KANSAS CITY, MO. -- There was a time when getting milk from Point A to Point B was a relatively straightforward process. Before the advent of modern-day transportation options, developed in line with food safety practices, the need to maintain product at a certain temperature dictated those products not travel any further than a few miles.
Today, modern equipment and nationwide supply chain dynamics mean that dairy products routinely travel hundreds, and even thousands, of miles to their final destination. However, the process of moving milk remains time-sensitive, and dairy supply chain logistics are extremely complex.
The goal in dairy transportation logistics is to keep the product clean, cold and moving. There is a critical need to implement a process that creates a high standard for fresh products with a limited shelf-life.
There are a number of factors that need to be considered when dealing with dairy transportation. Dairy products are highly sensitive and even a short encounter in an extreme outside temperature can cause damage to the product. It is critical that the milk is moving at all times because of the high risk of spoilage.
“When working with a refrigerated product that’s as heavy as dairy, there is no room for compromising any safety standards for the sake of efficiencies,” said Lia McCarthy, logistics engineering team manager, Transervice, Lake Success, NY.
In 2010, the US Food and Drug Administration (FDA) granted the Food Safety and Modernization Act (FSMA) which allows the agency to mandate product recalls and established stricter requirements on sanitary transportation. This means that dairy transport logistics must place a heavy emphasis on the quality and safety of their product when it goes from the farm to the store.
As part of FSMA, facilities processing or packaging dairy require a food safety plan. Warehouses are not required to develop a food safety plan, but controls must still be in place to minimize the risk of contamination and spoilage. Modern tools and equipment can support the stringent standards needed for the cold chain management of dairy products.
The FSMA Sanitary Transportation Rule went into effect in 2016 and builds on safeguards established in the 2005 Sanitary Food Transportation Act. The rule regulates the transportation of human and animal food products to protect them from food-safety hazards during transport. It is intended to eliminate food safety risks, like improper refrigeration of food, inadequate cleaning of vehicles between loads and failure to properly protect food during transportation.
Many problems in the dairy supply chain can be combated with cool and cold temperatures when transporting goods from location to location. The best way to ensure a high-quality product arrives at its final destination is to utilize cold chain logistics. This stops any issues caused by unwanted or extreme weather conditions, thereby reducing potential wasted product and loss of profit.
Cold chain logistics rely on the ability to keep cargo temperature controlled. An unbroken cold chain means the product never warms above a certain temperature. Cold chain makes this possible, ensuring the safety and integrity of the product.
The global cold chain market size is estimated to be valued at $233.8 billion in 2020 and is projected to reach $340.3 billion by 2025, recording a CAGR of 7.8%, according to Research and Markets. The dairy and frozen dessert segment represents the largest portion of the cold chain market.
Factors, such as the consumer inclination toward food and beverages with higher shelf-life in order to mitigate food waste, have been fueling the use of cold chains in the food and beverage industry.
Refrigeration is the single most important factor in maintaining the safety of dairy. By law, Grade A milk must be maintained at a temperature of 45 degrees Fahrenheit or below. Bacteria in milk will grow minimally below 45 degrees, however, temperatures well below 40 degrees are necessary to protect the milk’s quality, according to research done by a team of food safety and dairy specialists at Clemson University College of Agriculture, Forestry and Life Sciences, Clemson, SC. It is critical that these temperatures be maintained through warehousing, distribution, delivery and storage.
Timetables also present risk, as different dairy products may have very different shelf lives. A gallon of milk may need to make it to the shelf within a few days, while a galloon of ice cream may have a longer window for safe transport. This can make transporting mixed dairy shipments complex.
All these risks should be taken into account at every step of the cold chain–typically through software specifically designed for the purpose–and accompanying controls should be implemented to prevent issues. Temperature monitoring and logging are two of the most obvious controls used to manage risk in the cold chain.
THE COVID EFFECT
It’s no secret that the dairy supply chain faced some serious hurdles at the onset of the COVID-19 pandemic in early 2020. The Dairy Farmers of America estimates 3.7 million gallons of milk were dumped every day in April 2020 due to breakdowns in distribution plans when many foodservice establishments closed down.
