A New Business Model Proves Lucrative for Grass-Based Dairies
In New York, consumer interest is driving demand for local food products, even while the number of farms is shrinking. When Becca Jablonski began a project to support dairy farmers in New York, the price of milk was $11.83 per hundredweight, well below the cost of production.
But Jablonsky was familiar with the research showing that consumer demand for local foods is strong - research like a recent study from the Grocery Manufacturers Association, which found that 85 percent of consumers chose their grocery store in part based on whether it stocked food from local farms.
She knew that it takes agility, technical support, and money to respond to changes in the marketplace. So Jablonsky sought funding from USDAs Sustainable Agriculture Research and Education (SARE) program to figure out a workable way to tap into this demand and help New York dairy producers. The result was the establishment of Kriemhild Dairy Farms, L.L.C (KDF), a company with four member farms and two more Amish farms as affiliate contractors. They came together with the shared goal of developing a line of branded grass-based dairy products; agreements are now in place with Queensboro Farm Products, Inc. to process KDFs first consumer offering, butter. Three local food distributors and a grocery store chain have agreed to carry KDFs butter, and the company is now positioned to take advantage of this emerging market.
Another result has been remarkable project momentum and leveraged money-KDF was recently awarded a $17,000 USDA Value-Added grant and also got $5,000 through a private donation. The new company now has all the funding needed to test, package, and launch the grass-based butter.
And, as Jablonski reports, there have been less tangible but equally important impacts: "The community seems to have rallied around it," she says, and the farmers also found a way to bridge their differences and move from competition to cohesion.
The farms involved were unusually diverse, "ranging in size from milking 20 cows to 800," she says. "Two of the participating farms are Amish, and the non-Amish farmers worked with them to figure out a way for them to participate without having to compromise their religious beliefs. Two of the participating farmers are fifth- and sixth-generation farmers, and four of the farmers have lived in the area less than ten years."
She describes the meetings and discussions as "animated," but she also says the farmers "always took the time to listen to each other and really understand the other farmers point of view-even if they did not agree with it."
SARE looks for opportunities to make modest, strategic investments that will invite long-term, measurable results. This project clearly did that, and the continued funding will likely keep the fledgling corporation strong and the conversation going. And, as Jablonski puts it, "Without funding from SARE, KDF would not exist."