Case Histories of Grass-Fed Market Development in the Upper Midwest

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1 Case Histories of Grass-Fed Market Development in the Upper Midwest Laura Paine Grazing & Organic Agriculture Specialist Wisconsin Department of Agriculture, Trade & Consumer Protection National Small Farm Conference, September 15-17, 2009

2 Growing grass-based farming Supporting graziers efforts to develop markets for grass-fed products.

3 Grass-Dairy Projects Grass-fed dairy product research Grass-based Dairy Marketing Case Histories Available soon at ww.cias.wisc.edu Farmstead Cedar Summit Creamery Otter Creek Farm Saxon Homestead Uplands Cheese Cooperatives Edelweiss Graziers Paradise Prairie Graziers PastureLand Coop Still Meadows WI Dairy Graziers Coop Existing Companies Alto Dairy Coop Grass Point Farms

4 Management intensive dairy grazing 30 days 30 paddocks Why Grass-fed? Economics Environment Quality of Life Healthier meat & milk?

5 Healthy fats in grass-fed products Multiple studies have documented: Higher Conjugated Linoleic Acid (a nutritionally important fatty acid). Lower Omega 6/Omega 3 ratios Higher Vitamin A Higher Vitamin E (Clancy 2006) mg/g of fat CLA in milk from WI Farms Grass-fed Confinement July August September October Data from Pearson et.al. 2000

6 Marketing claims used with grass-fed products Environmentally friendly Humane animal treatment Nutritionally healthy (CLA, Omega 3s) Supports family farms Food safety issues (E.Coli/factory farms) Local, know the farmer Natural claims, including rbgh free, antibiotic free.

7 Do features associated with grass-fed translate into perceived consumer benefits? Feature Benefit Very Important Survey responses Somewhat Important Environmentally friendly Clean water, wildlife 64.6% 28.2% No antibiotics or hormones Humanely raised Family farm Raised in my state (MI) Knowing the farmer Increased CLA, Omega 3s, Vitamins A & E Healthier for me 63.2% 24.1% The animal didn t suffer to produce my food Supporting farm families with my purchase Supporting local economy, smaller carbon footprint, etc. Trust in how the product was made Healthier for me 62.7% 28.8% 29.2% 33.2% 23.1% 29.2% 16.8% 17.3% Question not asked Data from Connor, MSU, 2006

8 Grass-fed is different 2005 comparison of grass-fed and conventional cheddar cheese at UW TMR G+G GBC Conventional stored feed diet Grass-fed with grain Grass-fed, no supplement

9 SARE Research Grant $148,000 over three years. Investigating the chemical and physical differences in grass-fed milk Participants Activities Researchers Farmers Processors Chefs Research Market assessment Outreach to farmers, processors, & buyers.

10 Comparisons Grass-fed vs. conventional stored feeds. Seasonal variation Spring flush Summer Fall SARE Research Grant Product testing Whole milk Cream Butter Yogurt Cheese (next year)

11 Tasting Event Participant comments: Grass-fed is creamy melts in your mouth. Conventional cleaner flavor, more familiar, what I m used to. Grass-fed butter has a more complex flavor. Grass-fed brings out the flavors of the seasonings. Flavor difference is remarkable.

12 Terroir Plants Animals Unique flavors Soil

13 Narrative Marketing The consumer is saying, I want to know the place it comes from. I want to be able to identify with it. (Fred Kirschenmann) Consumers no longer respond to companies that speak at them they respond to companies that speak with them. (The Hartman Group) The food business is no longer about fast, convenient, and cheap. It s about memory, romance and trust (Rick Schneiders, Sysco CEO)

14 Uplands Cheese Company Dairy farm partnership (two families) in SW WI. Started in Use only their own milk. Researched Alpine cheese types to develop their own recipe. Make one type of cheese: Pleasant Ridge Reserve. Won Grand Champion at American Cheese Society their 1 st year. Memory.Romance.Trust

15 Cedar Summit Dairy New Prague, MN Memory.Romance.Trust Started in Farmstead creamery. Multi-generational family farm. Signature product: glass bottled milk and cream. Farmers market sales important tool.

16 Scaling up to Farmer Cooperatives Five farmers in Eastern WI. Formed in Contracted to make cheddar cheese. Won award for cheese spread. Disbanded in Memory.Romance.Trust

17 PastureLands Cooperative Four farmers in SE Minnesota. Formed in Contract with various processors to make several kinds of cheese and butter. Butter has won awards in American Cheese Society contest. Currently developing new artisan cheeses.

18 Large Existing Dairy Processors Grass Point Farms Alto Dairy

19 Lessons learned. What s creating challenges? Milk variability. Milk handling and pooling. Commonplace foods, like fluid milk and cheddar cheese. Starting out with a national marketing campaign. Focusing marketing on health benefits. Investment in facilities. Timing.

20 Lessons learned. what s working so far? Do your own marketing. Have a unique signature product, a compelling story. Do your own processing, or find like-minded processing partners. Minimize initial investment. Start local and small. Timing.

21 Saxon Homestead Creamery Memory a good flavor, a good experience Romance a good story Trust--consistency

22 Can grass-based dairy be an economic development strategy for rural communities? Pasture based dairying A 250 acre pasture based dairy can generate an annual income of $225, to 100 cows can provide a comfortable living for a farm family. A farm that is compatible with urban development. A dairy farm generates $15,000 to $17,000 in economic activity per cow in the local community. Dairy processing plants provide jobs and generate revenue for rural communities.

23 Participants UW Extension & UW CALS WI Dept. Ag (DATCP). WI Dept. Commerce. Activities Education. Technical assistance. Tax credits. Low interest loans. Non-profit group supported by DATCP. Consultant teams. Business planning Equipment. Recipes. Marketing Label development. Assisting farmers and existing processors. Resources for Dairy Artisans

24 Additional Tools University Extension Traditional small business development assistance Ag and Community Development staff working together (Ag Innovation Counselors) Local Economic Development Resources Tax incremental financing Revolving loan funds Ag Development Zones Private investment possibilities Angel Investment networks Badger Ag Vest Slow Money

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