Food retailers and wholesalers have been uniquely positioned during much of the pandemic as part of critical infrastructure. Grocery stores were often some of the only retail locations permitted to remain open in the first weeks and months. Americans everywhere had to rely even more heavily on their local retailers to keep their families fed.
President Joe Biden prioritized examining the federal government’s response to the COVID-19 pandemic early in his presidency. Outlined in an Executive Order issued on Feb. 24, 2021, the president called for the Secretary of Agriculture to issue a report on supply chains for the production of agricultural commodities and food products. The US Department of Agriculture (USDA) followed in April with a request for comment, asking for public and private entities to submit “lessons learned” from the pandemic in order to enhance the government’s preparedness for and response to future emergencies.
The Cybersecurity and Infrastructure Security Agency’s (CISA) initial guidance regarding critical infrastructure served as a template for states and local governments during the first several weeks of the pandemic. In a blog written by Matthew Viohl, manager of labor policy and sustainability at FMI – The Food Industry Association, Arlington, Va., he explained that not only did these designations mean stores remained open after adopting safety procedures for customers and associates, but it also meant doing so for distribution operations.
“Waivers from agencies such as the Federal Motor Carrier Safety Administration were crucial in helping ensure truck drivers could continue delivering products vital to the health and well-being of Americans,” Viohl said. Rollouts for such things as hours-of-service waivers and extensions for expiring licenses and permits were extremely helpful, but federal and state agencies were challenged in implementing these extensions.
“Although we still face significant hurdles in returning to a pre-pandemic ‘normal,’ it is not too soon to start preparing for future crises,” Viohl said. “While it’s impossible to predict what that might look like, these past … months have equipped us with invaluable knowledge in planning for the unknown.”
Prior to the pandemic, the trucking industry as a whole was already facing a driver shortage. The effects of COVID-19 only exacerbated the problem.
“This is uncharted territory – we just didn’t know it was going to happen,” said Bob Costello, chief economist and senior vice president with the American Trucking Associations (ATA), Arlington, Va., on a recent episode of the Dairy Download podcast, produced by the International Dairy Food Association (IDFA). “If you go back to April and May (2021), the driver shortage went from roughly 62,000 in 2019 to probably zero for a couple of months and then it came rip roaring back. And while we haven’t quanified it since then – talking to my fleets, talking to my members – it is as bad as ever. “
Economists with ATA predict a shortage of more than 100,000 drivers nationwide by 2023.
“We have the structural issues and then we have the cyclical issues with the driver shortage and both are important,” Costello said. “The structural issues from the driver shortage stem from demographics and that is both gender and age. If you go to a truck driver training school and you look at the average person coming in to be trained, they’re over 30 years old, even though you only have to be 21 years old to drive interstate freight.”
According to ATA, the average age of a US truck driver is 50, while the average age of all American workers is 42.
Costello also attributes some of the shortage to the new US Commercial License Drug and Alcohol Clearinghouse, which went online in January 2020. The database identifies truckers with prior drug or alcohol violations or failed drug tests. Costello said thousands of drivers have been removed from the profession as a result.
COVID also caused driver training schools to shut down temporarily. Some students have not returned, while others are delayed in their progress, stemming the pipeline of new, qualified drivers.
“Truck driver training schools, because of social distancing issues, aren’t able to train as many drivers,” he said. “Most schools are down anywhere from 40 to 50% in terms of the number trained in 2020 versus 2019.
“The other limitation is the Department of Motor Vehicles in states have limited hours and days, so issuing a commercial learner’s permit, as well as a CDL, is really down quite a bit.”
Costello said the shortage is obvious based on the pay increases and pay minimum trucking companies are now offering. Companies are also pouring money into recruitment of new drivers.
“I get emails almost daily on fleets announcing that they’re raising pay, sign-on bonuses … all sorts of stuff to try to attract and retain drivers,” he said.
Costello said this driver shortage is contributing to higher freight rates. With fewer drivers, less capacity and surging demand that is 15 to 20% up on prior year levels. Nearly every good consumed in the United States is put on a truck at some point. As a result, the trucking industry hauled 72.5% of all freight transported in the United States in 2019, equating to 11.84 billion tons, according to the ATA.
“Trucking is so big and so diverse,” Costello said. “If you look at margins for fleets, they really haven’t improved very much and that’s because they’re having to take that money and they’re spending so much more on driver recruitment and retention.”