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As you come over the hill into
La Farge, Wisc., population 766, you might not think you had
arrived in the hometown of a company that posted more than
$200 million in sales in 2004. There's a wide main street,
an IGA, a lumberyard—a typical small town in the Upper
Midwest, you think. Then you correct yourself: a prosperous
small town in the Upper Midwest. Not so typical.
Since 1988, La Farge has been home to the Cooperative Regions
of Organic Producer Pools—better known to locals as
CROPP; better known to the general public by its retail label,
Organic Valley. Today the cooperative is one of the shining
stars of the organic movement—a farmer-owned and –directed
company whose growth has kept pace with the bigger, corporate-organic
food labels and whose founders have managed to balance that
growth with adherence to their originating principles.
The cooperative currently includes 689 farmers in 20 states,
and has diversified from vegetables (the acronym CROPP originally
stood for Coulee Region Organic Produce Pool) to dairy, juice,
eggs, meat and soy products. Sales have exploded, from $28
million in 1998 to $156 million in 2003 to $206 million in
2004, while pay prices to farmer-members, particularly for
milk, have stayed well above conventional prices and have
also showed greater stability from month to month and year
to year.
No doubt in part because this is a traditional dairy region,
Organic Valley's dairy segment has seen the most dramatic
growth and dominates the coop's public image. In addition
to fluid milk, it markets a wide range of organic dairy products
including buttermilk, whipping cream and a dozen kinds of
cheese. One method by which the coop has sought to distinguish
itself from its competitors is by creating regional production
and marketing linkages, so that milk from New England dairies
is marketed under a New England Pastures label, Rocky Mountain
milk under a Rocky Mountain Pastures label, and so on (other
regional labels include Northeast Pastures, Northwest Pastures,
Texas Pastures and California Pastures).
Missing from that list, you'll notice, is Midwestern Pastures,
but if you live in the Midwest you can be confident you're
drinking milk from your own region. Demand for organic milk
is highest on the Coasts, CROPP representatives explain, whereas
supply is concentrated in the Upper Midwest--a situation created
as much by demographics as by consumer preferences. Just as
Wisconsin's conventional dairy sector has survived by specializing
in cheese, CROPP makes most of its nationally distributed
organic butter and cheeses from Midwestern organic milk--thereby
creating a concentrated, higher-value product for shipping
and helping to even out the continental dairy imbalance. As
a result, not only Wisconsin farmers, but also Wisconsin dairy
processors--and in turn whole communities--have benefited
from CROPP's success.
Organic butter junction
Organic Valley's positive economic influence is clearly visible
30 miles to the west of La Farge, in the hamlet of Chaseburg.
When Organic Valley acquired the Chaseburg Creamery six years
ago it had been closed for 28 months—"a long time
for a small town like this," as the current creamery
manager, Dave Larson, notes, drawing a deep breath.
Today, with a population of just 302, Chaseburg supports
a church, a bank, a taxidermist, and a café, in addition
to the creamery. Just as important as the jobs the creamery
represents, Larson emphasizes, are the plant's contributions
to the local tax base. "I'd say we provide about 80 percent
of the payments for the water supply and septic facilities
here," he estimates.
Nearly all of the plant's 30-or-so jobs are held by people
local to the area. Larson himself lives six miles away. In
addition to being the Chaseburg plant manager, he's also a
farmer and an Organic Valley producer-member, milking 32 cows
and maintaining 3,200 laying hens.
Larson's job involves a good deal of traffic coordination.
The plant's central location "serves as a tipping point
for Organic Valley operations" in the United States,
he explains. "We operate very much as an on-demand facility,
making up shortfalls in the East and the West" as needed.
The facility produces about 22,000 pounds of butter a day,
packing under the Organic Valley label as well as store-brand
organic butter labels like Trader Joe's, one of the creamery's
bigger customers. With just one, modest-sized storage cooler
at the end of the packing line, Larson relies on a steady
stream of trucks shipping butter out, as well as bringing
milk in, to keep the process moving smoothly. "It really
requires a lot of teamwork," he emphasizes.
