How to Use Powdered Milk to Save Money

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Heather says:

The ideas in this post may not be of immediate use for you. Many of you will say, it would take more time than the savings provide. That may be true for where you are today, but you never know what information you may need in the future. Just mentally file it away for reference.

Regardless of cost, powdered milk should be a part of your emergency pantry. It really doesn’t matter whether the emergency is caused by a personal crisis like a job loss or a national disaster. There might be zombies wreaking havoc outside, but by golly no one is getting rickets on my watch.

There is a big difference between nonfat instant dry milk and whole dry milk. The fat in whole dry milk can go rancid quickly, making storage impractical.

Nonfat instant dry milk has a shelf life of approximately one year, there will be a slight degradation in taste and nutrition after this time, but it’s not dangerous to consume. Dry milk should be stored in a cool, dry, dark place. Both vitamins A & D break down with exposure to light, keep this in mind if you choose to divide a large box of dry milk into smaller quantities.

How much money can you save using powdered milk?

It depends. Just like regular milk, the price of dry milk fluctuates, but having several boxes in the pantry can offset the occasional, temporary price spike.

Since powdered milk is cheaper to ship and store, the price difference can really become dramatic when oil prices increase. If however grain has a price spike, both powdered milk and fresh milk will experience an increase due the cost of feeding dairy cattle.

Prices are as of November 16, 2010, they will be updated quarterly.

Currently I can buy a 640z or 4lb box of non-fat dry milk for $15.63. The box of dry milk is the equivalent of 5 gallons of milk after it’s reconstituted effectively costing $3.13 per gallon.  Right now a gallon of milk is currently running between $3.75 and $4.22 a gallon.

At this time, each box of nonfat instant dry milk represents about $3.10 in savings.

Yes Heather, we get that, but powdered milk is disgusting to drink.

I tend to agree, which is why we don’t drink dry milk as part of our daily diet. In an emergency we’d switch.

Do not expect to make an immediate conversion from drinking fresh, whole milk to reconstituted milk overnight without a mutiny. It’s not the same thing.

If your food budget is extremely tight, a gallon of whole milk can be stretched with nonfat instant dry milk. For best results, use a 50:50 ratio of whole milk and reconstituted milk. You’ll need to mix the two in a clean, empty gallon jug. (2 quarts each, shake well, and keep very cold)

But what about right now, how can I save some money with powdered milk?

To save money with instant dry milk, use it for cooking.

It’s a straight substitution with reconstituted dry milk and regular milk in recipes.

When building a food pantry, it often makes more sense to purchase ingredients in bulk rather than single servings of convenience items. Use the following recipes to reduce the variety of items you need to store in your pantry, while saving money.


A generic label, 14 oz can of sweetened condensed milk is $1.99. You can make your own sweetened condensed milk with $0.59 worth of dry milk and $0.46 of other pantry staples.

Sweetened Condensed Milk Recipe

Equivalent to 14oz can, generic label =$1.99

  • 1/2 cup water
  • 1 cup sugar  ($0.22)
  • 3 TBSP butter ($0.24)
  • 1 cup nonfat instant dry milk powder ($0.5)
  • dash salt

Briskly whisk the ingredients together and bring to a full boil (start over low heat and gradually increase). Remove from heat and allow to cool before use or storage.

Evaporated Milk Recipe

Equivalent to 12oz can, generic label = $0.84

  • 1 1/3 cups water
  • 1 cup nonfat instant dry milk ($0.59)

Place the ingredients in a jar with a tight fitting lid and shake vigorously.

Hot Chocolate Mix Recipe

Use 2 – 3 TBSPs in place of a single packet of hot chocolate mix

  • 2 cups nonfat instant dry milk
  • 3/4 cup sugar
  • 1/2 cup unsweetened cocoa
  • 1 tsp salt

Mix thoroughly.

If you toss in mini-marshmallows, put it in a cute, glass jar with a label, this makes a great, inexpensive Christmas gift.

Did you know you can also make your own cottage cheese with nonfat instant dry milk? I’m going to experiment with that this week. If it works well, I’ll add the recipe here. Have you tried it?

Do you personally use powdered milk, whether as part of an emergency pantry or to cut costs in the kitchen?

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32 thoughts on “How to Use Powdered Milk to Save Money”

  1. I get that powdered milk can save money, and is also a pantry essential.

    The problem I have is that I am allergic to dairy products and my husband and 2 of my kids are lactose intolerant. As a result, powdered milk is a bit of a no-no in my kitchen along with other dairy products.

    Any suggestions as to a cost effective substitute that keeps well?

