There's diet soda and there's lite beer, but are consumers ready to drink "light milk"? Dairy producer WhiteWave Foods (NYSE:WWAV) thinks so, and it's pursuing a patent for the beverage.
According to the Dairy Reporter website, an application for the milk maker was published at the end of last month looking to patent a low-calorie, skim milk concoction that would give drinkers the same sensation they get from fattier milks. While many people might consider skim milk to be a "light" milk already, the patent application points out it it still carries 80 to 90 calories per 8-ounce serving and it believes some people may want even lighter fare than that.
Yet one criticism of skim is that it's milk-flavored water, a thin drink lacking in content and texture. That may be, but WhiteWave's light milk would do them one better and actually be watered down milk. The patent application says the beverage would contain 10% to 50% skim milk with some 50% to 80% of the rest consisting of water.
However, because milk-water might just taste pretty nasty, one or more "accentuating ingredients" would be added to "provide sweetness and enhance appearance and mouthfeel." Such additives could include milk protein isolates or whole milk powder, nutritive sweeteners, and bulking agents such as fructose, sucrose, or maltodextrin. They may also throw in stabilizers, buffering agents, and whiteners. Sound yummy yet?
The application makes the very sound argument that consuming dairy milk provides a multitude of health benefits, and provides calcium, protein, and additional nutrients. But with the industry suffering from declining milk consumption leading to overcapacity, a new milk product may be able to turn the tide.
According to the USDA, per-capita consumption of milk is down 23% since 1975, carried lower due almost solely to whole-milk sales falling 58%. Dean Foods, WhiteWave's former parent, has had to idle between 10% and 15% of its capacity to align itself with this lower demand, and expects to idle a similar percentage in the future.
However, sales of 2% and 1% milk have risen over that same time frame, and what may be driving WhiteWave here is that skim milk has performed even better than that. The lighter milks, being lower in fat, are seen as more healthful, and "light milk" itself could be viewed as the most healthful. While those on paleo diets might argue with that, believing fat is both good and essential, consumers of "light milk" would basically be drinking water with additives to make it look and taste like milk.
A bigger question, though, should WhiteWave actually pursue manufacturing the beverage, is what to call it. The industry is facing a backlash because it wants to hide the fact that chocolate milk is flavored with aspartame. It has to say the milk is artificially flavored, and WhiteWave and others believe that turns off some drinkers.
WhiteWave probably could produce a zero-calorie milk beverage, but the FDA only allows "nutritive sweeteners," or those things that contain calories, to be added and still be called milk, so it would likely not be able to call it that or it would have to say it's artificially sweetened. While the patent application does note the addition of nutritive sweeteners, the additional ingredients might change the label, and it's probably one of the reasons WhiteWave's CEO has lamented the inhibiting effects regulation has on innovation.
But WhiteWave also had to settle a lawsuit recently over its use of the misnomer "evaporated cane juice" instead of what everyone else knows it as: sugar. The FDA has some specific language on the use of ECJ, but a number of companies, from Kellogg to Trader Joe's, have run afoul of the regulation and been sued because of it. Kefir maker Lifeway also includes ECJ in its dairy products' ingredient list, but so far seems to have escaped notice by the trial lawyers.
I love me a tall, cold glass of milk, whether it's whole, 2%, or even skim, but I can already feel my throat constricting when I think of drinking milk-water, no matter what kind of additives it has in it. I think WhiteWave would have a hard time trying to milk this beverage for sales.
Fool contributor Rich Duprey owns shares of Dean Foods and WhiteWave Foods. The Motley Fool owns shares of Dean Foods Company and WhiteWave Foods. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.