Comment: Is it possible to sell dairy milk to vegans? The short answer is – it depends on what "type" of vegan they are. Nikki Verbeet reflects on the opportunities available to farmers when farming to a customer-focused strategy.
Do you remember hearing the story of legs of lamb being sent to consumers in Asia, where they only had tiny microwave ovens? The take-home message was that our customers are not as homogeneous as our blue-top milk.
Less than 15 years ago "the customer" wasn't farmers' chief consideration. It was up to the likes of Fonterra and Tatua to invest in research and development and create new products for different customers. Farmers could confidently leave it to the companies to "add value" to what they had produced.
Now the demands (and opportunities) of the various customer segments have come to the farm gate.
There are opportunities and freedom to farm to a customer-focused strategy and deliver different products to different customers based on how unique those customers are.
Since the Covid-19 lockdown began, we have seen many producers opting to sell direct to consumers, swiftly creating and upgrading their e-commerce platforms.
The fact that New Zealand's dairy industry was built largely on the co-operative spirit meant that knowledge was (and still is) freely shared – as opposed to a purely commercial model in which information is jealously guarded.
However, it could also be argued that it encouraged a homogeneous approach (excuse the milk pun again) in which most farming was done the same way, irrespective of the uniqueness of your farm, your family, your team, your values and your end customer.
Now before my inbox is creaking at the seams with emails that say things like, "Bugger you, my cows are happy cows!" and "Do you realise just how impractical these suggestions are?" - I'll just file a wee disclaimer right here:
Some farmers may wish to supply product for a niche customer segment and some farmers may not, in the same way that not every farmer chooses to farm organically (and let's face it, those thistles on organic farms don't grub themselves!).
When is a vegan not a vegan?
So here goes – is it possible to sell dairy milk to vegans? The short answer is – it depends on what "type" of vegan they are.
According to Claire Insley, media spokesperson for the Vegan Society of Aotearoa New Zealand, a strict vegan will not consume any animal products whatsoever.
"The people who are vegan for reason of animal ethics will, on the whole, simply not support any form of animal husbandry," she said.
"As with any group of people you may find exceptions to this rule. But yes, if they consume animal products then they are vegetarian, not vegan."
However, the Vegan Society does not require people to declare they are vegans according to their strict definition when they join. They also don't currently survey their members on the reasons they have become vegan.
What it comes down to is how individuals define their own eating habits and how rigid they are at self-enforcing them.
Ethical choices, and food choices, are very personal. What people identify as, and what they actually eat, can be two different things. Much like "I have every intention of going to the gym" but the reality can be quite different.
Many people enjoy eating vegan meals but, far from identifying as strict vegans, also love eating meat.
What is ethical milk?
It's worth noting that there isn't a universally agreed definition of what "ethical milk" is.
It's a moving feast, so to speak, which consumers define according to their own individual preferences influenced by taste, social and cultural factors, status, economic cost, accessibility, marketing, stress/mood, health, education etc.
According to Glen Herud, Founder of Happy Cow Milk Co, New Zealand doesn't really do "direct to consumer" and it's hard for farmers to engage, because there's no mechanism in place for them to get direct feedback from the customer.
This is something his company is seeking to help farmers with.
"Farmers are going to get all that customer feedback from social so they can change their practice based on that. So, when I communicate, I'm communicating to those people who buy my milk, and the thing that gets them excited is often the very thing that makes dairy farmers upset."
"So yes, it's about finding out who you want to sell to and just giving them what they want."
Is ethical milk worth pursuing for farmers?
Sales of products with sustainable attributes now make up 22 per cent of total store sales and the sustainable product market could hit $150 billion in US by 2021, according to a 2019 Neilsen report.
"Consumer choice has never been greater. Supermarkets sell around 40,000 more products than they did 20 years ago" Jeremy Hill, Chief Science & Technology Officer for Fonterra said.
"We know this [ethical products category] is fast growing across a range of segments from millennials to seniors. It's also a trend that's not just limited to affluent markets – it's fast occurring in emerging markets, where sustainability and ethics relate to quality of product and supports trust."
