Spring Forward

Wisconsin's Better Times

Volume 132, No. 45 Friday,May 9, 2008

Cheese makers saw margins destroyed in 2007 by a federal milk price that reflected high whey values and a NASS cheese price series that dangerously lags market prices.
And while cheese prices into 2008 still graph like a rollercoaster ride, lower whey values have fashioned a couple of months with positive margins for the cheese industry.

Moving Forward
Despite USDA’s indifference toward modernizing its milk pricing and pooling system, Wisconsin continues to retool and grow its cheese industry buoyed by dairy producers investing in new construction and building cow numbers.

In Wisconsin, the number of farms with 200 or more cows grew by 50 farms in 2007 to a total of 1,000 farms, according to the Wisconsin Ag Statistics Service. These 1,000 farms house 36 percent of Wisconsin’s cows and account for 41 percent of the state’s milk production.

Wisconsin milk production rose 3 percent in 2007 and is up 2.4 percent in the first quarter of 2008.

New, green-field cheese factories in Wisconsin launched production this spring: BelGioioso’s new plant in Freedom produces fresh Mozzarella and Fontina cheeses, W&W Dairy began production of Hispanic cheeses in Monroe last week and Woolwich Dairy unveiled its new Lancaster facility this week producing goat’s milk cheeses.

In addition, Foremost Farms reopened its Waumandee cheese factory in March to produce Cheddar for aging, Sartori Foods broke ground in March for a $15 million converting plant in Plymouth and Sargento Foods is completing major additions at its Hilbert and Kiel facilities.

These commercial operations are joined by numerous farmstead and artisan cheese makers that have ini-
tiated cheese production in the past year, including: Saxon Homestead Creamery in Cleveland, WI,
Holland’s Family Farm Creamery near Thorp, Roelli Cheese near Shullsburg, Yellowstone Farmstead Cheese near Cadott, Harmony Specialty Dairy in Edgar and Hidden Springs Creamery near Westby.

More Specialty Cheese
Growth among artisans and expansion by Wisconsin’s established cheese manufacturers boosted 2007 production of specialty cheeses by 3 percent in Wisconsin.

The state released data May 2 detailing production of 399 million pounds of specialty cheeses at 83 plants in Wisconsin. Wisconsin netted three more plants producing specialty cheese compared to 2006.
Interestingly, Wisconsin data on specialty cheese production (and total cheese production) contains no data on goat and sheep milk cheeses. Wisconsin production of these cheeses is not trivial.

Wisconsin counted 33,000 dairy goats on 600 farm operations in 2007, 50 more farms than the year before.
Wisconsin has more dairy goats than any other state and the largest concentration of goat cheese production capacity.

In May, the new Woolwich Dairy will join major Wisconsin goat milk cheese makers at Montchevre Betin in Belmont and Mt. Sterling Cooperative. Ten additional cheese makers, from commercial factories to farmstead makers, produce goat milk cheeses in Wisconsin.

The National Ag Statistics Service does not release goat and sheep milk cheese production data. Wisconsin, too, blankets this data because a release of information may too closely indicate proprietary production totals at the largest facilities.

Positive Projections
Wisconsin’s rising milk production and new plant capacity continues a four-year growth trend for America’s Dairyland.

But the future for Wisconsin and the US dairy industry is unclear. The decline in milk production among key exporting nations in recent years and rising demand for dairy protein in Asian markets holds enormous potential for dairy farmers and dairy processors. But a weakening US economy coupled with soaring energy, packaging and ingredient costs will negatively impact sales and margins.

In 2007 Wisconsin surveyed its dairy producers and learned that while 27 percent anticipated retirement or departure from dairying in the next five years, 24 percent intended to increase their herd sizes by 2012.

Wisconsin dairy farmers said they plan on increasing investments for new facilities and upgrades over the next five years by spending $1.07 billion. Herds with 100 or more milk cows plan on spending 84 percent of these investment dollars.

In 2008, Wisconsin processors will apply for $300,000 in new grants from the state’s Value Added Dairy Initiative (VADI). Since 2004, 72 large and small dairy processors have been awarded $1.6 million in Grow Wisconsin Dairy Team grants through VADI. Processors will also gain state tax credits in 2008 on dollars invested in plant expansion or upgrades.

In spite of frustrating federal regulation, Wisconsin’s dairy producers, cheese makers and state government have partnered to rebuild America’s Dairyland. The Wisconsin dairy industry believes in its future and is building it one new barn, one new cheese and one new market at a time. •

John Umhoefer has served as executive director of the Wisconsin Cheese Makers Association since 1992. You can phone John at (608) 828-4550; Fax him at (608) 828-4551; or e-mail John Umhoefer at jumhoefer@wischeesemakersassn. org