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Land O' Lakes CEO Beth Ford on record butter sales during pandemic and outlook

Land O' Lakes CEO Beth Ford says "we've seen this incredible amount of butter being sold... now we'll have to see if it extends passed the holidays."

Video Transcript

BETH FORD: Well, it's certainly elevated. You know, it's really interesting. We're stepping into November, December. That's normally a key season for the butter business, right, because that's normally when we're all baking and cooking and getting together. We've seen this incredible elevated amount of butter being sold and cheeses-- well, we have cheese business, et cetera-- since the start of this pandemic. And, you know, so do we see it staying elevated? Well, I'm really going to be interested in what that holiday season looks like. Normally if there's a surge, we're starting to see our order book is really quite full for October as we step into that filling of retail shelves. I think it'll stay elevated certainly towards the end of the year.

And then the question really goes to what is the reopening because a lot of dairy products are sold into food services, right-- bulk butter-type stuff? And so will there be a shift? How quickly does that open? What is that dynamic? I do expect that we'll continue to see elevated levels through the holiday season, and then we're going to see what the reopening plans look like in next year.

- How have you been keeping up with demand? What does this supply chain look like? I remember I went to the market not long ago looking for unsalted butter because I wanted to bake. There was only salted butter out there, and I had to wait a while. So what's it like keeping up with that demand?

BETH FORD: It has been really, really amazing. You know, it's not that there's not enough milk to make the butter, right? Milk production has been strong for dairy producers. But we are operating-- literally we had to reduce the variety of SKUs. You said salted-- that's interesting that you couldn't get unsalted. But we also have different types of butters that we put on the shelf. We had to pull back from those. We had to go to one particular case count for every retailer, like 36 versus 18, right, so that we could maximize production on our lines.

Oftentimes in the spring, which is the most productive for cows making milk-- it's called flush-- you make a bunch of butter and then you put it in your refrigerator for key season-- key season being November, December. Well, we've been selling everything, so there was no butter put up because everything was coming off the lines and going into retail stores. And so, you know, how is it-- well, we're maximizing production. We're reducing SKU variety. We're in a good position as we get into key season, but we're going to see how the year ends.