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Arethusa Farm changes business model to preserve quality, assist smaller dairy farms


The showcase dairy barn at Arethusa Farm in Litchfield has been closed as the farm transitions to a new way of doing business, using milk from other farms to supplement its own product. John McKenna Republican-American

Arethusa Farm has closed its showcase dairy barn, sold off 110 of its prized milking cows and is importing milk from two other Litchfield County dairy farms to supplement its own production.

It’s the new way of doing business at the award-winning farm owned since 1999 by George Malkemus and Anthony Yurgaitis. The model is designed to make milk production more financially-efficient and sustainable without sacrificing quality and quantity, the partners said, while also helping other farms during a difficult time for the dairy industry.

The coronavirus pandemic has dropped demand for milk while regular consumers including schools and restaurants remain closed.

“As milk prices started to drop, Tony and I began considering the idea of using satellite farms for milk,” Malkemus said, adding that he and Yurgaitis have always felt a fiscal and moral obligation to assist smaller dairy farms.

Arethusa has begun supplementing milk produced in its smaller dairy barn on Webster Road with milk from Birch Mill Farm in Falls Village. Milk will begin arriving from Carlwood Farm in Canaan on Tuesday.

The two farms, which will benefit financially under the arrangement, were chosen after much research and tours by Malkemus, Yurgaitis and Arethusa staff.

“Their standards for milk are equal to ours and the way they maintain and treat their cows is the same as ours,” Malkemus said. “They’ve been trained to milk like we do and we’re quite happy with the way it is working out.”

John McKenna Republican-AmericanJersey cows, which are known for producing sweet milk, graze in a field at Arethusa Farm in Litchfield on Friday. Arethusa has begun supplementing milk produced in its smaller dairy barn with milk from other farms.

Tim Kinsella’s Birch Mill Farm has been supplying Arethusa with milk for two weeks.

“We’re a small farm, but we can provide the quality of milk they need,” Kinsella said.

Carlwood Farm, where fourth generation farmer Sandra Carlson Boardman said she is proud to have been asked by Arethusa, will supply what will amount to about 5,600 pounds of milk from the family farm every two days. That’s about 700 gallons destined for an Arethusa production line featuring milk, cheese, ice cream, yogurt and other dairy products.

Milk from Carlwood Farm and Birch Mill Farm, still under contract with the Agri-Mark milk cooperative, is shipped directly to Arethusa’s dairy plant in Arethusa trucks. Both farms will be paid premiums on top of what they are paid by Agri-Mark.

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“It will mean the milk is a day or two fresher,” Boardman said. “It’s a good deal for both of us.”

Arethusa, Boardman said, was thorough in its review of her milk-producing operation.

“They did their homework,” she said. “It is very labor intensive and expensive for them to produce milk without growing their own feed. They found they could buy quality milk cheaper than making it. We grow our own hay and corn so we don’t have that added expense.”

The offer from Arethusa was motivated in part by Carlwood’s relatively high butterfat content in its milk, from a combination of 50 milking jersey and Holstein cows. It couldn’t have come at a better time.

As a result of the COVID-19 pandemic and a forced lowering of production by Agri-Mark, the recent milk check Boardman received was $4,000 less than it would otherwise have been. “It’s a win-win situation for both of us, and I am excited about it,” said Boardman, whose daughter Rene completed an agricultural internship at Arethusa.

The showcase dairy barn at Arethusa, which includes a wall of jet-engine-size fans that kept 80 cows cool in the summer, was too large and inefficient to justify keeping it open, Malkemus said.

The coronavirus outbreak and its economic effect on dairy farmers further contributed to the farm’s decision to outsource milk.

“The world is a troubled place and farmers are dumping milk,” Malkemus said of a dairy industry strangled by processing plants that can’t be converted for fluid-milk production.

Plants such as the Agri-Mark facility in Springfield, Mass., which produced dairy products for shuttered restaurants and schools, as well as dried milk for overseas markets, can’t change production lines to answer the demand for fluid milk.

By lowering overhead costs and outsourcing milk, Arethusa will be able to more effectively meet demand for its products, a demand Malkemus described as “insatiable.”

“Things have never been better at Arethusa,” he said. “We love the people who work for us and they’ve been going gangbusters making and shipping more product than ever, so we’re in a pretty good place right now.”

Buying milk produced at other farms and selling it under the Arethusa label is a major change of course for Malkemus and Yurgaitis, whose carefully bred and cared for herd has yielded a sweet product that has earned their farm numerous distinctions from the dairy industry and made it one of Litchfield’s main attractions. Arethusa’s “Milk Like it Used to Taste” branding remains in place as the transition to the new production model takes shape.

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Selling cows is nothing new for Arethusa, Malkemus said, as the farm deals some of its herd every few years. Malkemus said Arethusa has sold 110 cows to other dairy farms, leaving the farm with a herd of about 350. Seventy-five of the cows are currently being milked, he said, or 45 less than the 120 that were being milked when the showcase barn and the Webster Road barn were operating in tandem.

Arethusa’s dairy stores in Bantam, New Haven and West Hartford are thriving, and supermarket sales are strong, Malkemus said.

“The demand is exceeding our ability to make the product,” he said.

Plans are in place to open additional dairy stores in Westport and Westchester County, N.Y., he said.

Source: RA


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