“The general trend for smoked cheese is exploding,” said Daniel R. Culligan, president and CEO.
The company processes about 10 million pounds of smoked Gouda annually, the most of any producer in the country, Culligan said, and one of its smoked Gouda spreads was a runner-up in its category at the U.S. Championship Cheese Contest in March in Green Bay.
Dairyfood doesn’t make its own cheese but instead buys it in bulk from producers in the Upper Midwest and processes it into its products, most of which are sold under other companies’ brands.
In addition to Gouda, Dairyfood’s extended-life cheese products include smoked cheddar and smoked provolone, snack items like cheese wedges, sticks and bars, and dips and spreads in a plethora of flavors and package sizes that range from less than an ounce to two pounds.
But Dairyfood is not a household name because most of what it produces are so-called private label and co-packing products made for large clients that sell it under their own brand names. Culligan declined to name the companies Dairyfood processes cheeses for, saying its clients prefer their arrangements to remain confidential.
A smaller part of Dairyfood’s business — about 13 percent, Culligan said — is selling cheese products under Dairyfood’s own house brands, including Glacier Ridge Farms, Dutch’s Choice, Cheese Festival and Queso de Casa.
Revenue in 2017 will exceed $50 million, he said, a 35 percent increase over revenue in 2012, he said.
Dairyfood was founded in Blue Mounds as Stauffer Cheese in 1953 by Alex Stauffer, a renowned Swiss cheesemaker who fled Europe during World War II, leaving behind “an empire” of 18 plants, Culligan said. Stauffer Cheese was acquired by a large Austrian dairy co-op in 1982, a descendant of which still owns Dairyfood.
Culligan said Dairyfood’s plant could be anywhere and could be more efficient in a larger metropolitan area. But the company was founded in Blue Mounds, he said, and that’s where it stays.
Dairyfood USA is partially owned by an Austrian holding company called Biomerx GmbH. What are the advantages of that?
Having an international partner provides our company with yet another perspective of the global dairy industry. At its core, the dairy industry’s perpetual drive to optimize production has led to a willingness to adopt new technologies that enable more to be done with less. When it comes to processing and packaging operations, dairy manufacturers are keenly focused on improving operating efficiencies. Having access to professionals from other countries can only be beneficial in improving our own company here in the U.S.
Do you think of yourself as a Wisconsin company or an international one?
We definitely consider ourselves to be a Wisconsin company. While our company’s roots are founded in Europe and we have Austrian shareholders, the company operates with complete autonomy here in the U.S. The vast majority of the facets of the company, be it market development, equipment acquisition, banking relationships, employee recruitment/development and operational functions, are all conducted by the management in the U.S., with minimal input from Europe.
Our unemployment rate in Wisconsin is relatively low. Does that make it hard for you to hire skilled workers?
The most pressing issue that our company faces is the lack of qualified, dependable labor. Given the 3.4 percent unemployment rate in Wisconsin and 2.9 percent in Dane County, coupled with our rural location, it unfortunately provides a backdrop for a very challenging situation.
How does the cheese process work?
Producing extended-life cheese is basically very simple. Dairyfood USA purchases bulk cheese — primarily cheddar, Monterey Jack and Gouda—in 500-pound barrels or 40- or 640-pound blocks. The primary source of our bulk cheese comes from the upper Midwest, namely Wisconsin and Minnesota. The natural cheese is placed in a vessel where the cheese is pasteurized and emulsifying salt and natural flavorings (in some cases) are added. At that point a chemical reaction ensues and an emulsion is created. The emulsion is then transferred into various cups and configurations, depending on the final product. The product is then cooled and, after several days, is ready to be shipped to the final customer.
Q. What are your newest favorite products?
A. One of our newest products is our line of Queso de Casa White Dipping Cheese. … Another exceptional item is our smoked Gouda spread. We were recently awarded second place in the U.S. Championship Cheese Contest for that category.
Q. With all the artisanal cheeses made in this state, how do you distinguish your products?
A. There is no doubt that Wisconsin is blessed with a large number of artisanal cheese producers. Fortunately, there will always be a demand for extended-life cheese products, due to concerns of handling issues for natural products, increased merchandising and marketing opportunities. And it is, quite frankly, more appealing to particular markets. Dairyfood’s goal is to produce cheese products that replicate the flavor and texture of natural cheese, but require less concern of handling, improved melting functionality and the extra margin of safety associated with the methodology we employ in production. Dairyfood USA is one of the few companies in the U.S. that naturally smokes cheese. Popularity of smoked cheeses continues to grow significantly in the United States, and sales of Dairyfood USA’s smoked cheeses have followed suit.
Q. What world events have an impact on your business?
A. Several years ago, China’s imports of dairy products rose dramatically, resulting in significantly higher prices in the U.S. due to the lack of supply. Feed costs and the U.S. ethanol boom have resulted in similar consequences. Weather conditions such as drought can also dramatically affect worldwide supply. Lastly, currency fluctuations have also been known to markedly affect supply, demand and subsequently pricing.
Source: Wisconsin State Journal
Link: http://host.madison.com/wsj/business/executive-qa/life-is-gouda-as-smoked-cheese-boom-buoys-blue-mounds/article_e3ff5863-b3f8-5d41-a057-f282f04730e2.html
