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Colorado dairy industry sees continued growth in demand

Editor’s note: As part of our series, “From Cow to Curd: A Look Across the Nation,” Cheese Market News takes a look at the cheese and dairy industry across the United States. Each month we examine a different state or region, looking at key facts and evaluating areas of growth, challenges and recent innovations. This month we are pleased to introduce our latest state — Colorado.

By Rena Archwamety

MMADISON, Wis. — Colorado, home to 178,000 milk cows and 37 dairy processing plants, has seen significant growth in dairy over the last decade. A number of new plants have started production in recent years, and milk cows and production are on an upward climb. According to the most recent milk production report from USDA’s National Agricultural Statistics Service, Colorado had the highest year-over-year milk production growth in November at 375 million pounds, up 7.1 percent from 2017.

Dairy in Colorado employs nearly 15,000 people and generates more than $695 million in direct wages, according to recent data compiled by the International Dairy Foods Association (IDFA). IDFA estimates dairy’s overall direct economic influence in Colorado is approximately $3.3 billion statewide.

Dairy Farmers of America (DFA), which represents a high percentage of the dairy farm in Colorado, says its members have nearly doubled the state’s milk supply to meet local customer demand over the last decade.

“Through our network of valued customers within Colorado, including DFA’s own global foods manufacturing plant located in Fort Morgan, Colorado, we’ve been able to provide our members with a secure and diversified local market for their milk. This market has allowed current and new DFA members to grow at a pace that has carefully matched growing demand,” says Dennis Rodenbaugh, senior vice president and chief operating officer, DFA Western Area.

Rodenbaugh notes as examples partnerships with Leprino Foods as it built and expanded its Greeley, Colorado, Mozzarella and ingredient plant, and with Kroger’s new fluid milk bottling plant near Denver. The Kroger Mountain View Foods plant opened in May 2014, while Leprino completed the third and final phase of its Greeley plant in November 2017.

“DFA worked closely with our national strategic partner, Leprino Foods Co., as they were evaluating the location for their next state-of-the-art dairy manufacturing plant,” Rodenbaugh says. “Since that agreement to build in Greeley, Colorado, we’ve worked closely with Leprino Foods and our members to very closely align the timing of new milk supplies with the new demand.”

Rodenbaugh adds that at this point, Colorado’s milk production growth rate is on pace to meet the known milk demand in the state for the next five years.

• Major headquarters

A number of major national dairy companies are headquartered in Colorado, as well as are many successful local and regional cheese crafters. Global Mozzarella supplier Leprino Foods is based in Denver, while Aurora Organic Dairy, a major supplier for private label organic milk, is based in Boulder, Colorado. Noosa Yoghurt, recently acquired by Sovos Brands, was founded in Colorado in 2009 and remains manufactured in Bellvue, Colorado.

Colorado Ranchers Inc., a national supplier of Hispanic-style cheeses under the Queso Campesino brand, is based in Brush, Colorado, where it also opened a new production plant in 2017. More specialty cheese companies in the state include Haystack Mountain Goat Dairy in Longmont and MouCo Cheese Co. Inc. in Fort Collins, Colorado. Additionally, the American Cheese Society is headquartered in Denver.

Leprino Foods, one of the largest producers of Mozzarella in the world as well as a leading supplier of lactose and whey, started in Denver in 1950 as a small, family-owned market selling grocery items and handmade Italian cheeses.

Today, the company remains family-owned and operates nine U.S.-based manufacturing facilities, including two in Colorado. It employs more than 4,000 people worldwide and has sales in more than 40 countries. More than 1,300 of Leprino’s employees are in Colorado. Its headquarters, which also include a cheese and nutrition pilot plant, a research and development kitchen, and genomics and microbiology labs, are located on the same corner where the Leprino Family’s original grocery store once stood.

“Leprino Foods began as a Colorado company based on dairy. Because we rely on local dairy farmers to deliver a steady supply of milk, having close proximity of fresh milk is an imperative in siting our plants. However, it wasn’t until 1994 that we opened our first large-scale manufacturing facility in the state — in Fort Morgan in northeastern Colorado,” says Mike Reidy, senior vice president, corporate affairs, Leprino Foods.

“We gained full appreciation of the value and growth potential of dairy in our home state through this plant,” Reidy adds. “This region, where the Fort Morgan plant is located, is one of the top agricultural areas in the country and has a strong history of dairy farming. Neighboring Weld County, where our Greeley plant is located, is also a top dairy producing county in the U.S.”

Colorado’s dedicated dairy farmers, strong state and local government support and healthy milk shed make it an excellent location to do business, Reidy says.

