Proposed milk changes (STKL)
The USDA proposed to cut the SNAP Women, Infants, and Children (WIC) benefits for milk and dairy purchases. The WIC allotment for pregnant women would be cut by six quarts from 22 currently while children would see the amount reduced by two to four quarts to 12 to 14 quarts depending upon their age.
The USDA is also proposing to add more dairy-free options including soy yogurt, vegan cheese, and lactose-free dairy. Currently, the only dairy-free alternative is soymilk. There are six million mothers and young children in the WIC program. The dairy industry is contesting the proposed changes. The NIH estimates that 95% of Asian Americans, 60-80% of African Americans, and 50-80% of Hispanics are lactose intolerant and soymilk being the only dairy-free alternative is not based on the needs of the participants.
Starry launch (PEP)
Starry is a new brand of lemon-lime soda that is set to take on Sprite, the fourth-largest soda brand. The brand will launch in January in the food service channel. Sierra Mist has not had much success for PepsiCo. In the retail channel, Sierra Mist is almost non-existent with a market share below 0.1%. Management believes the lemon-lime category is a large opportunity for Generation Z consumers. Starry has a regular and zero-calorie version. The zero-calorie soda is sweetened with aspartame. Consider us skeptical that PepsiCo will commit the resources necessary to create a Sprite competitor from scratch.
World Cup spoils (BUD)
After Qatar reversed its World Cup alcohol ban Budweiser announced it would ship the excess beer to the winning country. Argentina began to receive free beer on Friday. Budweiser is giving away three 410 ml cans to each fan of legal age through its online platform. Budweiser has distribution points across the country for fans to pick up the beer. The cans are packaged in a special edition. AB InBev made the best of a difficult situation and may have come out ahead from a marketing perspective with a victory by Argentina instead of France.