    UHT cartons of dairy free milk alternatives (soy milk, almond milk, rice milk etc) cost a small fortune and take up space. They also tend to taste pretty disgusting.

  2. When we were growing up money was very tight. It was a common paractice to mix a gallon of whole milk with a gallon or 1/2 gallon of powdered milk. Made a couple of hours before serving. Shook before pouring. And you're right- Kept very cold.

  3. I just bought a box of powdered milk for a recipe I want to try. Normally I don't keep it in stock. The milk drinkers in my house wouldn't dream of drinking powdered. But I'd easily use it in recipes where it's less noticeable. And thanks for the sweetened condensed and evaporated milk recipes. I can never seem to use those cans up before they go bad.

    I think I remember reading that reconstituted powdered milk tastes best several hours after it's mixed and needs to be cold. The advice was in Amy Dacyczyn's "The Tightwad Gazette."

  4. Some people may not know you can replace some/all of the WIC milk you get (if you are able to qualify for WIC) with dry milk. I use powdered dry milk to up the protein content in the home made yogurt that I make and also to make it thicker and "richer". Home made yogurt is much less expensive than the store bought tubs, even the store-brand large ones.

  5. I wrote an article about getting your kids to drink powdered milk:

    It tastes best very cold, and after it's set for a few hours so it can blend and mellow.

    As for milk alternatives that are shelf stable, have you tried oat milk? It doesn't taste like much of anything so it's good for recipes that call for milk but have other ingredients, or smoothies.

    It's easy enough to make – use a flour mill, coffee grinder and grind oats into powder. Add twice as much water as oats, stir to mix. In a pinch, you can just "steep" oats in water, then strain but grinding them makes it thicker and more "milky".

    Or you can add a little water to a good blender, then add a steady stream of the oats to grind them. The liquid helps keep things moving. Then add the rest of the water. I have a Vitamix and do this to grind brown rice and oats all the time, but cooked oatmeal will trash a regular blender. I use my blender to grind the grains to make this recipe- she has pictures of the technique:

    If you want it thinner, just strain it. Pour the slurry in a colander lined with a coffee filter to get rid of the solids.

    You can use the same technique to make rice milk – use DRY rice, grind it up, add water.

    It keeps well- because you are storing dry oats and dry rice and mixing it up as needed.

  6. I use powdered milk from time to time. I mostly use milk in coffee and for cooking, so this works well for me. I have noticed that reconstituted powdered milk sours sooner than fresh (because it's not in a sterile container, and nonfat milk always goes bad sooner than whole or 2% anyway). Therefore I have started mixing it in pints rather than quarts – since I live alone, I don't need that much milk at any given time. This takes a bit of fancy measuring but it works just fine. If in doubt, I'll err on the side of adding a little extra powder.

    Speaking of milk, you can freeze fresh milk… just in case anyone didn't know. My folks do this when they travel, so as not to waste the milk. Just put the frozen carton back in the fridge to thaw out. Make sure you have removed some of the milk from the jug or carton prior to freezing, so as not to rupture the carton!

  7. I've been looking for a good hot chocolate mix recipe! The last one I tried turned out kinda bitter, but I hate all the fake food they put in the store bought brands…

    • Here's my recipe:
      6 c. powdered milk
      2 c. powdered sugar
      1 c. cocoa powder

      I like my chocolate a little "dark" – adjust the sugar to taste. Just mix up a batch, then make 1 serving of hot cocoa from it, and see how you like it. make it more chocolatey or more sweet, however you like it.

      The hot cocoa mix jar is an excellent place to put broken candy canes 🙂

  8. I have an offbeat use for you. Probably good for when your powdered milk is about to go stale. I put powdered milk in a nice hot bath tub. The result is a luscious spa treatment for pennies! Add cocoa powder for a hot chocolate bath. They charge a few hundred for that in Hershey!

  9. I always use it in cooking – works great and I can make it thicker and richer by just upping the powder ratio. I hate milk, so when my kids are at their dad's house I never buy it, but lots of recipes call for it. I make homemade cocoa with powdered milk all the time. I mix the dry ingredients together – sugar, cocoa, milk powder, salt – then I can just add hot water and a touch of vanilla extract. Yummy and super quick and easy.

  10. I use powdered milk because I am not a milk drinker (I use vanilla soy) and cannot get through much before it goes bad. Powdered milk works excellent in recipes for me and I don't waste any milk (or money!). I'll have to try the hot chocolate and sweetened condensed milk recipes you provided!

