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The potassium citrate in American cheese helps real cheese melt better. You can achieve the same result with sodium citrate and an immersion blender, but not everyone has easy access to or storage for yet another spice.
I have never had any trouble melting actual cheese though when required. I have no idea what kind of scenario this kind of cheese product would be superior.
Many hard cheeses (think parmesan) and even some cheddar cheese aged for more than 6 months don't create a silky emulsion without some help.
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