the Europeans work very hard to build [geographical indicator] protections into the trade agreements that they make around the world, so that only Italian producers can sell parmesan to those markets,” he said. “Then they end up missing out on the great parmesan that comes from our facilities here in Wisconsin.”
Over the past decade or so, Allison noted perceptions of U.S. cheeses among European consumers have been improving. Market research has found that opinions have shifted dramatically for the better, he said.
But while Wisconsin enjoys a strong reputation for cheesemaking quality within the United States, Allison explains that many buyers around the world don’t associate Wisconsin with cheese at all, which can pose a challenge.
“It’s a big mystery, and that’s really important for cheese producers. When you’re selling a specialty product, the romance, the origin story — all of those things are a big part of the experience for the consumer,” he said. “Being able to share that is critical.”
He also touched on the pitfalls of getting pulled into discussions on American national politics while selling U.S. products, noting “it can be very polarizing.”
“It’s very easy when you’re overseas to get yourself trapped into a conversation about Mr. Trump or Mr. Biden. When you’re trying to sell cheese, that’s the last thing that you want to do,” he said. “We’ve really tried to focus on Wisconsin, and telling that story, because I think it’s something that’s a huge, huge opportunity.”
— Another food products exporter, Chippewa Valley Bean, saw a major increase in demand worldwide for its kidney beans during the pandemic.
“At the beginning of the pandemic, we saw a huge increase in consumption, not just in the U.S. but throughout our export world,” said Cindy Brown, the company’s president. “We had a very hard time trying to keep up with it.”
Minnesota leads the nation for kidney bean production, but Brown said about 60 percent of the U.S. kidney bean crop moves through Wisconsin before being exported around the world.
During yesterday’s MITA webinar, Brown explained that the company has increased its size “quite dramatically” in recent years and built a new distribution center that has “given us capacities to move product much quicker.” She noted global supply chain issues have led to slowdowns in distribution, but added the new facilities have given the company more flexibility through increased storage capacity.
Early on in the pandemic, many consumers were dining at home through choice or necessity during lockdowns, and Brown said that tendency hasn’t gone away while the pandemic has waned. Although demand for kidney beans has dropped somewhat from its peak in the height of the pandemic, she said “it’s still really strong.”
On the topic of domestic logistics challenges, Brown said the $1.5 trillion infrastructure bill recently passed by the U.S. House and sent to President Biden could help address “very poor systems” within the U.S. transportation network.
“Whether it’s trucking, whether it’s rail, whether it’s shortage of drivers — it’s a multitude of things,” she said.
With high demand for foreign consumer goods coming into the United States, she said shipments from places like China are tying up “so much of the international trade and shipping capacity.” She said the issue is particularly pressing for agricultural product exporters, “because we’re not finding empty containers” to send products back on those vessels.
“We’ve fought with having containers stuck in Chicago for three months at a time as we’ve tried to use East Coast ports,” she said. “So it’s been a real challenge … We’ve had to be a lot more creative in thinking how we would do this, to make sure our customers don’t have a drop in their supply chain.”
— Wisconsin is projected to see higher soybean production than in 2020, based on projections from conditions at the end of November.
A report from the U.S. Department of Agriculture shows Wisconsin’s projected 2021 soybean production is about 112 million bushels, compared to around 103 million bushels last year. The forecasted yield is 54 bushels per acre, which is up two bushels per acre from 2020.
Potato production in the state is also expected to be higher over the year, the report shows. It’s forecasted at 31.2 million hundredweight for 2021, versus 28.8 million hundredweight last year.
Meanwhile, the state’s corn production for the year is expected to be slightly lower than last year, with about 506 million bushels for the year. That’s compared to about 507 million bushels in 2020. Yields are projected to average 172 bushels per acre, which is down one bushel per acre from last year.
— Gov. Tony Evers has announced $100 million for the next round of the State Broadband Expansion Grant Program.
Funding for this round of grants come from the 2021-23 biennial budget, which included $129 million for projects to expand broadband internet access in Wisconsin. A release from the governor’s office shows that 268 grants have been awarded since the program began in 2014, resulting in more than 296,000 homes and 20,000 businesses being connected with broadband internet.
Grant funding is allocated through the state Public Service Commission. PSC Chair Rebecca Cameron Valcq says the agency “will utilize these dollars effectively and efficiently while maintaining our high standards of accountability and transparency.” Applications for the grants will be available through the agency’s website starting in December.
Of the $129 million the Legislature set aside for the grants, $125 million would be covered through bonds. PSC spokesman Jerel Ballard says the state has not issued bonds for the grant program.
“The program is operated on a reimbursement basis so there are no cash flow needs at this time,” he said in an emailed statement. “The bond term will be determined at a later date.”
Along with the state broadband expansion funding, Evers has also allocated over $105.3 million in CARES and ARPA funding for 94 projects in 42 counties and three tribal communities, the release shows.
See more program details here: https://psc.wi.gov/Pages/Programs/BroadbandGrants.aspx
See the release: https://content.govdelivery.com/accounts/WIGOV/bulletins/2fb4098
— The U.S. Department of Labor is providing a $3 million grant to the state Department of Workforce Development to support the agency’s technology modernization efforts.
DWD says upgrades to its information technology systems will “allow for better case management and improved access” to services from other state agencies, local workforce development boards and other partner groups.
The upgrades are expected to be implemented by late 2023, according to a release from the agency.
DWD Secretary-designee Amy Pechacek says the pandemic’s impact on the labor market “demand a continued, intense focus on solutions” to help employers and those seeking work in Wisconsin.
“These funds will support significant technological updates that will allow us to better connect with those we serve, regardless of where they’re located in the state,” she said in the release.
See the release: https://dwd.wisconsin.gov/press/211108-it-upgrade-award.htm
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