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Organic Valley rides 'biggest surge ever'

Organic Valley CEO George Siemon tells farmer members during CROPP’s annual meeting at the La Crosse Center Thursday that prospects continue to rise as organic products move into big box stores and increasing numbers of U.S. homes. Demand for butter and grass-fed dairy products are among the driving forces, he said.

Organic Valley’s business was “never better than now,” coming off of its first billion-dollar year and riding the “biggest surge in the market we’ve ever seen,” CEO George Siemon says.

“At 27 years, you’d think the surges would be over,” Siemon said during a press breakfast Thursday before addressing more than 500 farmer members at the La Crosse Center during the annual meeting of the La Farge-based Cooperative Regions of Organic Producer Pools that is Organic Valley’s umbrella.

Instead, organic products are finding their way onto shelves in increasing numbers of general merchandise grocery stores, as well as the big-box outlets such as Costco, Siemon said.

“Everybody in the food business is falling over each other to see who can be the most organic,” he said.

Costco has become the leading retailer for Organic Valley’s family of products, he said, adding, “The good news is that consumers are reacting. Consumers used to buy just milk and yogurt.”

Now, customers want other organic dairy products, such as butter, cream and cottage cheese, as well as organic meats and produce, Siemon said.

“It’s a lifestyle change all the way through,” he said.

That is a boon for organic farmers, especially with the price of milk for farmers using conventional production at $15 a hundredweight, compared with the $35 premium price Organic Valley pays its members, Siemon said.

“It’s awesome to see farmers prospering — not just breaking even, but prospering,” said Siemon, who founded, with a handful of other farmers, what they then called the Coulee Region Organic Produce Pool in 1988 with the belief that organic farming would provide a sustainable method of agriculture to help family farms that were facing hard times.

CROPP now has 1,850 farmer members throughout the country and hopes to add another 300 within the next year, he said.

“Organic Valley has become a great change agent in the nation,” he said, as a major player in shifting sentiment toward organic products as a healthier option.

Of breaking the billion-dollar ceiling in mid-December — actually, the year-end tally was $1.04 billion in gross sales, compared with $974 million the previous year — Siemon said, “We never dreamed we’d be at $100 million, let alone a billion.”

Now, Organic Valley officials are preparing to accommodate continuing growth.

The co-op may build a new processing facility in Cashton geared to increasing demands for butter, he said.

About 250 employees moved into the co-op’s new office building in Cashton when it opened this month, although it was built with a capacity of 400, said Jerry McGeorge, cooperative affairs vice president.

“There is plenty of room for growth,” he said, noting that the co-op also is known for its concern for its 850 employees, with Outside Magazine ranking it 38th on its list of 100 Best Places to Work.

Organic Valley did especially well in the category of employee health and wellness, which dovetails with organic farming’s reliance on healthy soil, which in turn passes on to make it a healthy company, he said.

The company also nurtures healthy relationships between its employees and its 1,850 family farmers in 36 states, he said.

Tucker and Becky Gretebeck, who have an organic dairy farm near Cashton, revel in the CROPP relationship.

“The support is like none other,” Becky said. “When we don’t know what to do, there always is somebody you can call.”

The Gretebecks transitioned their farm to grass-fed cows, a process that is time-consuming and potentially risky because foraging cows typically produce less milk. On the other hand, such farmers realize savings because they don’t have to buy grain, and forage crops eventually require less plowing to be sustainable.

“There are fears that go along with grass-fed, even with savings,” said Tucker, who describes organic farming as “like going to college every day.”

“In the back of my mind, it was a gamble I was willing to take,” he said. “We had to understand the losses we were going to take the first few years.”

Having switched, Tucker characterized the results as “fantastic,” and Becky said, “The cows have never been healthier.”

Organic Valley contracts with grass-fed operations stipulate that the farmers must spend part of their profits on improving the soil, Siemon said.

“Grass milk is the next evolution of organic,” he said.

The method has environmental pluses, too, he said.

“Grass-based farming is a solution for climate change,” he said, because taller grasses help remove carbon dioxide from the atmosphere, and less plowing decreases pollution and erosion.

Another sector that Organic Valley is poised to grab a bigger share of is produce, with the co-ops increasing members throughout the country, which expands growing seasons.

“The past few years, our produce has been going from local to national,” Siemon said. “The big breakout for us was hard to do with product only five months out of the year.

“Produce breaking out of natural foods into the mass market is exciting,” he said. “It’s exciting to see after 27 years of incubating it, it’s coming alive.”

“The good news is that consumers are reacting. Consumers used to buy just milk and yogurt. .. It’s awesome to see farmers prospering — not just breaking even, but prospering.” George Siemon, Organic Valley CEO

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Reporter

Mike Tighe is the Tribune newsroom's senior citizen. That said, he don't get no respect from the cub reporters as he goes about his duly-appointed rounds on the health, religion and whatever-else-lands-in-his-inbox beats. Call him at 608-791-8446.

(1) comment

chucker

Thanks to Government loans & grants by us taxpayers and to think it was started by a bunch of smoking Hippie's !! So how munch are they paying back the taxpayers ???

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