EAST EARL, Pa. — Shortly after the Whole Milk for Healthy Kids Act became law in January, Teri Gamez surveyed her high school students at the Ephrata Area School District in Lancaster County, Pennsylvania. She has served as school foodservice director for 19 years after starting her career in the restaurant industry.

Asked which milk they would choose, most selected whole milk. “I’ll be darned,” she recalls thinking.

That local result mirrors the national trend.

The USDA Economic Research Service recently put out a ‘Charts of Note’ report on fluid milk sales, showing whole milk’s share was leading the category at around 34% in the early 2000s, then dropped below 30% in 2010, to a low of 26% in 2012, before rising to 39% by 2024.

According to available USDA AMS monthly estimates for the first four months of 2026, whole milk’s share jumped to 43%, while overall fluid milk sales have stabilized — steady vs. prior year.

This is significant and would include at least some whole milk sales in schools as federal policy caught up to preferences in January, amid changing views on dairy fat.

The trend began in 2014 after Dr. Nina Teicholz sounded the alarm with her revealing book: Big Fat Surprise. The international bestseller named Best Book by The Economist, Wall Street Journal, Forbes, and others, brought new research to the forefront. It also dug back into research buried in the 1970s and 80s, when Minnesota researcher Dr. Ancel Keys and his 7-countries study were celebrated.

By the late 1990s, the Dietary Guidelines were doubling-down on saturated fat limits for children. The 2010 Healthy Hunger Free Kids Act etched them into stone for schools and daycares, though no studies on children had been conducted.

American Farm Bureau Economist Danny Munch observed last year in a Market Intel published in FARMSHINE Nov. 7, that the decline in overall fluid milk consumption accelerated when restrictions on school milk fat began. Average weekly school consumption fell from 4.03 cartons per student in 2008 to 3.39 in 2018, with the rate of decline increasing by 77%.

New law, new guidance

Munch concluded that restoring student choice could help slow or reverse the trend, but the transition would be gradual as the new law is “permissive, not mandatory.”

USDA delivered the lunch guidance on Jan. 14, and extended it on May 8 to cover all school meals, all childhood nutrition programs, including child and senior care.

However, implementation depends on a combination of school requests, supplier availability, packaging flexibility, school budgets, and contracts. Processors determine which products are formulated, packaged, offered, and priced for the school market.

Students respond

At Ephrata Area School District, Gamez explained in a June FARMSHINE phone interview that the high school had previously received a Chef Ann Foundation grant to install a bulk cold milk dispenser. They had already shifted from cartons to plastic bottles, but their supplier Swiss Premium offered only fat-free chocolate in bottles.

The new dispenser allowed Gamez to get the 1% chocolate milk in bulk bags from Swiss. “It was awesome,” she said, noting the students didn’t like the fat-free chocolate milk. At first it was stocked with both 1% chocolate milk that was moving and 1% white milk that was not. Eventually, she devoted the dispenser entirely to 1% chocolate, offering 1% white in plastic bottles.

Once whole milk was permitted, and with the student survey in-hand, Gamez switched the dispenser to whole white milk alongside 1% chocolate. “They were taking the whole white milk better than the 1% white milk,” she reported.

Whole chocolate

Although schools may also serve whole flavored milk under the new law, USDA nutrition standards limit flavored milk served with school meals to 10 grams of added sugar per 8-ounce serving. Middle and high school a la carte sales are limited to 15 grams per 12 fluid ounces. These rules, effective 2025-26, were developed under former Ag Secretary Tom Vilsack.

Processors have reformulated fat-free (and in some cases 1%) flavored milk to comply, but many have not yet done so for whole chocolate milk, and a 2% flavored option is not commonly offered even at retail.

Gamez said the whole chocolate milk made by her supplier is just one gram over the limit. “If they fix the whole chocolate milk issue, we’ll probably do whole white and whole chocolate in the dispenser,” she said.

Similar sentiment surfaced in neighboring Lebanon County. Retiring ELCO School District Superintendent Julia Vicente told FARMSHINE her foodservice director moved quickly to introduce whole white milk after the law changed.

“We told Swiss, we want that whole chocolate milk ready for next year too,” Vicente said.

Packaging hurdles

During the second half of last school year, some Pennsylvania districts with bids based on cartons were told whole milk was available only in plastic bottles. Others that had converted to bottles were told the opposite.

Some schools in Pennsylvania and around the country reported price upcharges of 8 to 13 cents per half-pint, even though the regulated difference in the higher-fat milk value is just 1 to 2 cents, and bulk dispensers can reduce costs further.

In other states, schools have reported switching to single-serve milk pouches with juice-box style straws to access whole milk from different suppliers.

