The State of Texas Milk

Story and Photography By Kelly Yandell 

There is a certain pastoral simplicity conjured up by the idea of drinking a frosty glass of milk; perhaps nothing evokes such a wholesome and nostalgic image in our minds. But the dairy industry is incredibly large and complex, and contends with supply-and-demand variables that are hard to fathom. When considered as a monolithic industry, the state of milk in Texas is good. Driven by incredible growth in the High Plains region, Texas is beginning to dominate an increasing share of the national dairy game.


Eight of the top ten milk-producing counties in Texas are located in this region, and according to the U.S. Department of Agriculture, dairy products constitute the fourth-largest agricultural commodity produced in Texas in terms of value. Yet, while large dairies are producing more milk from bigger herds, smaller conventional dairies are closing, struggling or dramatically changing to deal with the challenges of commercial dairy farming.


Conventional dairy business in Texas is well documented. The milk market administrator for a region keeps detailed records on how much milk is produced, and what portions and grades are used for differing purposes, such as fluid milk, cheese, whey, butter and dry milk. Just over a century ago, a glass of milk was obtained from a family cow or the cow of a neighbor. But massive and laudable efficiencies have been incorporated into the business, ensuring that dairy farmers can get their milk to market, and people who are living many miles from the nearest dairy farm can still obtain milk. Of course, the perishable nature of fluid milk creates unique challenges. It is harvested daily and must be processed quickly. Farmers created co-ops to pool and streamline milk production. Co-ops negotiate with processors and wholesale buyers to sell the milk and its component parts, and farmers are all paid one price (per hundred pounds of milk).

Trucks travel to dairy farms and pick up one to two days’ worth of production. The milk is pooled in the tanker truck with milk from other farms and then delivered to a central processing facility. It is subject to quality standards, but it is all combined. The fluid milk and components are routinely shipped across state lines to larger facilities that package and brand the products for retail sale. Depending on the packager used by the retailer or distributor from whom you purchase milk, the liquid inside could have originated from almost any state in the United States.

Today, some of the most challenging aspects of dairy farming in Texas are the heat and recent drought. Heat distress can lower milk production in cows, and the use of fans, evaporative coolers and other cooling devices is costly. Additionally, the drought has made it very difficult to pasture feed cows on uncultivated land, and the high costs of the constant irrigation necessary to cultivate forage are taxing. Farmers have to look elsewhere for supplemental feed at increasing costs, and as any business owner knows, administrative, payroll, health care and insurance costs have continued to rise.

Dairy farming is also exceptionally labor-intensive. The workdays begin early, and there’s not a single day when the cows don’t require tending and milking. In light of this, some dairy families simply make a switch to beef cattle. According to former dairy farmer Ella Goebel in Cuero, “beef cattle take care of themselves.” Faced with the decision to “get bigger or get out,” she and her husband chose the latter in the mid-1990s. She estimates that 80 percent of the dairy farmers in her county made the same decision.

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Dips and spikes in prices paid to dairy farmers abound, but in 2009, the price paid to farmers for milk fell far below the cost of production. The economic downturn caused people to eat out less, to consume less dairy generally and to economize. International demand patterns changed, as well. The supply of milk was high, the demand fell and prices plummeted. This sustained period of low prices was cataclysmic for small dairy farmers. Highly leveraged operations, in particular, were extremely sensitive to a period when the price obtained for their milk barely covered the costs of production. Dairy farmers are price-takers, meaning they are paid after delivery at a price set by the markets. They do not individually set their milk prices to reflect the costs associated with producing milk. It’s a squeeze. Farmers in catastrophic debt, of advanced age or sitting on land prized for its recreational value have very difficult decisions facing them in these situations.

