Adding Value to Milk

Adding Value to MilkLooking for ways to expand your small-farm dairy business? Milk offers many opportunities for diversifying your product offerings!

Here are some common ways to add value to farm-fresh milk.

Cream

Cream is not one of the more popular value-added dairy products around, but it does have a loyal following among health-conscious customers. Fresh, raw cream is often touted as nature’s ultimate health food due to its vitamins, minerals, enzymes, and beneficial bacteria. Good cream can also provide quite the gourmet cooking experience.

Butter

Because butter requires a great deal of milk fat to make, selling butter is typically a better fit for dairy farmers with cows rather than goats or sheep.

Another pitfall with butter is that it is often harder to sell to the public. Many customers (even those who aren’t necessarily health-conscious) won’t think twice about sampling homemade cheese or ice cream. But the market for farm-fresh butter is much smaller.

Buttermilk

Old-fashioned buttermilk is the milk left over from the butter churn, in contrast to grocery-store buttermilk made from skim milk, cultures, and thickening agents. Buttermilk is one of the less common dairy products sold on small farms, but it may be a way to salvage an otherwise wasted byproduct.

Or, to take the value-adding a step further, make buttermilk soap! Handmade soap can be a truly artisan product that commands high prices. It also has a major advantage over many dairy products in that it can be sold online and shipped across the country, enabling the soapmaker to find markets anywhere at all. The usual rules apply when selling soap—check the laws (soap is regulated by the FDA) and make sure you produce a quality product every time. If your customers are paying top-dollar for handcrafted soap, they expect more than a run-of-the-mill cleansing agent.

Cheese

Whether you keep cows, goats, or sheep, cheese offers a magnificent opportunity to the artisan entrepreneur. At the same time, it is a very popular product to eat across America! And another bonus? Cheese made from raw milk is typically regulated much less stringently than raw milk itself (but please check your state regulations before starting on your cheese venture).

Another advantage of selling cheese is that it allows for considerable variety, as there are many different types of cheese that can be made. Cheese made from raw milk must be aged prior to sale in some states, which means that the cheeses many small farms will be able to offer fall into the hard cheese category. Fortunately, hard cheeses do include some very popular varieties, such as cheddar and Gouda. Pasteurization will enable you to add soft cheeses like mozzarella and ricotta to your lineup. Another option for adding still more variety is flavoring your cheese with herbs and spices.

A few words of advice—trying making cheese for home use before turning this project into a business. Cheesemaking is very time-consuming, the equipment is expensive, and quality is the key to maintaining customer interest, so it’s a good idea to test your interest level and build your skills before committing. The good news is that instructional materials abound these days, making the learning curve much less steep.

Also keep in mind that specialty cheese sales usually peak around Christmas—near the lowest ebb of seasonal dairying.

Whey

Whey is a byproduct of cheesemaking. Hard cheeses are pressed to remove the fluids, which can in turn be sold as whey.

So what do you do with whey? Bottling flavored whey drinks is one option. Also, if you happen to know any other small farmers, you may be in luck. Whey can be marketed to pig farmers as feed, and it can also be sold as a very effective fertilizer for organic pastures and fields.

Ice Cream

Ice cream is an extremely popular value-added product, partly because it is readily accepted by the public whether sold by the gallon or by the cone. It’s also portable—some small-scale creameries set up shop in trailers at fairs and other special events, allowing them to capitalize on existing crowds in a festive mood.

The demand for gourmet ice cream is particularly high among older, wealthier customers. Hand churning and indulgent flavors can command an impressive premium—just be aware that choosing this marketing route will make your product a luxury and will consequently reduce your customer base.

Yogurt

Yogurt can be a favorite product among health-conscious consumers, who tend to view it as a positive snack choice.

One potential pitfall to be aware of is the fact that not all areas have a large enough interest to support a yogurt business. Even in areas with access to interested buyers, it would be quite easy to oversupply the market, since a pound of milk makes a pound of yogurt! Yogurt makers will definitely want to have another outlet for milk and dairy products besides yogurt.

Another factor to consider is that tastes vary. Most Americans prefer heavily sweetened yogurt made from low-fat milk. The thicker, less sweet product is more likely to be enjoyed by a few select groups.

Some Final Thoughts

Adding value to milk invariably requires expertise and special equipment. It also requires commitment, and preferably an artisan bent. Before undertaking any value-added dairy enterprise, assess your financial situation, your workload, and your level of enthusiasm carefully and honestly. Many successful dairy entrepreneurs start out learning to make their chosen product on the kitchen stove and sharing with friends and family for free.

One way to reduce the startup costs is to purchase used processing equipment. If you do want to buy new equipment, keep in mind that some manufacturers now make dairy equipment sized for smaller farms—industrial machinery is not necessary these days.

Also note that, in niche dairying, quality is all-important. Off flavors must be avoided, which requires close attention to grazing management. Furthermore, dairy products must be moved fairly quickly to avoid expiration.

Are value-added dairy products right for your farm? If you have serious passion to see you through, maybe so.

Helpful Resource

Starting & Running Your Own Small Farm BusinessStarting & Running Your Own Small Farm Business
This handy book offers a step-by-step approach to business planning. It addresses many of the financial, legal, and marketing issues you will encounter when considering value-added dairy. Read our full review.