Gamez said Swiss had no difficulty last year supplying whole white milk and 1% chocolate in bulk bags used in the dispenser at the high school. However, for plastic bottles, the available fat-levels were limited to fat-free chocolate and 1% white — the products previously permitted under federal regulation.

She has organized a survey of Pennsylvania districts using plastic bottles to encourage Swiss and other processors to expand their bottled product lineup. She would like to see higher-fat chocolate milk and the whole white milk options in plastic bottles because dispensers are not practical at all buildings.

“I’m trying to avoid going back to cardboard,” she said. “I really like my bottles.”

Procurement matters

Schools can only buy products that suppliers will quote, and suppliers can only quote products they are asked to quote, and if they choose to make them available.

Unlike many products the schools purchase, milk prices are not fixed for an entire school year. In Pennsylvania, for example, the Milk Board sets minimum monthly retail prices by package size, and these are tied to federal milk pricing formulas that change monthly, along with the annual cost-recovery hearings for packaging, service, etc.

As underlying milk values change, so does the price of the milk inside the package. What schools are comparing are the charges for processing, delivery, service, and in some cases packaging, as well as which products the supplier is willing to offer.

Before contracts are awarded, school nutrition directors identify the milk products and packaging type they want priced — whole, 2%, 1%, flavored, unflavored milk, cartons, plastic bottles, pouches, bulk dispenser bags, etc.

Processors then respond with prices and availability. If whole milk or a preferred package type isn’t included in the specifications, processors may never quote it. Conversely, when districts request certain products, suppliers receive a clear market signal but still decide what specs to actually quote.

The relatively small difference in the value of the milk itself also helps explain why some school boards and administrators have had sticker-shock, questioning the extreme upcharges for whole milk not based on the reality of the fat-level difference but reflecting processor distribution or product-line decisions.

At Ephrata, Gamez does not conduct a formal competitive bid. Instead, she solicits three price quotes from suppliers using a spreadsheet listing every milk type the district wants priced.

This year, for the first time, whole white milk — and likely whole chocolate if it is reformulated to meet the added-sugar requirements — are included in those specifications. She also specifies plastic bottles, which narrows down the processor options. The choices are wider for bulk bags for dispensers.

Speaking with Gamez just after the last day of the 2025-26 school year, she said she has not seen a noticeable increase in the cost of the bulk whole milk used in the high school dispenser and will learn what, if any, price difference (or availability) may exist for the higher-fat bottled milk once this year’s quotes are returned.

The situation extends beyond Pennsylvania. American Dairy Association North East (ADANE) works with 1800 schools in the region and reports many districts starting to receive processor bids and pricing. While whole and 2% milk may be included in bid requests, districts will make final decisions only after seeing the availability and cost.

Finding flexibility

Gamez said the bulk milk dispenser initially gave her more flexibility to offer the 1% chocolate (instead of fat-free) and later to offer the whole white milk at the high school, where the dispenser works well in the food court layout.

Her elementary and middle schools present challenges: Serving-line configurations leave little room for dispensers before checkout and are difficult to reach there for younger students, breakfast service depends on grab-and-go milk, and her middle school would require four separate dispensers to serve four lunch lines. She admits a grant opportunity would prompt a second look at how to make them work, especially if she can’t get quotes in bottles for what she wants.

Some schools, especially in the Southeast U.S., have successfully adapted dispensers with some innovation, but the approach is not a simple solution for every building or every district.

Proposed legislation in the Pennsylvania Senate (SB 1326 introduced by Sen. David Argall) and in the U.S. Congress (H.R. 9164 introduced by Rep. GT Thompson) would allow schools to use grants for bulk milk dispensers as well as refrigerated carts, coolers, and other equipment that fit existing cafeteria designs to revitalize cold milk service and flexibility in conjunction with the new choices permitted now by law.

Looking ahead

Munch estimates schools account for 7.5% of U.S. fluid milk sales. Even moderate adoption of whole milk would shift additional butterfat into Class I beverage milk. If one-quarter of schools offer whole milk, annual butterfat use could increase by 18 million pounds, with gains of 55 million pounds if adoption expands to three-quarters of schools, according to his estimates.

As Gamez’s student survey demonstrated, many young consumers had already made up their minds before federal policy caught up. The legislative battle to restore whole milk to schools may be over after more than a decade of diligent grassroots effort, but practical work has just begun within the industry itself to serve the young consumers in this market.

As districts finalize contracts for the coming school year, processor product lines, packaging choices, cafeteria layouts, procurement timelines, and realistic pricing will determine how quickly students gain access to the milk options they have already shown they want and are more likely to consume.