Creamery business booms during COVID-19

By Matt Reese

Luke Jackson just finished up his sophomore year of high school at home and did not get to spend much of his spring on the baseball diamond with his teammates like usual. Not much has been usual, after all, in the spring of 2020.

Luke loves sports of all kinds and has missed the athletic activity, but the coronavirus that kept him off the athletic fields also helped double the demand for his family’s Indian Creek Creamery in Logan County. As their new business boomed in recent weeks, Ray and Colleen Jackson were glad to have some extra help on the more than 70-head dairy farm from their two sons (Luke and Samuel, a student at Calvin University in Grand Rapids) who were both home from school due to the pandemic.

Ray has been involved in the dairy industry most of his life

and milking on the Logan County farm since 1991 and, in recent years, saw a need to respond to the increasingly challenging market conditions for milk. The Jacksons had a family meeting with their children a few years ago. They either had to do something differently, or get out of the dairy industry. The family decided they wanted to set the stage for a possible future for the four children — two boys and two girls — to continue in the dairy industry on the farm.

“We were in a position to either get out of dairy or try something different and risk failing,” Ray said. “I have spent most of my career trying not to fail, and I have come close a couple of times.”

By 2016, they had tested for A2 milk genetics in their cattle added a second bulk tank to store it separately and sell it for a premium. Soon after, the Jacksons began the process of transforming an empty fruit packing shed across the road into an approved processing and bottling facility for the creamery. The effort took time, plenty of financing and ample hope for a brighter future on the farm. In early 2019, the creamery was up and running, selling half gallon jugs of Grade A whole milk to retail outlets directly from the farm.

“Most places, if they didn’t already have a similar product on their shelves direct from a farm, were pretty receptive to selling our products,” Ray said. “I had more luck initially in the Cincinnati area than in Columbus because they were already selling similar products in many of those stores around Columbus.”

Their milk is very unique to many consumers because it is not homogenized. It is also flash pasteurized at 171 degrees F for 18 seconds before being quickly cooled. The quality and characteristics of the resulting product closely resemble raw milk, while still meeting strict safety standards.

The Jackson’s mostly-Holstein herd has access to pasture. Their cows are fed on-farm feed ingredients from the crop rotation heavy in cover crops including corn, hay, rye and triticale. The diverse rotation is necessary for meeting the feed needs of the dairy and also beneficial for soil and water quality.

After the first year of operation, Indian Creek Creamery was selling around 1,000 bottles of milk a week through direct deliveries to stores and through Market Wagon, an online farmers market offering delivery to give consumers more access to local foods. Then, everything changed in late March.

“It was right when the effects of the coronavirus were just hitting and there was no milk in the stores. I was like a superstar walking in when I had milk to sell — the only milk there was to buy in the store,” Ray said. “That day our business doubled. We sold everything we had and had to go back home and bottle again. We went from selling 1,000 bottles from one day a week of our milk production to two days of production and around 2,000 bottles. I knew once those new customers tried it they would notice a difference and we kept about half of those new customers. Since then we have gotten back up to that initial spike and maintained that level of sales.”

Now the Jacksons are milking every day, delivering three days a week and bottling two days a week, along with planting season. The workload to get the new business up and running has been significant.

“My wife and I haven’t been able to take a vacation together for years because we can never both be gone at the same time,” Ray said.

The hours are long but they are seeing their massive investment of time and resources starting to pay off.

“We fortunately built a large enough processing facility to be able to handle this increase that happened so quickly,” Ray said. “The creamery was in the red for about six months and the recent increase in sales brought the operation as a whole out of the red. Now we have a lot of holes to fill to keep it running, but there is still plenty of potential to expand.”

The milk produced on the farm that is not sold through the creamery is sold at market price to Pearl Valley Cheese. The Jacksons would like to continue to see the creamery side of the business grow.

“We’ll continue to the increase in bottling as we can. We make more from the two days of milk we sell through the creamery than we do for the other five days a week of milk production combined,” Ray said. “That shows you, one, how tough it is for the rest of the dairy industry and two, that there is real potential with offering a premium product directly from the farm.”

The non-homogenized milk is so unique that there is a bit of a learning curve for Indian Creek customers.

“Cream is our thing, because we don’t homogenize. People really like that, but we have had to re-educate people about shaking up their milk. Even if you love the cream it can take some getting used to,” Ray said. “I have told some of the stores to display the jugs on their sides so the cream layer is not so thick up in the neck of the jug. When they are laying on their sides the cream has more surface area to spread out.”

The Jacksons are also looking into larger sized packaging for selling bulk to restaurants and coffee shops. Just developing the labels and finding BPA-free plastic packaging has been an extensive amount of work and expense.

“They love our milk, but restaurants do not want to have their trash cans filled with half gallon milk containers because they use so much,” he said. “I have started to look at larger 2-gallon bags.”

The A2 milk Indian Creek offers is being increasingly sought after by those who have milk sensitivities and for the perceived health benefits. The A2/A2 milk is sold for a premium price above their non-A2, bottled milk.

While business has blossomed for the Jacksons, much of the rest of the nation’s dairy industry has been pummeled by the pandemic. Dianne Shoemaker, an associate professor at The Ohio State University College of Food, Agricultural, Environmental Sciences who specializes in dairy production economics, said wholesale demand for milk plummeted when schools and restaurants closed in March. At the same time, retail demand for milk spiked and consumers emptied grocery store shelves. The sudden backup in the supply chain led several U.S. dairy companies to tell dairy farmers to dump their milk that had no place to go as processing plants struggled with the rapid demand shift. The first milk dumping in Ohio began the weekend of April 4 and took place for some farms in Ohio until April 20, Shoemaker said. About 64 Ohio dairy farmers dumped anywhere from one to four of their typical shipments.

Milk prices have been low for the past five years, Shoemaker said. Since 2015, Ohio has lost more than 1,000 dairy farms and 16,000 dairy cows, and the events of recent months have not helped reverse the situation for most of the dairy industry.

Meanwhile, the Jacksons are glad to have their boys home from school (and their daughter Ella helping with marketing) and hope for future generations to be able to work on the dairy farm, though there are currently some added production expenses.

“I call the boys cereal killers because they eat so much cereal and drink so much milk. I make Luke drink the milk out of the bulk tank to save on the packaging. He drinks a lot of milk. When I can get his time away from sports and on the farm, he is really great help. They both are,” Ray said. “Any farmer, whether they are adding new equipment or putting up a new building or investing into the farm is looking to the next generation. That is what we are trying to do with the creamery.”

For more about the operation and to find retail locations, visit https://www.facebook.com/Indiancreekcreamery/.