Struggling Local Commercial Dairies

by Catherine Haug

September 27 update: The Daily Interlake featured this local dairy in today’s Sunday Paper: Milky Way. This article included some new information:

  • The new dairy will be called “Kalispell Kreamery;”
  • They will sell pasteurized, non-homogenized milk, cottage cheese, and ice cream in local stores, as well as at the dairy.

Our two local commercial dairies in the Flathead Valley are struggling, and it can’t all be blamed on the down economy.  Or at least that’s the message in a recent article in the Flathead Beacon: The Flathead’s Last Dairy Farms.

At one time, there were over 25 dairy farms in the valley, and all sold their milk to locally owned processing facilities such as Skyline and Glacier. But consolidation that was rampant throughout American business world also affected dairies.  One by one, these processing facilities folded, and along with them, many of the dairy farms pulled up stakes, selling their land to developers. Only one processing plant and two dairy farms remained.

Until a year ago, our two dairy farms sold their milk to Skyline Dairy, which was eventually bought by Meadow Gold, a division of the national company Dean Foods. Then the local processing plant closed down and our dairies switched to selling their milk to a Bozeman Co-op Dairy, Country Classics.

Now the problem is that our dairy farmers, like their counterparts across the country, are struggling to make ends meet. From the Beacon article:

“Prices are set by the Montana State Milk Control Board, which makes some adjustments to the national rate set by the U.S. Department of Agriculture, which uses cheddar cheese futures on the Chicago Mercantile Exchange as a benchmark. It’s been months since the market price was high enough to pay the bills; according to the USDA, the local price would have to increase more than $5 to cover the average costs of running an American dairy farm. …

Farmers make less than $1 a gallon, according to the National Milk Producers Federation. In Montana, Bill [Hedstrom] puts the actual cost of a gallon of milk, including production and processing, at less than $1.50 [a gallon]. …

The reason for the steep decline in dairy profits is simple, analysts and farmers say: too much milk and not enough demand for it.”

Why is there a glut in milk supply? There’s two likely reasons: consumers are not buying as much milk as they used to; and, as dairyman Joe Brenneman is quoted in the article,

“If there’s one thing farmers do best, it’s if a commodity is doing well, we quickly produce too much.”

In the face of the current money-losing situation, one local dairy farmer is going local. Bill and Marilyn Hedstrom will no longer sell their milk to a distant processor. Instead, they invested in processing equipment and will sell their milk directly from their farm, doing business as Kalispell Kreamery. It will be available in local stores, or you can bring your jars to the farm and ‘fill ‘er up.’ You can inspect the facility, and meet the cows, too.

““I think people are ready to know their farmer again,” Marilyn said.”

While their milk isn’t Organic, they don’t use antibiotics or hormones. Their facility will be inspected regularly, just like other facilities in the state.  The milk will be pasteurized, but not ultrapasteurized (the method used for almost all milk available in stores), so some of the nutrient value will be retained. And it’s not homogenized, so the cream will be on the top.

In addition to milk, the dairy will also sell ice cream and cottage cheese.

Once you taste delicious, fresh, local milk, you and your family just might fall in love with milk all over again.

NOTE: for more on the types of pasteurization used with milk and other foods, see my essay on Food Safety & Pasteurization.

Benefits of Local Milk

Here’s a short list; I’ll bet you can think of even more:

  • The biggest benefit is freshness.  Instead of ultra-pasteurized milk that sat in a warehouse for weeks, before being trucked to your grocery, so that it is at least 30 days old, you get milk that came from the cow a day ago.
  • Every dollar you spend on any locally-produced product stays in the local community, providing more benefits than dollars removed to non-local coffers (for more, refer to my post Buy Local Flathead).
  • The success of local producers ensures availability of milk when grocer’s shelves are empty (because it is no longer cost-effective to truck foods into the area from distant producers). On the other hand, if our local dairy farmers go out of business, we will be forced to pay high prices for trucked-in milk, or do without.
  • Consuming locally-produced products such as milk builds community by encouraging interdependence with other community members.
  • Minimizes fuel use and CO2 emissions when local products are consumed (see also Entrepreneurial Opportunities, below).

Entrepreneurial Opportunities

Milk Delivery

It’s not very fuel efficient, if a lot of people chose to make the drive to Hedstrom’s farm for their milk; especially if their customer base includes the entire valley. This opens an opportunity for a new entrepreneurial endeavor that is catching on in more urban areas around our country:  Milk Delivery. See my related post: Local Dairy with Milk Delivery.

Butter, Yogurt or Cheese Maker

Typically, cows produce more milk than the community can consume as milk. When milk nears the end of its shelf life, there are two choices: toss it, or culture it. Consider culturing milk for a profit.



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