Dairy Sector Helps Drive Indiana Economy

Steve Obert is a fifth generation farmer in Gibson County where the family operates Obert Legacy Dairy. When he’s not tending to the 1,200-cow herd, the veteran dairy operator is leading efforts to promote and support Indiana’s 750 dairy farms. In May 2021, Obert took over as executive director of Indiana Dairy Producers, an advocacy group representing Hoosier dairy farmers.

In an interview with Inside INdiana Business, Obert said Indiana residents who are not connected to agriculture may not understand its value as an economic engine.

“I think agriculture and in particular, dairy is a little bit overlooked when it comes to the value of creating economic activity in our communities,” said Obert. “Dairy farms are located in the most rural areas of Indiana. For a lot of them, that is the economic engine of a community.”

According to the Indiana State Department of Agriculture, dairy is the fifth largest commodity in Indiana, totaling $750 million in sales, or about seven percent of total agricultural product sales. In comparison, corn represents 31% of the value of sales from Indiana farmers.

“Dairy families are a tremendous asset to our rural Indiana communities,” said Obert.

Obert took part in a tour earlier this week to examine Indiana’s dairy industry through three dairy-related operations in Elkhart County, including two dairy farms and a milk processor.

“It’s not every day you can take a group to a dairy farm with on-farm processing of cheese, milk, and ice cream, a dairy farm with a digester, and one of the Midwest’s largest providers of fluid milk that goes into brands we use every day. In one day, we were able to show the depth of the Hoosier state dairy community,” said Jenni Browning, chief executive officer of the American Dairy Association Indiana.

The ADAI cohosted the tour with the Indiana State Department of Agriculture to allow state lawmakers, economic development officials and other stakeholders to examine what role the Indiana dairy sector plays in the state.

“We’ve got legislators that have been on the trip today. That helps them better understand the industry that’s within their districts,” said Indiana State Department of Agriculture Director Bruce Kettler.

In 2015, the ISDA commissioned a study to examine Indiana’s dairy industry. In December 2020, the agency released an updated version. Indiana Dairy Strategy 2.0 took into account how the COVID pandemic dramatically impacted the industry as a whole. As schools and restaurants closed, demand for fluid milk and other dairy products took a dramatic hit.

“The extent of these disruptions and the duration of their impacts are as unknown and difficult to accurately predict as the long-term impact of the COVID virus itself but are important to recognize in the context of any forward-looking strategic plan for the state’s industry,” stated the executive summary. “Producers and processors were faced with having to manage unexpected surpluses and additional marketing costs caused by the disruption to normal marketing channels.”

Kettler says the strategy revealed the need for Indiana’s dairy farmers to examine ways to diversify their operations.

“We looked at some data that said that things like adding value to milk products in the state of Indiana would be useful. Of course, there’s various ways to do that, including on farm processing, and that kind of became evident in that information that we pulled out for the strategy,” said Kettler.

There are 750 licensed dairy farms in Indiana, ranging in herd size and scope operations. The state ranks number 15 in terms of the amount of milk produced.

“We’re working to make Indiana the most desirable state in which to produce milk,” said Obert. “It’s important to recognize that I didn’t say that we necessarily want to be the largest dairy estate, we want to be the most desirable.”

Obert says to reach that goal requires cooperation within state government, including elected officials and regulatory agencies. Click here to view the Indiana Dairy Strategy 2.0.