Overall, though, the milk business in Texas is expanding in terms of production—a benefit to the dairies that are thriving and to the counties in which they operate. But Texas is trading one type of conventional dairy industry for another. The trends indicate that the larger dairies in the High Plains will continue to grow—barring an unforeseen catastrophe that could substantially reduce demand for milk and milk products—but the loss of smaller dairies is consequential. A 2006 Tarleton State University study of Erath County’s dairy industry estimated that the loss of a 1,000-head farm leads to a loss of 61 dairy and dairy-related jobs.

Independent and organic dairies are alternatives to the conventional milk route and all that it entails, though hard numbers are difficult to come by because these dairies aren’t monitored to the extent that conventional milk co-ops are. There is an entire, albeit smaller, version of the conventional milk market for organics, and the price paid for the milk is substantially higher—allowing organic farms to operate on smaller scales. Independent dairies forgo the traditional marketing routes and bring their own products to market in varied ways. Even some conventional dairies, after struggling through the inevitable pricing cycles, have determined that allowing the price of milk to be set entirely by the processors was not a viable business model and transitioned out of conventional milk to organic or independent or both. Over the last few years, those dairies seeking an alternate path from commercial production and distribution have spawned a groundswell of local quality milks, artisanal cheeses and yogurts and quality meats that are highly sought after.

Prior to 2002, Full Quiver Farms, in Kemp, milked 150 cows commercially. “We were going broke in the commercial dairy business. We had no choice,” says owner Mike Sams. “We just had to do something else.” They sold down the herd to 50 cows and switched to selling raw milk from their farm store. They also diversified their business to include the production of handmade cheeses now carried by both Central Market and Whole Foods Market, as well as by Wheatsville Food Co-op. In addition, they participate in farmers markets in Austin, where they sell their cheeses in addition to grassfed beef, whey-fed pork and eggs. “For a small producer,” says Sams, “this is the only way to go.”

The Sams family includes nine children. Prior to their transformation into an independent dairy, their margins were so slim that none of the family’s grown children were able to work on the farm. However, the business is now stable and profitable, and several of them are currently part of the family business. “[Before], there was no way to bring the kids into the business,” Sams notes. “Now it is profitable enough that we can. And they are more than happy to come back to the farm.”

Alysha and Ben Godfrey run Sand Creek Farm and Dairy in Cameron. They’ve never sold milk through the conventional system, and they were the first Texas dairy licensed to sell raw milk directly to the public. Both Alysha and Ben have degrees from Texas A&M University, in scientific nutrition and agricultural development, respectively, and they have taken a very purposeful approach to raising healthy cows and selling wholesome food. They currently have 32 milking cows that are grassfed on 170 acres. According to Alysha, farmers have to educate consumers on “what good food really is,” and consumers need to know what it costs to produce good food. To this end, one of the unintended benefits of raw-milk regulations that require consumers to buy directly at the farm, is that customers actually see how the cows are raised and witness the care that goes into their upkeep.

The Godfreys are vigilant about testing their animals frequently to make sure that they are selling—and feeding their own five children—the safest and highest-quality milk possible. Their raw milk is currently sold at their farm store, and they sell their cheeses to Antonelli’s Cheese Shop in Austin and to Houston Dairymaids. They also sell other value-added products, such as beef and lamb from a neighboring farm and dried blueberries and cranberries sourced from Oregon. “We only sell food we have diligently searched for and are willing to serve to our family,” explains Alysha.

One commonality with all of the independent dairy families interviewed is that they feel that they are offering a truly superior product by working with fewer animals. They are feeding them grass and natural forage, relying very little or not at all on commercial grain. Several have chosen to forego organic certification, not only because of the cost and cumbersomeness of the process, but because they have personal relationships with their customers who visit the farms and can see for themselves the way the cows are raised. These farmers tend to run operations that are technically organic in nature, and in many cases exceed the minimum standards for organic certification. But the rapport they have with their customers obviates the need for a marketing badge, and lacking the certification allows them flexibility in making care decisions for their animals that are ethical, but might not comport with the one-size-fits-all nature of certification. Interestingly, all of these farmers emphasize that there is plenty of room in the independent Texas milk and cheese market for dairies to switch to this model. “We were in trouble, and this has been the way it opened up for us,” adds Mike Sams. “There is room for other people to do the same thing. I just like to see people succeed.”

