Successfully moving dairy products from farm to fork not only hinges on delivering fresh, high-quality milk to dairy plants, but also ensuring that every journey in the supply chain — milk collection, transportation, processing, packaging and distribution — is well thought out and coordinated.

Preventing food recalls and maintaining strict quality and safety standards also is an important part of the equation. According to the Washington, D.C.-based International Dairy Foods Association (IDFA), Americans consume around 655 pounds of dairy (milk, cheese, yogurt, butter, cottage cheese, and ice cream) per person each year.

Hence, the dairy industry has a massive demand to meet, one that relies on efficient, timely production and distribution. Behind every gallon of milk or block of cheese is a complex operation involving farmers, processors, transporters, and retailers.

With six years at Atlanta-based Americold, John DeAngelo, vice president of business development, agriculture, dairy and bakery, notes the dairy distribution market is shifting rather than contracting.

"While fluid milk volumes remain under pressure domestically, cheese, frozen products, and value-added dairy continue to grow, especially in export-driven channels," he explains. "In 2025, U.S. cheese exports rose roughly 20% year over year, reaching a record 1.35 billion pounds, with Mexico the largest destination.

"That growth is increasing demand for port-centric cold storage and integrated networks," DeAngelo continues. "Americold’s facilities near ports, rail hubs, and production centers help customers capture these opportunities while maintaining food safety, efficiency, and speed to market."

DeAngelo’s colleague, Annie Waring, director of key accounts, agriculture, dairy and bakery, notes that while dairy distribution is much more complex, it also is more flexible.

She explains: "As categories have shifted from fluid milk toward cheese, frozen, and cultured dairy, timelines are less singularly time critical and more strategically managed. This has elevated the importance of network design, inventory positioning, and cross border capability."

Additionally, Waring, a 12-year Americold employee, suggests that regulatory requirements and SKU proliferation have increased complexity.

"Today’s most effective distribution models are built around optionality — having the right cold storage, in the right locations, connected across production, transport, and end markets," she says.

Supply chain AI for dairy processors

Today’s supply chain for dairy distributors requires more data-driven analytics, warehouse automation, faster order fulfillment, software optimization, strong partnerships and artificial intelligence (AI) strategy and planning to confidently move products from Point A to Point B.

During the 2026 ADPI (American Dairy Products Institute) Annual Conference held April 26-28 in Chicago, a new innovation built specifically for dairy processors was unveiled by Ever.Ag: Everett. The Ag Decision Engine, an agentic AI system, is designed to turn raw operational data into actionable decisions directly within existing agricultural and food processing workflows, the company says.

"Everett brings together data from across your operation, continuously monitors performance, and applies built-in dairy expertise to help teams make faster, more confident decisions," explains Bob Nelson, director of Enterprise Sales for Ever.Ag.

Designed to work inside the Ever.Ag solutions already used by many dairy processors, "There’s no generic AI, no disconnected dashboards, and no starting from scratch," he adds.

Arriving first for dairy processing customers, Everett is available in three software suites:

• Cheese Yield Optimization
• Transportation Optimization
• Sales & Operational Planning (S&OP)

Ever.Ag has spent more than four decades digitizing data that helps food and agricultural companies make better day-to-day decisions. Since Ever.AG has deep roots in dairy, Everett provides a contextual advantage few can rival, says the company’s Chief Product Officer, Simon Drake.

"The intelligence lives inside the software the dairy teams are already working in — built specifically for their products and their operation," Drake says. "A dairy processor using Cheese Yield Optimization gets Everett, which already knows their product, their process, and what moves the needle on yield. That's genuinely difficult to replicate."

The introduction of Everett follows years of investment in AI and data science across Ever.Ag's platform, including the 2023 acquisition of Austin Data Labs, the team that helped pioneer AI for the global food and agricultural supply chain.

According to the company, Everett is the only technology partner operating across all domains of the agricultural supply chain: Production, Procurement, Transportation, Processing, and Markets & Risk.

Nelson adds: "Everett continuously evolves, delivering greater value the more it’s used. The data has always been there. The expertise has always been there. What's changed is the technology, and we're ready to harness it."

Everett's rollout is a continuous journey. Coming this summer, additional support will be announced for the dairy portfolio, as well as livestock and animal protein and agribusiness products.

Automation, racking systems aid distribution

Driven by the rapid transformation of global supply chains, the industrial racking system market is experiencing strong growth momentum, says London-based Persistence Market Research. Valued at $19.2 billion in 2026, the market is anticipated to grow at a compound annual growth rate (CAGR) of 8.7%, reaching $34.5 billion by 2033.