Like CROPP as a whole, the creamery has had to cope with
constant growth. "I don't remember a single month in
which we haven't been involved in some kind of expansion or
renovation," says Larson. When New Farm visited, construction
was underway to create a truckers' lounge (so drivers have
a place to wait while their milk is being unloaded) and to
install a bulk cleaning-solution system, with large fixed
tanks taking the place of removable 55-gallon drums.
You can track the plant's expansion by looking at the milk-storage
silos rising from the back of the creamery, Larson points
out. Initially, they installed a 20,000-gallon silo; next
to that stands a 30,000-gallon silo, installed sometime later;
next to that, the most recent addition, a 40,000-gallon silo.
Today the creamery has a total storage capacity of 750,000
pounds and is processing between 280,000 and 600,000 pounds
of milk a day. With no room for more silos, there's talk of
replacing the original, 20,000-gallon silo with a 50,000-gallon
model.
Good as gold
After we suit up in long white coats and hair nets and walk
through the shoe sanitizer, our tour proceeds backwards through
the plant, from finished to raw product, to ensure that we don't
track contaminants from the beginning of the line to the end.
The main production floor is a large square room with a terracotta
floor and big banks of glassblock windows. In the center of
the room stands an enormous stainless steel churn, a giant
horizontal spatula on wheels to remove the butter from the
churn, and a boat, or trough, into which the spatula unloads
its haul. To one side are five upright tanks in which the
cream is held prior to entering the churn; to the other is
the packing line, where the butter is squeezed and pressed
into waxed-paper-covered sticks and the sticks in turn are
packed into one-pound paperboard boxes.
Most of the people at work in the room are tending the packing
line, but the area in front of the churn is the domain of
Chaseburg's buttermaker, Tom Tollackson. Each churn-load uses
7,000 pounds of cream and yields about 3,500 pounds of butter.
"Batch churns [like this one] are a rarity nowadays,"
Larson yells above the din of the machinery. "Most plants
now operate continuous-production churns. These were originally
made in Québec. Now you'd probably have to go to Mexico
to find one." When the coop went shopping for equipment
for the creamery six years ago, he notes, they bought two
so they'd have a spare. Even so, they've had to have replacement
parts custom-fabricated.
It takes about an hour and a half to make a batch of butter
in the churn. First the cream thickens into whipped cream;
then, after the 30 or 40 minutes the butter starts to 'break'
or separate out from the residual liquid. The buttermaker
then drains the buttermilk off and continues churning the
butter until it reaches the right texture and firmness.
"It's much like cooking," Larson comments. "Anybody
can follow a recipe, but that doesn't mean it's going to come
out right." "Our producers do a really good job
of ensuring consistent quality milk," he goes on. Even
so, when pastures get lush in the spring and fall the cows
produce larger volumes of lower-fat milk, "and the butter
acts differently. That's where Tom's skill comes in."
The Chaseburg Creamery makes two types of butter: a salted,
uncultured butter and a cultured, unsalted butter. Salted,
uncultured butter is what most people are used to eating.
The salt—in this case an approved-for-organic flake
salt at a rate of 1 ½ percent—brings out the
butter's flavors while also acting as natural preservative.
Cultured butter has active bacterial cultures added to it,
just like yogurt. Traditionally, Larson explains, cultured
butter is unsalted, since the culture acts as a preservative
agent in place of the salt. "It's a live product,"
he points out, opening a stick of each type, fresh off the
line, for us to try. Sampled side by side, the cultured butter
tastes intensely fresh and sweet; the salted butter just as
fresh but salty-tart.
