Iowa Public Television

 

Niche Dairy Finds Mainstream Market

posted on November 10, 2000


The most pervasive trend in agriculture is the steady drift of ownership into fewer hands. Farms are larger and fewer. Farm co-ops have chosen to merge to survive, as have rail and barge lines and food processors. Even the organic industry is beginning to mirror the structure of conventional agriculture.

For those who are surviving on the farm, it is not so much because of their farming practices as it is marketing.

With greater frequency, farm families recognize that their ability to connect with consumers directly is their best hope of sustaining their farms. A case in point, as David Miller found last summer, is a family that is shaping its own future, producing and marketing a raw commodity that for many is less than profitable.

It's just after sunrise at the Green Hills Harvest Dairy farm in northeastern Missouri near Purdin. The cows are working their way towards the barn. As they arrive in the milking parlor, they are tended by Kerry Buchmayer and his son Austin.

Today's workload will be greater than just milking the herd twice and getting the raw product into the bulk tank. Kerry, his wife Barb, and Austin will be processing and bottling 450 gallons of milk for direct sale to grocery stores in both Columbia and Kansas City, Missouri.

Kerry: Well, I think, the easy way to do it

would be to put it in a bulk tank and take what

somebody wants to give you for it but in order to really

make any money at that we felt as though we had to be

very, very large and we just didn't want to be a mass

producer of milk.

For eleven years the Buchmayer's ran a dairy farm in New York state. After growing tired of the high taxes and the cold weather they decided to move to Missouri. With the equity they had built in their New York operation they were able to buy 550 acres in the "show me state." But the prospect of continuing to just milk cows and sell the raw product was no longer enough to make all the work satisfying or profitable.

Barb: And I said, "No we've already been there, done that," I was the one that really wanted to process the milk and I felt that if we were going to process milk, we should start with the highest valued product that we could...

One competitive advantage the Buchmayer's feel their milk has over conventional dairy products is the fact that it is certified organic. None of the 45 jersey-cross cows receives antibiotic or hormone injections. And when the animals are not eating grass they are given certified organic grains.

By taking the organic route the Buchmayer's are able to charge a premium for their product. In a day and age when grade "a" fluid milk is only worth about one dollar per gallon, Kerry and Barb are able to charge four dollars per gallon for their product.

Kerry: I don't think there ever was a defining moment as far as when we decided to do it...We in fact, we always put one foot in and one foot out because we were afraid something might come out of the bushes that would make it impossible and infeasible for us to do it.

To get started, the Buchmayer's searched for bottling equipment. The cheapest and most rugged they could find was 50-years old. After all was said and done Barb and Kerry invested almost 200-thousand dollars. Some of that investment paid for the new combination milking parlor and processing facility.

Finally, in April of 1999, the Buchmayer's began delivering milk under the green hills harvest label.

The milk is homogenized and pasteurized. All the bottling is completed in their state inspected bottling facility. The Green Hills Harvest line includes 2%, skim, whole, and chocolate milk. There are plans to add butter and a "cream line" product to their marketing mix.

The Buchmayer's 15-year old son Austin helps with the operation and is paid for his time. But he hasn't told Barb and Kerry if he wants to take over the operation when they retire.

Barb: I think he's just waiting to see if you

know, if it's going to fly. I think if he could make some

money, you know, I think he would be thrilled to take it

over ....and I think he's just kind of riding along and

helping out to see how it all works.

Their daughter Blair, who just entered college, has already decided to pursue a non-agricultural career.

The Buchmayer's have no off farm jobs. Their entire income is based on the sales of green hills harvest products.

Barb handles most of the book keeping and marketing, Kerry fixes what ever breaks and both take turns making deliveries.

Barb: I mean we have a million things to do on the farm

that we haven't done or should do but we've just let

them go because we don't have the time or the money.

But right now the most important thing we can do is sell

the milk.

With Columbia located over 2 hours away, Barb's delivery day begins before 6:00 am and sometimes continues into mid-afternoon

The obvious point of sale would be organic food stores and the Buchmayer's deliver to several, including clover's natural market in Columbia, Missouri.

Patty: it's all about "what is certified organic, why is it

better?" And once people understand that, and believe

it, and it's really not hard to talk to Barb or Kerry, their

around and you see them and it's right from farm to

market, so to speak, and that's got to make an

impression on most people.

But the Buchmayer's have also managed to break into mainstream grocery stores that have expanded their dairy lines to include organic products. Today, barb is delivering to a Schnuks market, which has more than 90 stores in Illinois, Indiana, and Missouri.

Barb: I think a lot of them allowed us in because they wanted the product but they were skeptical because a lot of farmers don't.. aren't able to deliver every week and be consistent and they're concerned that and once people start buying your milk they want it. If they buy it, they want it every week and you can't miss a week.

Even with all the successes, the Buchmayer's have only reached the break-even level. Since last summer, they have completed plans to increase their output and expanded into the St. Louis market. To handle the increased production and the extra delivery duties they have also hired two part time employees.

Kerry: I guess it isn't all gloom and doom and maybe, if you know, we're smart and work hard, maybe, you can make a living and a good living on the farm.

Barb: we still have hope. I guess that's why we keep moving forward but I wouldn't say it was a tremendous success at this point. We're still looking for more market. Still looking to sell more milk. Uh, and still learning.

For "Market to Market", I'm David Miller.


Tags: agriculture dairy marketing markets milk news