From Chobani to Fage, Greek Yogurt Dominates

The Recorder, September 7th, 2015, by Richie Davis

Greece’s economy may be hurting, but Greek yogurt is booming.

Over the past five years, the thicker brand of yogurt has increasingly dominated supermarket dairy cases, in some instances expanding the size of those cases as shoppers have to choose between Dannon Oikos, Chobani Flip and Chobani Indulgent — and a whole lot more.

“For nearly a decade, Greek and Greek-style yogurt has been the driving force behind growth in the yogurt and yogurt drink market in the U.S.,” the food market research firm Packaged Facts reported earlier this year. “Today, Greek yogurt commands a 50 percent share of the yogurt market in this country, a remarkable rise since 2007, when the products were a niche category within the overall market. Today consumers are hard-pressed to find traditional yogurt products on supermarket shelves.”

Much of the Greek yogurt craze is traced back to Hamdi Ulukaya, a Turkish cheese maker in New York state who at 34 seized the opportunity in 2005 to buy an old Kraft yogurt and cheese factory in central New York and tried to popularize the thick yogurt he recalled his father making back home. He named his product Chobani, based on the Turkish word for shepherd.

In its first five years, sales of Chobani had reached $1 billion, and its name became synonymous with Greek yogurt, the thick style of yogurt in which water and liquid whey have been removed either by a strainer or a centrifuge. Although the Greek brand Fage (pronounced Fa-yeh) had begun selling its product in this country a few years earlier from a Johnstown, N.Y., factory, as had even the farmer-owned Cabot dairy cooperative, it was Chobani that spoke Greek to many yogurt lovers.
As a dairy buyer for the owner of the Stop & Shop supermarket chain at the time, Thomas Moffitt remembers being invited to visit the Chobani factory after first rejecting the brand.

“They wanted to put Chobani into Stop & Shop, and we said ‘no.’ We had Fage, and we were throwing away more than we were selling. It was $2.50 for a little cup.”

Moffitt, whose favorite yogurt at the time was strawberry Yoplait light, was offered his first taste of Chobani blueberry, “And I remember thinking, ‘Oh my god! Wow! That’s freakin’ great!’ because it was like ice cream. It was thick, it was rich, it was creamy, it was an excellent source of protein and high in calcium compared to regular yogurt.”

Moffitt, who decided at that point that he needed quit his job and go into the yogurt-making business, homed in on the thicker variety before his Commonwealth Dairy co-packing factory was built in 2011, because a Greek yogurt had become an empire.

“We put in a Greek separator thinking it would be a niche item, like a door-opener for us. Lo and behold, by the time we opened, Greek had gone from niche item to mainstream. Before we even opened the plant, we were getting calls from all largest retailers in the country saying, ‘We heard you guys are able to make strained Greek yogurt!’ That trend has just continued, and it’s competitive.

“In the past three years, literally every month, I learn about a new (Greek yogurt) plant that’s opening, There have been four or five in New York state just since we opened this plant.”

The reason for what Moffitt calls the Greek tsunami is that “Americans love stuff that tastes great and they can say is good for you.”

For dieters, there’s the added benefit that Greek yogurt — with as much as 23 grams of protein per serving — can fill you up without a load of fat. And, Moffitt added, since American consumers were already accustomed to yogurt, the Greek-accented variety wasn’t that much of a change to get used to.

“It was just a matter giving people samples, and getting people to try it. Once they tried it, they were hooked.”

Since Greek yogurt also contains five times as much milk as conventional yogurt, according to Moffitt, it also should delight dairy farmers.
Greek yogurt has worked well also for Cabot Creamery, known primarily for the cheese it produces for the 1,200 farmer member of the Agri-Mark dairy cooperative that represents 75 dairy producers.

Cabot has been making yogurt since the 1950s, but launched its Cabot Greek yogurt in 2007. It still sells a traditional, nonfat plain yogurt, but most of its offerings — all in large 32-ounce containers — are Greek-style: full-fat, lowfat, vanilla bean and strawberry.

“Greek has really come on strong in the last few years,” said Cabot spokesman Nate Formalarie.

(Unlike many Greek yogurt makers, Cabot doesn’t strain or use a centrifuge, instead using whey protein concentrate and milk protein concentrate from its cheesemaking operation to thicken and add protein.)

With sales of Greek yogurt this past year up 5.7 percent overall, Cabot’s Greek yogurt sales were up 9.6 percent, largely because there has been a higher growth rate for large-container Greek yogurt sales.

“I think people like Greek yogurt because it’s got more protein, and it’s a creamier, thicker yogurt, that’s attractive to people as well in terms of texture. People have really taken to it.”

Although the prices paid to farmers for their milk sold as fluid milk is the highest category, the Class 2 price paid for cultured products including yogurt is higher than that paid for the milk that goes into cheese, butter or powdered milk. Especially at a time of an oversupply of milk in the market, Formalarie said, “It’s a good product that delivers a good return for our farmer owners.”

Paul Lacinski and Amy Klippenstein own SideHill Farm in Hawley, which produces a popular traditional (non-Greek) yogurt. After getting requests for Greek yogurt over the years, they tried making batches of it using giant pieces of cheese cloth to filter out the whey. But they ultimately came up against the realization that not only they not do everything; they didn’t really want to.

“The thing about Greek yogurt is it’s very heavy-bodied and dense, you can eat a nonfat product and it feels like you’re eating cottage cheese, or something very dense and fatty,” adds Klippenstein. “And it’s filling. You don’t feel like you’re eating diet food.”

But the cost of a centrifuge was way out of the couple’s price range, and they didn’t even know where in the semi-trailer that was their initial processing plant they would fit the additional piece of equipment.

Then a friend, who watches the food industry really closely, told them about two years ago that “the ‘Greek yogurt thing’ had broken,” recalls Klippenstein. “People are less fired up about Greek yogurt. … We don’t get as many requests from people for it.”

With the market for Greek yogurt seen as maturing in this country, manufacturers are looking at news ways of broadening the appeal with marketing add-ons like a side cup of nuts and seeds, or like U.S. Department of Agriculture’s announced plans to make Greek yogurt a permanent part of its national school lunch program as a meat alternative beginning this year, according to the food marketing research firm Packaged Facts, as a way of boosting protein offerings.

Locally, Klippenstein says, “For a while everybody was jumping on the bandwagon making Greek yogurt. But we realized that Greek yogurt and the kind we make are fundamentally two different foods. That’s just the way it is. Let somebody else do that.”

You can reach Richie Davis at: rdavis@recorder.com or 413-772-0261, ext. 269