Identity and integrity
To begin its transformation into butter, the milk must travel
from the truck tanker to the creamery's storage silos, and
then from the storage silos to the separation and pasteurization
room. The creamery has two, fully enclosed truck bays, which
form an integral stage in the sanitation protocol for milk
handling. Each day, organic milk arrives here from small dairy
farms in Minnesota, Iowa, Wisconsin, and Illinois—around
five hundred farms in all. The trucks roll in, the doors close,
and the whole room and its contents are washed down before
the milk is unloaded, one truck at a time.
After the trucks leave, the room is washed down again and
heated to dry it out before the process starts over. It takes
an hour and a half to unload a truck of milk. Strict regulations
govern the sealing and unsealing of the truck tank valves
in order to maintain the cleanliness and organic integrity
of the milk within.
After being separated, the cream goes to the adjacent butter
room while the skim milk ships back out to be bottled, or
to be made into powdered milk or cheese. (Cream
is also sold to a local organic ice cream maker.) in They
run 31,000 pounds of milk an hour through the pasteurizer,
Larson explains; some milk is shipped back out unpasteurized
for raw cheese production.
Back in the butter room, the end result is a highly developed,
classic example of identity-retained marketing: Each individual
stick of butter is identified on its label as "organic
cultured unsalted sweet cream pasteurized Wisconsin Grade
AA."
The creamery is certified by Oregon Tilth. The single biggest
issue separating organic from non-organic milk handling, Larson
says, relates to sanitation materials. There's a fundamental
conflict between organic regulations, which seek to ensure
that no cleaning product residues remain in the pipelines
to contaminate the milk, and USDA dairy regulations, which
consider that if you rinse the lines after sanitizing, you're
no longer sanitized. The answer? Vinegar-based sanitizing
products that evaporate rapidly and completely.
"There's a little more record keeping," Larson
says of the certification process as a whole, but not much
more since all milk handlers are subject to regular inspections
by state and federal agencies anyway. "We're very fortunate
in that we're all organic here," he notes. "It saves
us a lot of time not having to worry about organic and non-organic
product getting mixed up."
Building a bigger barn
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A legacy of cooperation
Historically, Wisconsin has been known for its
progressive politics, strong cooperative tradition
and flourishing dairy sector. In 1887, the state
passed one of the first U.S. laws protecting cooperatives,
and in 1922 that legislation helped form the basis
for the Capper-Volstead Act, the landmark federal
law establishing the rights of producers to band
together for marketing purposes.
The history of Organic Valley's butter plant
illustrates in miniature the overall trajectory
of dairy production and processing in Wisconsin:
Originally founded in the 1920s as the Chaseburg
Cooperative Creamery, it was bought out by a larger
company called Tri-State in the 1980s and then
by Swiss Valley in 1997. According to the University
of Wisconsin Center for Cooperatives (UWCC), in
1917 there were 835 creameries in Wisconsin, of
which 380 were farmer-owned, and 1,929 cheese
factories, of which 718 were farmer-owned. Coops
received strong government support during the
Depression, and numbers rose until about the 1950s.
In the 1960s, the number of traditional farmers'
cooperatives began to dwindle. Some folded, others
merged. More recently, however, the first of what
researchers at the UWCC call "new generation
cooperatives" began to appear. New generation
coops are characterized by greater capital investment
on the part of farmer-members and greater attention
to meeting the specific demands of the market,
both in quantity and quality of product. These
traits are critical to survival in today's highly
competitive agricultural sector.
There are two dominant trends in the Wisconsin
dairy industry today, says the UWCC's Robert Cropp:
While some existing dairy coops and cheese plants
have survived by consolidating and cutting costs
to compete with the big dairies out west, others
have stayed small and found niche markets like
specialty, organic and grassfed products.
"In recent years we have seen an increase
in the number of small coops, and frequently it's
a group of farmers wanting to do something to
add value to their products," Cropp observes.
"Most milk in Wisconsin is made into cheese,
and 80 percent of Wisconsin cheese is commodity
cheese," meaning it's produced in large blocks
that are then sold on to another company to be
cut and packed.
Today there are 175 cheese plants in Wisconsin—again
with a slight recent increase in small-scale plants.
