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South Dakota Works to Expand its Dairy Industry

According to the International Dairy Food Association, the dairy industry has an economic impact of more than $628 billion annually in the U.S. In trying to identify the states with the biggest impact on that figure, you might say Wisconsin or California. 

But another state is adding value by growing its dairy footprint: South Dakota.

Vikram Mistry, head of the dairy science department at South Dakota State University (SDSU), has seen an increase in the number of students in his classes. 

“Historically, we held steady with about 80 to 90 students between 1979 and 1986. This dropped by 2002 to about 40 following the Whole Herd Buyout program in 1986,” Mistry says. 

This was due to the decrease in dairy cow numbers from 250,000 to nearly 80,000 head by the early 2000s. Those numbers have grown back to 122,000, and the university has also seen renewed interest in its dairy program following strong recruiting. Today, there are 125 students from 13 different states.

David Skaggs, dairy and ag development specialist for the South Dakota Department of Agriculture, says when dairy farms decreased in the early 2000s, his department made it a priority to rebuild this part of the industry by adding staff in dairy development. Realizing this priority is what has helped increase cow numbers from the low of 80,000 up to 122,000 head today.

“While we have made it a priority to build the dairy industry in South Dakota, we’ve also made it a priority for these operations to be family-owned,” Skaggs says.

The dairy processing industry has increased in South Dakota, as well.

Agropur, which supplies all the mozzarella cheese to the Papa Murphy’s pizza chain east of the Rocky Mountains, expects to open its expanded plant in Lake Nordon, South Dakota, in early 2019. The growth is expected to have a $1 billion economic impact on the state. According to an Agropur news release, this project increases the plant’s daily milk processing capacity from 3 million pounds to more than 9 million pounds, equal to the output of an additional 85,000 cows.

Valley Queen Cheese Factory Inc. in Milbank, South Dakota, is also enlarging its facility and will increase processing by 25%, equal to up to 5 million pounds of milk per day, also in early 2019.

Another contributor to growth is the number of milk buyers in the state. 

“You take a look at some of the other states that lead in cow numbers, and they only have four or five milk buyers,” Skaggs says. “In South Dakota, we’ve got six who are buying milk and hauling it to nine different plants. Our dairy producers are very fortunate to have a better pay price than the national average (because of the large number of buyers).”

Mistry and Skaggs agree that the continued increase in the world’s population will lead to more opportunities in the food sector, which will help build more markets for dairy foods. 

“We have to train managers for operations in milk production and processing. They have to be business savvy and technically savvy to help increase the supply of milk and to do it efficiently,” Mistry says.

“As we move forward, we want SDSU and South Dakota to continue to be leaders in how we get the most nutritional value out of a drop of milk,” Skaggs says.

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