  11. Has anyone tried powdered milk in cream-soup recipes? I love to make homemade cream of potato, cream of broccoli, etc, but it can get expensive. However, the thought of using reconstituted powdered milk to make soup just sounds less-than-appetizing to me. Any input?

  12. A few years ago we came across the Hillbilly Housewife's recipe for magic milkshakes. So yummy and the kids love them. We sub in coconut oil instead of corn oil. Great way to use powdered milk.

    1-1/2 to 2 cups ice water
    1-1/2 cups nonfat dry milk powder
    2/3 cup sugar
    1/4 cup unsweetened cocoa
    1 teaspoon vanilla
    1 to 1-1/2 trays of ice cubes, as much as you can spare
    2 tablespoons corn oil plus a 5-second squirt of non-stick spray for emulsification purposes
    Place all of the ingredients into the blender, including the oil and the non-stick spray. Use less water for thicker milk shakes and more water for shakes that are easy on your blender motor. The blender should be about 3/4’s full. Place the lid on. Process for a full 2 minutes. Pour into cups and serve. Makes 4 – 12oz servings. For preparation tips please see below.

    • I've seen this recipe, but I have never tried it. For some reason it skeeves me out a little bit although I suppose it is no different from a Frosty from Wendys.
      I don't mind oil in cooked foods or in dressings, it's just a mental thing for me.
      I'm sure it tastes great.
      I need to get a blender.
      Are you listening, Santa?

      • Well you could skip the oil if you wanted to — or sub something that you're more comfortable with — coconut oil? Flaxseed oil? I think it has something to do with mouth feel.

    • I have always made my cream-type soups with powdered milk and I always get rave reviews! I use the butter/flour/milk method like Milehimama.

  13. Katie, I misunderstood what you meant. I use it all the time for bechamel, or white sauce that i use in place of cream of mushroom / chicken / celery soup. The link is below the post in the footer. 🙂 How to make bechamel.

  14. I've had the sweetened condensed milk recipe for years, though I got away from using it… However, be aware that it does not work in recipes that are not baked! If it is a "mix, heat on the stove and put in a pan and chill" type recipe, it will not set.

    • Pam, great point. Except for the Christmas season, I don't make many sweets. My favorite use for sweetened condensed milk is rice pudding, or 'spuddin' rice as my kids dubbed it years ago. 🙂

  15. I am just stuck on the fact that your milk is so expensive! Our milk is only 2.39 a gallon! It actually just went up from 2.19 to 2.39 & I was complaining. I guess I won't anymore :-). Of course, supposedly our gas prices are higher than almost anyone's, so there is always a trade off 🙂

  16. I got this recipe for chocolate pudding mix from the Boston Globe website. If there are chocolate pudding lovers in your household this is not a bad little recipe to have. __The basic mix is 1 1/3 cups (3.2 ounce packet) nonfat dry milk, 1/2 C. unsweetened cocoa powder, 1/2 C. sugar, 1/3 C. cornstarch and 1/4 tsp salt. Mix and store in airtight container. __Then for two servings use 1/2 C. of the mix, 1 C. cold water, 1/4 tsp vanilla extract. Combine the mix and water in a small saucepan and cook over medium heat, stirring constantly, till it comes to a boil and then continue cooking another 30 seconds. Take it off the heat and add the vanilla (and a few optional chocolate chips, if you want). __Place plastic wrap on top to prevent a skin from forming – me, I love pudding skin, but maybe I'm weird. Cool for 15 minutes till room temp and then spoon into individual bowls if you want, refrigerate for at least an hour.__And I have to say Heather, "By golly, nobody is getting rickets on my watch" is maybe your best line ever. 🙂

  17. A great place to get powdered milk in bulk is Honeyville Grains ( I signed up for their email updates and waited until they had a sale to order. I got a case of milk– 144 quarts = 36 gallons for $60.00. That is about $1.67 a gallon. I find that I use it a lot since I have so much on hand and why not at the price vs. store bought milk. I use it in cooking and will mix it with 2% and my family doesn't know the difference. Shhh…..don't tell them.

  18. Sorry for necro posting, but I have a dry milk recipe my kids love, and really give a big protein punch.

    1 cup creamy peanut butter
    1 cup dry milk
    1 Tbsp sugar
    (optional) 1/3 hot cocoa mix for chocolatey flavor

    Mix ingredients into a dough like texture. roll into 1/2 – 2/3 inch balls.
    Roll balls in additional dry milk to prevent that oily feeling when handling.

    My kids love to eat Peanut butter balls. They are also really good for pregnant woman that are having trouble maintaining proper weight.


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