By KATHERINE KARLSON, kkarlson@stny.rr.com

Ice cream — cool, creamy, and chock full of happy memories — has created new business opportunities for several state dairy operations in both retail and wholesale markets.

As Katie Ives of Ives Cream Parlor explains, it goes well beyond “we’ve got milk, we can make ice cream.” She began ice cream marketing research in 2002 as an integral part of a larger financial plan to add value through product diversification to the 150-year-old family farm. Greenview Farms LLC of Guilford is a partnership between her husband, Alex Ives, his father and cousin. The dairy operation milks 100 Holsteins, and they also raise about 350 acres of corn and 600 acres of hay.

“We started calling people on how to get started on ice cream, and we ended up at Morrisville State College, which is the only place we could come to experiment and begin production,” said Alex Ives, who spends a nearly 14-hour day every two or three weeks processing the ice cream base mix from milk, cream and other ingredients.

Greenview Farms supplies all the milk needed for ice cream production. Once processed, Alex Ives takes the prepared mix back to the Norwich parlor where it’s made into small batches of 20 different flavors.

Ives Cream began selling its initial four flavors wholesale in 2004. The Ives purchased a three-story downtown Norwich building in 2005, completed renovations last year, then launched the 1,200-square-foot retail store. The wholesale operation was put temporarily on hold until some packaging issues are resolved, said Katie Ives.

Ives Cream has a redesigned logo — a milk can that Katie calls “our Nike swoosh.” Their motto is “The ice cream that takes you back,” and that theme is echoed in the interior, which resembles a barn with milk can tables and hand-hewn post and beam ceiling and walls. “It recalls a simpler, quieter time and people come here to relax as well as enjoy ice cream,” she added.

“The plan is to get the kinks out of the retail operation and then duplicate it elsewhere,” Katie Ives said. They struck a deal this spring to open a mini-parlor in NYSEG Stadium in Binghamton, for which Katie developed two special flavors: B-Met Creamsicle and Peanuts & Cracker Jack.

Further up Route 12 in Lewis County, a consortium of nine dairy farms pooled their investments to purchase a well-known ice cream manufacturer’s facility in 2001, and the results are more agriculture jobs than ever before, said Roxaina Hurlburt, a member of Quality Dairy Farms, Inc.

The owners of Mercer’s Dairy in Boonville were ready to retire then, and Quality Dairy Farms were looking to start ice cream production, based on an earlier feasibility study. “The plan was to make 1 million gallons of ice cream a year using our own milk, but because only a third of ice cream is milk, we decided to use the milk from only one or two farms. When the business starts to make a profit, we will divide them equally between the partners,” she added.

Since its new beginning in 2002, Mercer’s Dairy has not only expanded its own line of ice cream, but also produces both base mix and final ice cream for private labels. Two new clients may require them to schedule another shift, Hurlburt said. The plant recently underwent a major retooling and upgrade to handle the increased production, she added.

“We’re down to eight dairies now, and three of them have sold their cows, but they all work for the company,” Hurlburt said. Currently, there are 18 employees in production and administration and 20 part-timers in the retail store.

Mercer’s unique offering is wine ice cream, produced according to state alcohol regulations. The wine comes from the largest winery in the Hudson Valley.

“It’s an adult dessert that we offer for catering, home parties or restaurants,” Hurlburt said.

The wine ice cream won as “Best New Product” and “Best in Show for New Product” at the Great American Dessert Expo in Atlanta in early June, she added.

Two domestic distribution centers already carry this wine ice cream, and international distributors are showing considerable interest, she added.

The advantage Suzanne and Chris Holcomb saw in making super premium ice cream over cheese was the shorter time to market and less competition. The couple started dairy farming in 2003 with a herd of about 30 Guernseys.

“We wanted to make something with milk, and when we researched different products, we found many small farms make specialty cheeses, but not too many do ice cream,” said Suzanne Holcomb of C&S Farms in St. Johnsville.

“There was also less expensive equipment to buy for ice cream, and the revenue starts immediately, unlike cheese that has to age,” she added.

The Holcombs created a separate company, Brown Cow LLC, to buy milk from the dairy. It started purchasing 10 percent of the farm’s milk in 2006, when Brown Cow Ice Cream was launched, to 30 percent now, and by year’s end, they anticipate 50 percent, Suzanne said.

The bulk of sales are wholesale, about 2,000 – 3,000 pints monthly, plus a small retail store with a single part-time employee for pint-only sales. They’re currently in discussion with some food distributors, because the couple spends four days a week on the road making deliveries.

Not only are Guernsey cows a family farming tradition, but their milk contains more butterfat. “We focus on the components of ice cream,” Suzanne said.

Their newest flavors reflect the farm theme: New York Cherry and Apple Crisp, she added.

Mercer’s Dairy processes Brown Cow’s mix, but Holcomb’s goal is to open their own plant on the farm.

“We believe in education, so the facility could be open to the public to show how ice cream is made,” Suzanne explained. “Other dairy farmers could learn the process and use it for their ice cream.”

College offers ‘incubator’ plant

Morrisville State College offers fledgling ice cream makers the only incubator plant in the nation. For six months maximum, they can hone production skills after creating a marketable dairy product. “Of the 100 a year or so who call, half take the time and expense to come in and learn.

One or two farmers finally produce ice cream,” said Jim McFadden, facility director. “I tell those who want to do on farm processing you need business and management skills to succeed,” he added.

The profit margin is so small on ice cream that producers save money only by doing the labor themselves, McFadden said. “There is money to be made, but it’s a lot of work,” he added.

Interest in making ice cream fluctuates in reverse proportion to milk prices. Low milk prices prompt farmers into doing something more profitable with their milk, McFadden said.

Ice cream mix typically comprises only 40 percent of milk; the rest is a nearly equal percentage of cream and butterfat, followed by dry ingredients such as sugar, skim milk powder and flavorings. This base mix has a shelf life of about two weeks, during which it must be made into ice cream, but once frozen, it can last a year. Farmers learn to process this mix at Morrisville, and finish the ice cream for sale at farm or store.

McFadden notes the next step for new producers is to find a small plant that will co-pack for them, but the state could use more of these facilities as interest grows.