"[For] some of the cheese plants that Organic
Valley's using, [the coop's] business amounts
to a whole day's production in a weekly schedule,"
says the Center's Greg Lawless. "So they're
definitely having an impact." |
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Our tour guide for Organic Valley's new headquarters is Curt
Parr, manager of IT services and another local boy. A native
of the nearby town of Sand Hill (population 744), he attended
La Farge High School, then went off to college and worked
in Chicago for a few years before returning home and taking
his present job in 2003. His wife also works for the coop,
and his family's farm—managed today by his father, siblings
and nieces and nephews—has transitioned to organic and
sells milk, meat and produce through Organic Valley.
Parr has vivid memories of growing up during the 1980s Farm
Crisis and watching neighboring farms go under one by one.
His father accepted the federal Dairy Buyout of 1985, then
returned to dairying in 1991. In 1997, his dad "got on
the truck" with Organic Valley. "One of the things
Organic Valley really emphasizes is diversity on the farm,"
Parr explains, adding that it was in response to that encouragement
that his family's farm diversified into beef and vegetables.
The promise of organic markets in general, and Organic Valley
as a way of reaching those markets, means that "now there's
an opportunity to be successful in farming again," he
says.
The new headquarters building sits on a 34-acre site at the
top of a rise above the town of La Farge. Before relocating
here in August 2004, the co-op's offices were spread across
seven La Farge locations. Needless to say, the IT staff's
jobs have been vastly improved by the move. "The goal
was to get everyone from seven buildings into one building
and use 25 percent of the energy," says Parr.
The building itself is essentially a long metal pole barn—it
was, in fact, constructed by Morton Buildings, Inc., of Dodgeville,
Wis.—with half of a post-and-beam barn tacked on to
the middle of one side and an uncommon amount of thought put
into the interior. The timber-frame transept forms a two-storied,
sun-filled main entrance; the kitchens, restrooms, and stairwells
are concentrated in the crossing; workstations, offices, and
conference rooms spread to each end of the main barn.
The headquarters was designed to be not just a model of energy
efficiency but also an exercise in "building local."
The structure joins just three others in Wisconsin to meet
LEED standards (Leadership in Energy and Environmental Design)
for energy conservation and environmental impact, and all
materials were sourced within a 500-mile radius of La Farge.
All of the timber, including the window frames, was obtained
locally. The building is oriented to optimize natural light
and heat; most of the grounds are seeded to prairie grasses
and forbs. Even the workspace dividers were obtained second-hand
from another company.
The new headquarters currently houses around 180 employees;
maximum capacity in its current configuration is 225. The
cooperative expected to have space to grow here until 2008,
Parr says, but it's already apparent that the building will
fill up well before then. "We're really good at dealing
with change," says our guide cheerfully, showing us a
training room filled with computer workstations. "We
hired new 73 people last year. Training is one of the most
important things we do."
Organic Valley's former headquarters (still known as the
'Main Building,' because it sits on Main Street) is now home
to a small retail shop for OV food products, some remaining
office space, and a cheese cutting and packing facility. The
coop's cheeses are custom-made by a number of different processors
in the region, but they all come back here to be graded and
packed. Like the rest of Organic Valley's business, cheese
sales have grown steadily: The cutting and packing facility
currently handles 150,000 pounds of cheese a month, running
two shifts a day; and there's talk of rounding out the schedule
with a third. "We could contract out some of the packing
and labeling," says one facility employee, "but
then we wouldn't have our arms around it."
Such are the ingredients in CROPP's recipe for success. By
hiring locally, encouraging farmer-members to diversify, renovating
a small-town creamery for butter production and relying on
the state's strong dairy processing sector for their cheeses,
the organic coop has managed to draw on its native territory's
strengths in order to stay competitive in an increasingly
challenging marketplace. All in all, you could say they fit
right in.
Laura Sayre is senior writer for NewFarm.org. |