The expansion is due to many factors: storage density optimization, faster order fulfillment and the expansion of eCommerce, and the modernization and automation-ready infrastructure of modern warehouses.

"Industrial racking systems play a critical role in modern warehouses by supporting high-volume inventory handling, improving space utilization, and enabling seamless integration with advanced technologies such as robotics and warehouse management systems and automation," the report stated.

East Asia leads the market with 32% share, driven by strong manufacturing output, export logistics, and rapid warehouse automation adoption, while North America accounts for 27% share, supported by high eCommerce penetration and continuous warehouse modernization investments.

The research company reported that eCommerce fulfilment centers are the fastest-growing segment, fueled by rising online retail and demand for high-density, automation-ready storage systems.

Refrigerated transportation maintains product integrity

Americold’s Waring suggests that traceability and digital tools such as radio-frequency identification (RFID), GPS-enabled transport, AI, automation and warehouse management systems are "foundational" to modern dairy distribution.

"Warehouse management systems, automation, and data analytics support food safety, compliance, and consistency," she explains. "The goal is actionable visibility, knowing where a product is, its condition, and how quickly it can move. When integrated across a network, these tools help make dairy distribution safer, faster, and more predictable, especially in multi-temperature and cross-border environments."

Unlike distributing pallets of soda or bottles of water, transporting ice cream, yogurt, cottage cheese and milk require cold-chain distribution that carries higher costs than moving shelf-stable products.

Yet, "the cost of failure is far greater, including product loss, regulatory exposure and brand damage," Waring notes.

"Cold chain distribution exists to protect product quality and integrity. Dairy products require precise temperature control from chill to deep freeze through storage and transportation," she says. "For dairy processors, cold chain precision is essential to protecting product value and customer trust."

Labor shortages, high fuel costs, tariffs, food safety, regulatory compliance and network reliability are among the ongoing pressures impacting dairy distribution.

The Top 3 challenges, according to Americold’s Waring, are: labor availability, food safety and regulatory compliance, and network reliability.

"Yet, each [challenge] is driving operational progress," she notes. "Labor constraints are accelerating investments in automation and standardized operating disciplines. Rising food safety expectations are pushing tighter controls and better traceability across multiple temperature zones.

"Meanwhile, transportation volatility has shifted the focus from lowest cost to reliability, redundancy, and continuity," Waring continues. "As a result, dairy processors are prioritizing partners with the scale, systems, and expertise to manage risk and keep product moving predictably."

In addition to finding reliable partners, Americold’s DeAngelo suggests dairy processors take a hard look at infrastructure — not just capacity, but where and how it’s deployed.

To overcome challenges, "Dairy processors are reducing handoffs, consolidating shipments, and rethinking network configurations," DeAngelo notes. "Americold has invested in facilities at key intersections of rail, port, and production, including import export hubs with onsite USDA and SENASICA inspection capabilities.

"Our Kansas City operation, supported by a unique CPKC partnership, and our upcoming Port Saint John facility are designed to move dairy efficiently across the U.S., Canada, and Mexico within a single, integrated network," he adds.

A credible supply chain

Dairy processors seeking a strong distribution system and a resilient dairy supply chain should embrace strong partnerships and a thoughtful network design that includes redundancy, contingency planning, and the ability to operate across multiple temperature zones and regulatory environments, according to Waring and DeAngelo.

Waring stresses the importance of partners with broad networks and deep operational expertise. "Partners that can support growth, manage disruption, and ensure continuity as markets and demand patterns evolve," she says.

DeAngelo concurs: "Innovation in dairy distribution is increasingly practical and purpose driven. It includes automation and facility design, but also consolidation, deeper freeze capabilities, safer work environments, and re-engineered networks that reduce complexity and risk."

Communication and investments in employee safety and safer operations are critical. "At the same time, customers are seeking better visibility, which is why Americold is rolling out a new customer portal that provides real-time insight into inventory, product movement, and service performance," he says.

"Dairy distribution works best when integrated into production and go to market strategy. Americold supports customers across the full lifecycle from pre- and post-production storage to retail, foodservice, and export distribution," DeAngelo concludes. "As product mixes and trade flows evolve, access to a well-positioned, connected cold chain network becomes a competitive advantage. Our role is to help customers protect product, manage risk, and scale with confidence."