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Land & Lakes owner Dean Foods filed for bankruptcy



The 94-year-old company has struggled in recent years as Americans drink smaller cows of milk. 2019 has been particularly brutal: the company's sales fell 7% in the first half of the year and profit fell by 14%. Dean Foods ( DF ) stock has lost 80% this year

The company, which makes some of the country's most famous milk and dairy products, including Dairy Pur, Organic Valley and Land O & # 39; Lakes has signposted its fighters on the "accelerated decline in the conventional white milk category."

The company is tangled with debt and has not been able to finance all of its workers' pensions. So on Tuesday, Dean Foods filed for Chapter 1

1 bankruptcy protection to keep the business running, reorganize its debt and help fund the pensions while it appears to sell the company.

Dean Foods said in a statement that it is working with the dairy Farmers of America cooperative for a potential agreement, where the cooperative would buy almost the entire company.
As part of the bankruptcy process, the company received $ 850 million in funding from its existing lenders, including Rabobank [19659002] ( RSWLDD ) to keep the company going.

When an American fridge has a staple, the milk has slowly fallen out of favor with consumers as they search for less sugar- or plant-based alternatives.

The global market for milk alternatives is expected to top $ 18 billion this year, up 3.5% from 2018, according to Euromonitor. It is still a fraction of the traditional milk market that will come in at just under $ 120 billion globally this year.

Sales of cow's milk have decreased over the past four years. Sales over the past 52 weeks, ending October 26, were about $ 12 billion, according to data Nielsen provided to CNN Business. This is a decrease from USD 15 billion over a similar period in 2015. All types of cow's milk, for example 1%, 2%, foam and fat-free milk sales have all decreased.

In contrast, and while still much smaller, oat milk sales have jumped 636% to $ 53 million over the past year.

That's not the only problem Dean Foods has faced. Walmart ( WMT ) who was one of Dean Food's largest customers, dropped them last year after building their own dairy.

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