Western Regional Report
Dominating Dairies
by Pamela Accetta Smith
Western processors pack a punch.
Dairy production in
the western United States has been in a phase of rapid expansion for quite
some time now. In fact, this region is responsible for producing an
abundance of some of the country’s finest dairy products.
Western dairies definitely make for a dynamic and
growing industry that reaches into foodservice and manufactured food
products, as well as retail dairy products.
There are many factors that contribute to the
success of these Western processors. For one thing, the increase in
milk production, especially in the nation’s top milk producing state
of California, is perhaps one of the biggest trends behind the burgeoning
dairy market in this region. To that end, may experts say dairy farming in
the West is different from other regions of the country in that its systems
are able to make a bit more money.
The healthy milk supply is a major reason many
Western manufacturers are investing in new facilities or making
improvements to existing ones. These companies have made tremendous capital
investments over the past few years, in new plants, distribution and
marketing. They have grown in sophistication and power, and by the looks of
things will continue to do so.
The western United States is home to many pioneers
indeed, especially when it comes to dairy foods and beverages. What follows
is an exploration of some of the Western region’s dominating dairies.
Royal Crest Dairy Inc. Denver, Colo.
Royal Crest Dairy is a
family-owned and operated home-delivery business that has provided milk to
consumers in Colorado’s Front Range for nearly 80 years. With a long
history of commitment to Colorado’s quality of life and some of the
finest healthful dairy products available, Royal Crest has grown from a
small operation in Denver to include sales and distribution centers in
Colorado Springs and Longmont.
The company’s new state-of-the-art
processing facility in Longmont opened in December 1999. The plant, an
estimated eight times the size of Royal Crest’s previous processing
facility, is reported to be one of the most functional and appealing
manufacturing sites in the industry.
Royal Crest home delivers more than just milk. The
company offers more than 25 additional products including eggs, cheese,
butter, bread, orange juice and bottled water. The product mix comprises
mainly private label items but also includes brands such as Coffee-Mate,
Silk and Starbucks. Seasonal items such as lemonade and eggnog are also
available.
Royal Crest All Natural Milk is rBGH-free and,
when tested with organic milk, meets or exceeds organic standards for
pesticides, antibiotics and growth hormones, says Julie Bailey, marketing
manager. Furthermore, the company’s bottles are reusable and
recyclable. To that end, says Bailey, Royal Crest has received numerous
environmental awards and was recognized in 1999 with a Colorado Ethics in
Business Award by the University of Denver.
Though not available in retail stores, Royal Crest
All Natural Milk — when tested in a recent independent consumer
survey — was preferred over other brands by more than 50 percent of
the respondents, says Bailey.
Chocolate milk dominates as the preferred flavor
among Colorado consumers, says Bailey, adding that Royal Crest processes 2%
chocolate milk for home delivery in half-gallon, one-trip bottles.
“The opaque white bottle is completely
recyclable,” she says. “And the chocolate milk is made with
real vanilla and approximately 16 pounds of real chocolate per 100 pounds
of milk, creating a genuine favorite with our customers.”
An additional line, Farmer’s All Natural
Milk, is distributed in select retail outlets in the Front Range. This
product is also packaged in an opaque white bottle to minimize the harmful
effects of light during transportation and storage. The milk is available
in gallons, half gallons, quarts and pints.
Royal Crest owns and operates 17 milk convenience stores under
the Farm Crest All Natural Milk label.
Promised Land Dairy San Antonio, Texas
Promised Land Dairy
(PLD) is famous in its marketing area for producing healthy, high-quality
milk products that taste great, says Gordon Kuenemann, executive vice
president.
“PLD milk comes exclusively from Jersey
cows, making it naturally 20 percent higher in calcium and 10 to 20 percent
higher in protein, depending on the time of year, than other milks on the
market,” he says. “In addition, PLD milk is available in a wide
range of flavors, anywhere from the extraordinary Mooberry Blueberry to the
time-honored classic Midnight Chocolate. And since we believe milk should
remain as Mother Nature intended, we never add artificial hormones,
ensuring the product is 100 percent all natural and hormone
free.”
Consumers in the Western region, says Kuenemann,
appear to be excited about, and place a great deal of importance on,
higher-quality, all-natural products. “As a result, they thoroughly
love our milk, and we are excited to be able to give it to them.”
Sales do indicate every region tends to adopt a
favorite flavor, says Kuenemann. “For example, Peaches ‘N Cream
sells particularly well in the Southeast, while Midnight Chocolate is
always a favorite in all regions, especially the West,” he says.