Kent and Ramy Jisha of Texas Daily Harvest, in Yantis, sold 1,000 conventional milk cows in order to pursue the independent route. They were fortunate enough to make the transition in 2008, before the price of conventional milk went down dramatically. They started over with organically raised cows and now have a herd of around 150. They produce low-temperature pasteurized milk, which they sell through outlets like Whole Foods Market, and also produce drinkable yogurt, Greek-style yogurt and cheese in addition to beef and pork. Kent notes that even with the transition, the drought has been a challenge for dairies this past year. “Normally we don’t have to feed hay to our cows until November,” he says. “This [past] year, we had to start in June. Usually, we make our own hay. This [past] year we had none and had to go to northern Nebraska for organic hay. The trucking cost more than the hay.”

The Chaloupka family of Four E Dairy, in Moulton, has found another way of supplementing their conventional-milk income. In addition to having 48 of their 400-head herd devoted to raw-milk production, they’ve started an “agri-tainment” venture that provides farm tours for school field trips, as well as seasonal farm activities such as corn mazes, duck races and hayrides. Owner Elyse Chaloupka notes that during the pricing crisis of 2009, dairies didn’t know where to turn, and that the “agri-tainment” portion of their business let them focus on other things. “It gave us hope,” she says. “When I married into [the dairy], there were at least 20 dairies in the county, and now we are the only one left.”

Whether a dairy is conventional, independent, raw or organic—there’s something for everyone, and at every price level, in the Texas milk market. And with smart diversification, value-added products and alternative thinking, even the smallest of dairies seems to have a fighting chance. While conventional milk meets the needs of many in the market, alternatives to mass-produced milk and associated products are holding their own, and the farmers who produce them are anxious to find a market for their goods so that they can operate outside of the conventional-milk loop.

 

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Texas family-owned cow milk dairies

Sampling of family dairy farms who sell their products in the Austin-area markets. For a comprehensive list of Texas family dairy farms visit realmilk.com.

Dyer Dairy
7801 E. Hwy. 29
Georgetown
512-638-0415
dyermercantile.com

Eagle Mountain Farmhouse Cheese Co.
2665 W. Hwy 377, Suite 101, Granbury
817-579-0090

Four E Dairy
The Chaloupka family
784 CR 251, Moulton
361-596-7292
chaloupkafarm.com

Full Quiver Farms
Debbie and Mike Sams
6238 FM 3396, Kemp
903-498-3884
fullquiverfarmtx.com

Lavon Farms
Todd and Deanna Moore
3721 N. Jupiter Rd., Plano
972-423-8080
lavonfarms.com

Mill-King Market and Creamery
The Miller family
1410 Coyote Ln., McGregor
254-486-8999
mill-kingmarket.com

Miller Farms Raw Milk
12730 FM 471 S., LaCoste
210-508-1733
millerfarmsrawmilk.com

Sand Creek Farm and Dairy
Ben and Alysha Godfrey
1552 CR 267, Cameron
254-697-2927
sandcreekfarm.net

Sandy Creek Farm
Mike and Debbie Moyers
1674 Cuba Road, ?Bridgeport
?940-393-1176
cowquest.com

Stryk Jersey Farm
Bob and Darlene Stryk
629 Krenek-Stryk Rd., Schulenberg
979-561-8468
texascheese.com

Texas Daily Harvest
Ramy and Kent Jisha
275 CR 1455, Yantis
903-335-1761
texasdailyharvest.com

Veldhuizen Cheese
Connie and Stuart Veldhuizen
425 Private Rd. 1169, Dublin
254-968-3098
veldhuizencheese.com