“It’s also a great place to live for both dairy farmers and their cows,” he adds. “Colorado offers a high quality of life by boasting a great climate, ready access to several vibrant metro areas, a strong labor force, good educational facilities, and water sources from high mountain peak snow run-off.”

• Organic growth

Aurora Organic Dairy’s Colorado roots trace back three decades to when its founder, Marc Peperzak, started dairy farming in the state in the mid-1980s. Peperzak co-founded Horizon Organic Dairy (now owned by DanoneWave) with Mark Retzloff in the early 1990s. In 2003 and 2004, Aurora Organic Dairy built its vertically-integrated supply chain by adding its on-farm Platteville, Colorado, milk plant to process the organic milk from its farms. The company shipped its first store-brand organic milk to its first retail customer in late 2004.

“In 2003, private branded organic milk was less than 5 percent of the organic dairy category. Since then, retail store brands account for approximately 50 percent market share,” says Sonja Tuitele, spokesperson, Aurora Organic Dairy.

Aurora Organic Dairy owns and operates five organic dairy farms in Weld County, Colorado, including 6,700 acres of certified organic land for pasture, crops and facilities. Its Platteville farm has approximately 1,160 milking cows, and its High Plains Dairies in Gill, Colorado, are made up of four distinct properties and milking parlors with a combined total of approximately 10,585 milking cows. In addition to its Colorado operations, Aurora Organic also has two sites in Texas.

Tuitele says Colorado is a good place for both dairy farming and for doing business, and the company frequently partners with Colorado State University’s Colleges of Agriculture and Animal Sciences to conduct research on its farms.

“We have approximately 500 employees in Colorado. As one of the highest growth states, Colorado is an attractive place to locate a business,” she says. “There is significant agriculture, food processing and natural and organic expertise in Colorado. That allows for a talented pool of knowledgeable people when recruiting new employees. However, there is significant competition for these workers in the state, so we work hard to attract and retain our employees.”

She adds that Colorado is a state that welcomes agriculture, and the high altitude benefits organic dairy farmers because there are fewer pests.

“Colorado is a good place for dairy farming because we have 330 days of sunshine a year, a temperate climate and ample land for grazing,” Tuitele says.

• Local cheese

Another longtime Colorado business, Haystack Mountain Goat Dairy, started in the late 1980s with the homemade Chevre founder Jim Schott made from milking a handful of goats on his 6-acre farmstead. Haystack Mountain now has grown to a $2 million company and added a second creamery in Longmont, Colorado, a couple of years ago. The creamery has won more than 70 awards, including national and international medals, in the last 20 years.

“Jackie Chang, our cheesemaker, has proven time and time again with the awards she has received for our cheeses, that she is in the upper echelon of cheesemakers in the country,” says Chuck Hellmer, president and general manager, Haystack Mountain Goat Dairy.

At one time Haystack Mountain had up to 120 goats on its property, but it now relies on contract milk sources for both goat’s and cow’s milk. For more than 10 years, the company has partnered with Colorado Correctional Industries (CCI) to supply a million-and-a-half pounds of goat milk a year from a 2,000-goat farm CCI runs in Cañon City, Colorado, which is used to help train inmates in animal husbandry and general job skills. Haystack Mountain also sources conventional cow’s milk from nearby Longmont Dairy and organic cow’s milk from Aurora Organic Dairy.

“Goats and Colorado go together well,” Hellmer says. “Goats love dry climates, so you can get good, healthy, strong goats in Colorado.”

Some of Haystack Mountain’s more popular cheeses now include Queso de Mano, a Spanish-style raw goat’s milk cheese similar to Manchego; Buttercup, a mild cheese and the company’s first venture with cow’s milk; and the double-cream, washed-rind Funkmeister made with organic cow’s milk. Gold Hill, an aged goat’s milk cheese introduced two years ago, was named “Best American Cheese” at the 2017 World Cheese Awards.

Hellmer estimates that about 80 percent of Haystack Mountain’s cheese is sold within the Rocky Mountain region, though it is distributed as far as the East and West Coasts.

He notes that the cheeses get lots of support from Colorado’s locally-owned restaurants and dedicated foodies, who have long been buying Haystack Mountain’s cheeses.

“I would say Denver, Boulder, and even up north in Fort Collins, really have pretty strong restaurants, similar to Portland on the local scene,” Hellmer says.

“We have support form the region, and a small group of foodies that love our cheeses,” he adds. “They understand why we’re here, and the benefits of having a company that makes small-batch, handmade, traditional cheeses.”

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