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Archive for Monday, April 24, 2006

Milking it for all it’s worth

Dairies find success in a bottle

April 24, 2006

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— The Iwig family has been in the dairy cattle business for seven decades. But a year ago, that tradition was in danger.

"There's not any money in it," Tim Iwig said of traditional dairy industry practices, where farmers sell their product to big companies that process and sell the milk, in plastic and cardboard containers, to grocery stores.

"You don't have any control over your price, and your milk is getting blended with everybody else's milk, and you're not able to get a good price," Iwig said. "You get what you're told the market will pay, and that's not enough. And it fluctuates its way up and its way down. You can never plan."

In October, though, the Iwigs started doing things differently. They decided to keep their own milk and pasteurize and package it in glass bottles reminiscent of the mid-20th century and earlier. They started selling their products straight off the farm and directly to area grocery stores, cutting out the middleman.

Suddenly, the Iwigs are profitable again.

"We can sell that (glass-bottled milk) for a higher price," Iwig said, "because people know they'll get good-tasting milk."

The Iwigs have joined at least two other regional farmers in the glass-bottled milk business - not exactly a trend, but an increasingly visible way for small farms to stay in business and make money.

"It's been unbelievable," said Leroy Shatto, who owns the Shatto Milk Co. that sells to Kansas City-area stores. "It's working."

Better income

Will Newhouse and his family near Wellsville were the first in the chute, back in 2001, after getting fed up with low profits from traditional dairy farming.

"It got to be where you weren't making any money," Newhouse said. "You were just barely getting by.

"There wasn't anything more disgusting than working that hard, seven days a week, 365 days a year, and not making any more money than you would if you'd gone down to Dairy Queen."

He bought a giant pasteurizing vat and bottling equipment, and started selling directly to Lawrence-area stores, including the Community Mercantile Co-op and Hy-Vee.

"If you produce it, process it and market it yourself, you have more control over your destiny than if you take what the co-ops are taking," Newhouse said.

Others took notice. The Shattos, in Osborn, Mo., followed the Newhouses into business in June 2003.

"It was either try to figure out some way to make money with these cows, or they were going to go," Leroy Shatto said. "All my other friends in the dairy business got smart and quit."

Iwig was the most recent to join, getting help from an agent who helped him buy 1950s-era bottling equipment that had been abandoned in New York - reflecting the fact that it's been a long time since most people purchased their milk in glass bottles.

"Most of what we have in there is 1950s, 1960s vintage-type equipment," Tim Iwig said.

Despite the success, Kansas State University agricultural economist Allen Featherstone said the do-it-yourself dairies will be a niche market. But those who take advantage of the niche, he said, should do well.

"In some sense, you're capturing more of the consumer dollar by doing the processing on the farm," Featherstone said.

Distinctive taste

At the Merc, Newhouse glass-bottled milk is one of the grocery store's more popular items.

"They just love it," said Laurell Matthews, an assistant general manager for the store, 901 Iowa. "It's a very popular line for us."

There are several reasons for that. First there's the glass bottle - what Newhouse acknowledged was a "marketing tool" aimed at people who remember fondly a time when deliverymen dropped milk off at your front door. And each of the three farmers said the glass helps keep the milk tastier for longer.

There's also the flavor. Because Newhouse, Shatto and Iwig don't sell to a co-op that blends their milk with other producers' milk, each has a distinctive taste different from the mass-produced milk mostly found in grocery stores.

"They know when they get it it's going to be good, and it's going to keep in the refrigerator," Iwig said.

The result, Shatto said, is that "we got pride back in what we do. I was in the dairy business for 30 years and nobody ever told me how good our product was."

The three farms have, so far, stayed out of each other's way, selling their milk in different, though neighboring, regions.

"There's enough market," Newhouse said, "for everyone who wants to be in the business."

Comments

Vermooten 8 years, 7 months ago

Interesting article: more power to them.

Doesn't the Journal-World proofread its writing? Whoever wrote the photo captions thinks that the plural of calf is calf's. It's not. The word should be calves. The error appeared at least twice. C'mon, guys!

Janet Lowther 8 years, 7 months ago

Worse than that, Vermooten, They can't tell a possessive from a plural!

just_another_bozo_on_this_bus 8 years, 7 months ago

But look on the bright side, macon. It gives you a reason to pull out your highly effective all-caps technique to drive home just exactly how "HO HUM" it is.

just_another_bozo_on_this_bus 8 years, 7 months ago

Are you paying your fee to post here, macon, or are you a freeloader like the rest of us?

znsh18 8 years, 7 months ago

I can't drink those big name milks, taste more like water. I love their whole milk & I drink milk every morning. I hope with the opening of new wal-mart I can still get this milk from Hyvee each week. Thank you guys for the great service & quality product..

GardenMomma 8 years, 7 months ago

When Wal-Mart shut down its recycling center I found a better place to go. They take everything Wal-Mart does AND you don't have to separate your plastics AND they pay you for aluminium and steel to boot!

It's just too bad that there will be another Wal-Mart in town. I mean, do we really need one? Are the people who live on the northwest side of town really going to shop there or won't they prefer to buy better quality things? C'mon!

The LJW seems to have corrected the spelling errors.

just_another_bozo_on_this_bus 8 years, 7 months ago

Aren't you going to answer my question, Macon? Or are you just another "fragile young liberal?"

Bill Smith 8 years, 7 months ago

macon47 stop...please! It's the republican politicians that have the big fear about raising taxes for anything because they're afraid they will lose votes. I am sorry folks but our government can only run on the taxes dollars it collects. I am not sure how the conservative republicans expect to pay for all their initiatives without raising taxes. Oh yea, I forget, they take the money from the social services programs, education, and the arts. My bad!

I am one of those liberals that often times are criticized on here. However, I would be more than happy to pay a bit more in local taxes so the City of Lawrence can have its own recycling program and curb side pick-up. Then I wouldn't be forced to use the Wal-Mart recycle center. I would also be more than happy to pay a bit more in state/federal taxes to ensure that we have adequate funding for social service programs, education, and the arts. I am pissed off that my taxes dollars now go to fund a war, to subsidize big businesses, oil, and all the other pork barrel crap programs of this administration.

So macon47, in short, your conservative republican rhetoric pisses this liberal, democrat off!

gccs14r 8 years, 7 months ago

GardenMomma,

Care to enlighten the folks who'd rather not recycle at Wal-Mart what you found?

cutny 8 years, 7 months ago

Hey Macon, what's up? Back on your whining and complaining/freeloader kick again? Yawn....what a surprise...

topekan7 8 years, 7 months ago

Iwig milk is incredible! I refuse to drink any other brand of milk.

topflight 8 years, 7 months ago

I bought my first Iwig bottle the other week. Chocolate, and it was damn good. Keep up the good work.

law 8 years, 7 months ago

I'm going to start buying that stuff now. Sounds good.

b_asinbeer 8 years, 7 months ago

Their milk is actually very good. I'd give it 4 cows out of 4...

yoornotmee 6 years, 3 months ago

Without a doubt, the Iwig's is the best milk I have ever had the pleasure of experiencing. I can't settle for any less now.

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