Due to customer demand, the company recently
reintroduced half-gallon sizes for three of its most popular milks: Whole
White, Reduced Fat 2% White and Fat-Free White. As part of an extensive
research effort to bring the half-gallon bottle back to its customers,
Promised Land Dairy took a hands-on approach by designing its own exclusive
mold of a PET plastic bottle. The company says the bottle was specifically
designed for PLD milk and will provide its customers the same outstanding
taste, freshness and quality they’ve come to expect.
Designed to fit easily into a refrigerator door,
the new half-gallon PET bottle also features a twist-off cap that will keep
the contents fresher, increase shelf life and, like glass, not alter the
milk’s flavor. “We are excited about this endeavor because we
custom-made the mold for the container and we designed it to be as
effective and easy-to-use as possible,” says Kuenemann. “A new
twist-off cap was also introduced on the new half gallons, which allows the
milk to stay fresher longer. It is so well received that we are making all
of our products with a twist-off cap.”
The increasingly high price of milk for consumers
has dramatically impacted the dairy industry as a whole, says Kuenemann.
“For Promised Land Dairy, higher costs of ingredients and
transportation have had an effect on business, but the company has been
able to work through these issues in order to provide our loyal customers
the products they love.”
While adopting a reduced-carbohydrate lifestyle
has been a popular trend, PLD hasn’t seen its milk sales dramatically
effected by this craze. “We think this is most likely because people
still appreciate a high-quality product like our milk,” says
Kuenemann. “However, we are looking into some opportunities that will
allow us to offer carb-conscious consumers a great new product through PLD
milk.”
Although currently not operating in the
school-vending channel, the company does recognize the importance of dairy
in children’s diets and realizes the significance of this
increasingly popular venue. “Since PLD milk is higher in calcium and
protein, it can considerably help kids get the nutrition their bodies
need,” says Kuenemann. “We are always looking into future
opportunities and this is certainly an area we are considering.”
United Dairymen of Arizona Tempe, Ariz.
Incorporated in 1960,
United Dairymen of Arizona (UDA) is a flourishing agricultural
milk-marketing cooperative. Its founding, through a merger of two dairy
associations, ensured a stable market for dairy producers and an adequate
supply of fresh milk and dairy products of the highest possible quality for
consumers.
UDA’s membership consists of 88 producers,
averaging 1,200 head per dairy, representing about 90 percent of the milk
in the state. Although smaller than some in terms of membership, UDA ranks
13th among
the country’s 200 dairy cooperatives and is in the top 100 out of
48,000 cooperatives nationwide.
UDA’s modern manufacturing facility in Tempe
operates 24 hours a day, seven days a week, to produce high-, medium- and
low-heat nonfat dry milk (including vitamin-fortified products), cream,
skim milk, condensed skim milk and lactose powder.
The latest addition to the product line, milk protein
concentrate (MPC), makes UDA one of the only two manufacturers of this
product in the United States. “We also supply the raw milk for a
cheese manufacturer on site,” says Frances Lechner, member relations
manager.
UDA’s plant, says Lechner, can process 10
million pound of milk per day and regularly acts as a balancing plant for
other processors in the region. “It also is the largest supervised
kosher milk facility in the country, capable of producing over 1,000 metric
tons of kosher powder within two weeks,” she says.
Employing approximately 185 full-time personnel,
UDA is among the few remaining full-service dairy cooperatives in the
country. “We offer our members installation, emergency repair,
preventive maintenance, transportation services, chemical equipment and
pharmaceutical supplies,” says Lechner.
The West’s unique role, says Lechner, is to
maintain a heavily individualistic “frontier” state of mind
with influences from a variety of other cultural and ethnic groups. The
region, she says, boasts a blend of traditional country fare, with steak
and beef houses dominating the food scene.
But, Lechner says, ever-popular Mexican cuisine
and other ethnic selections are giving beef a run for its money. “The
universities attract a diverse student population, so food choices in
grocery stores and restaurants are more diverse, including Asian and Middle
Eastern influences,” she says.
The weather in the Phoenix area — or the
“Valley of the Sun,” as many call it — is ideal for
living, traveling, doing business, shipping product and producing milk,
says Lechner. “UDA’s members have successfully overcome summer
heat challenges with high-tech solutions so that production can be
predicted with a high rate of accuracy,” she says. “In
addition, the availability of empty trucks simplifies shipping to and from
the region.”
According to Lechner, UDA’s strong financial
position, agility in the marketplace and consistent high-quality products
make the cooperative ideal for joint ventures and creative business
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