Making a market: cancelled contract encourages one dairy farmer to sell direct to the public

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Lot Hill Dairy Farm near Seymour, which is owned by the Claycamp family, has been around since 1966, and for most of that time, it was a fairly conventional 60-cow dairy farm.

Then, Dean Foods announced that effective May 31, 2018, it would terminate the milk marketing contracts of 100 dairy farms in eight states. Nearly 30 of those farms were in Indiana – and one of them was Lot Hill Dairy.

“We contacted four or five other dairy co-ops in the area, and everybody said ‘No new members,’” said Jon Claycamp. There was simply no place to sell their milk.

Fortunately, Claycamp had a dream of marketing dairy products directly to the public. Even more fortunately, by the time the Claycamps’ contract with Dean was terminated, he had already taken steps to make that dream come true.

So after the last Dean pickup on May 31, Lot Hill rolled right into direct marketing, selling gelato, cheese, spreads and butter from a building on the farm and at the Seymour Area Farmers Market.

LotHillDairy_0013“Thankfully I had this building done and approved,” Claycamp said, indicating the cabin that houses his retail shop and small-scale processing equipment. “The last pick-up was May 31, and we were approved (by the State Board of Animal Health) June 1, so it all worked out.”

“Work” is the operative word here because it turns out that making dairy products – particularly cheese – is time-consuming.

Claycamp had been making gelato on a small scale before June 1, but he found that full-time processing was different. He had planned to handle both the milking and the cheese-making, but it turns out cheese-making is pretty much a “12 hours-plus” job.  

Eventually he hopes to streamline the process with new equipment and hired help, but currently all of the work is done by Claycamp and his father, Bob, who handles the milking.

As part of the move to direct marketing, the Claycamps downsized their milking herd from 60 cows to 30. All the milk produced on the farm goes into their own products.

When asked if he’s made a living on the direct sales, Claycamp said it’s actually been going very well so far – but that was through the summer.

“I knew all along that come winter, we’d have to have some stores,” he said.

By stores, Claycamp means grocery stores. Lot Hill is making its first steps into that arena this winter when its cheeses, spreads and butter will be sold from special coolers in two nearby Jay C stores (which are owned by Kroger).

“It’s not Kroger. It’s still my baby to take care of. The cooler is my expense, maintenance on the cooler is my expense. Basically, they’re marking my product up and for that mark-up, they’re giving me a corner there in the store,” Claycamp explained.