Hill considered that there was a real win-win opportunity.
"We're among the most sustainable, and we're competitive because our cows are fed on grass grown in open pastures, whereas other countries might be barn based. With climate change, our farmers will need to continue to innovate as they've been doing for decades."
He pointed to the example of Owl Farm, near Hamilton, which over the last two years had reduced greenhouse gas emissions by eight per cent, and lifted operating profit by 14 per cent. He contended that they've shown it was possible to reduce emissions and keep their business profitable.
According to a report by CGS, more than one-third of consumers are happy to pay 25 per cent extra for more sustainable products.
However, from a practical point of view if you want to supply "ethical" milk to a segment of consumers, who don't like the way calves are separated from cows for example, it can require a system change.
Herud said he started not separating cows and calves for practical reasons: he simply didn't have the calf sheds/feeders and didn't want the cost of outlaying for them, plus he was saving on the labour cost.
"First off, you don't have to separate calves from their mothers – so there's one job you don't have to do," he said.
"With the current system, you separate a cow – you go and milk it, put the milk in the vat, and then take the calf feeder, fill it up with that milk from the vat and then feed the calf. You can't run a seasonal supply where you've got 80 per cent of your herd calving within four weeks. It just doesn't work."
"You spread the calving out so you have four to five calves per month. You've only ever got a handful of calves running around at any given time, so you just leave them. You tag the calf when it's born and when it's getting too big you take it away.
"So yes, it is probably drinking a lot of milk and there probably is a production loss, but there's a saving when you're not paying labour to separate cows, to feed calves, and the infrastructure to house calves."
Who decides what "ethical milk" is?
Farmers can't be the ones to define what ethical is – it comes down to what individual consumers think is ethical. However, it is up to individual farmers to decide whether they want to farm for these consumer segments.
Some consumers think it's great that calves stay with their mothers but others think that that's not ethical because the calves still go to get slaughtered at two years of age; and yet others think you can't utilise an animal for anything at all.
One thing is clear: you can't please everyone.
Other options include dairy farmers using sexed semen so a cow only produces a heifer calf or using emerging science to "edit" a cow's genes, so it produces only female offspring.
There's also an example of a farm in the US farming according to Ayurvedic principles.
They artificially inseminate so that they kill no stock on farm. Basically, if it's born there it has to live there until it dies.
You can even take it a step further and give cows hormone treatment to start lactating without even having a calf.
Herud said he wrote an article last year about giving cows' hormone treatment to start lactating and many farmers thought the idea was horrendous.
However, he reckoned there were many people in town who said, "I don't mind you giving a cow an injection if there's no little baby calf that's going to die."
However, the New Zealand Veterinary Association does not support hormone use.
Hormones were considered a risk to animal welfare and ran contrary to conditions of trade imposed by several of New Zealand's major trading partners.
So, some animal welfare concerns can conflict with other animal welfare concerns.
Falling in love with your local farmer
Herud openly admitted he had a rocky ride to getting Happy Cow Milk Co. up and running,
"I've done everything I can to actually fail at this business and it just seems to refuse to die. The level of commitment from people out there just proves how much they want this, like I get fan mail like you wouldn't believe. It's just people who say 'I just found out about you and this is just the most wonderful thing. I thought I could never drink milk again'".
"We want our milk to be reasonably priced, so that's why it's taken so long to launch. We're getting everything in place to make it so we can produce it just as efficiently and distribute it and sell it at the same price [as normal milk]."
"We wanted to go to market and say 'if you want to buy milk in a reusable package, that's produced ethically (whatever that is) and actually it comes from your local farmer, here's Bruce and Karen' – why would you not buy from them?"
Herud said that farmers are generally really proud of their operations and they wanted to show people.
"The people we've got lined up are just hanging out to show what they do. People are going to fall in love with their local farmer and hopefully their farmer is going to make a few changes."
• Nikki Verbeet is Commercial Manager for NZME and a former dairy farmer.