Vermont cheesemakers look to stores and online for survival

Despite a wave of sympathetic donations and mail-order purchases from loyal customers, Vermont’s small cheesemakers expect to weather a difficult several months ahead.

A member survey by the Vermont Cheese Council found that 58% of the group’s 50 members are still seeing sales losses of 25% or more, according to Marty Mundy, the group’s executive director. Mundy added that 10% are concerned they’ll go out of business because of losses from the Covid-19 pandemic and the restaurant and store closures that followed.

All are watching closely to see how much Vermont opens up this summer and fall to tourism, a critical element of the state’s specialty cheese sales. Some cheesemakers make 90% of their sales at stores and farmers markets in these seasons, Mundy said.

Whatever happens with the state’s social distancing guidelines and quarantine for out-of-staters, it’s unlikely that there will be an opportunity for cheese shoppers to linger at a farmer’s market or specialty store to taste different cheeses and talk to the cheesemakers about their work — an activity that for many is a critical part of selecting premium cheese.

“Buying cheese is just not going to be the same experience,” Mundy said.

A complex industry

The Covid-19 crisis has had a complex impact on the cheese industry. Panic buying drove up the sale of durable supermarket cheese like cheddar. In the week of May 24, national cheese sales were 18% higher than in the same week in 2019. Up to that point, Americans had spent $1.5 billion more on cheese in 2020 than in 2019, an increase of 17%, said John Umhoefer, the executive director of the Wisconsin Cheese Makers Association, who wrote a column about cheese prices for the publication Cheese Market News.

That was good news for cheesemakers like Cabot Cooperative Creamery, which has been hiring during the crisis in order to meet increased demand. But the makers of fresh, soft-ripened and blue cheeses, which don’t last as long as varieties like cheddar, were hit hard by the closure of restaurants and the boutique-style stores or kiosks in supermarkets where customers could learn about the cheeses and try them.  

Vermont cheesemakers reported sales drops of 30% to 70% this spring. Dairy farmers dumped milk because they had an oversupply.

“On March 15, all of a sudden we are seeing trucks in New York City being returned with product back to Vermont,” said Adeline Druart, the president of Vermont Creamery, the Barre cheese company that produces more than 5 million pounds of cheese per year and makes a third of its revenues from the restaurant industry. “They were returning fresh cheese, butter, fresh goat cheese, crème fraiche, those products that are used in the kitchen to cook. Not only did we have zero orders, but also product that was coming back.”

Vermont Creamery is owned by the Land O’Lakes dairy cooperative in Minnesota, and is thus insulated from some of the financial impact of the Covid-19-related closures, noted Druart. And it’s aided by robust distribution in supermarkets, where most bricks-and-mortar food shopping happens nowadays.

Vermont Creamery’s retail sales were 10% higher in May than in May 2019, and Druart expects to see the same in June. The company uses 15 million pounds of goats milk per year, and 5.5 million pounds of cows milk from the St. Albans Coop.

Sales of Vermont Creamery’s soft, ripened cheeses are down 50% from last year. But its butter sales have taken off — as they have for most producers nationally — and goat cheese sales have increased significantly too. Sales of crème fraiche are up 30%.

“As people cook at home more and more, they still want quality product, and treat themselves with restaurant-like flavors and recipes,” Druart said, adding that for two months, the company added $2 an hour to the pay of employees who stayed to make cheese.  

Creative marketing comes into play

Dozens of small cheesemakers have pivoted sharply to stay in business.

“It was a nosedive when the restaurants closed,” said Hannah Sessions, who with her husband owns Blue Ledge Farm in Leicester, which milks 150 goats to make several fresh and aged cheeses. “People started spending all their money on toilet paper or something.”

Sales dropped by about half for Blue Ledge in March. Blue Ledge set up a tiny farm stand with a mini-fridge outside, and received help from the Center for an Agricultural Economy to find new accounts with online farmers markets and other direct-to-consumer models. It also updated its website to bolster online sales, and her high school-age daughter took over the job of online order fulfillment. Victory Cheese boxes, cheese collections started by other Vermont cheesemakers to promote artisan cheese (emblazoned with “choose it or lose it!”) from around the state, helped too.

“People who were in quarantine all over the country were looking for cheese,” said Sessions, and when news came out that cheesemakers were struggling, she said, online orders picked up considerably.

“Fortunately, we already had an online store established,” said Sessions. “Overnight we went from about two orders a week to about 40.”

Other companies are scaling back. Grafton Village Cheese Co., which is owned by the Windham Foundation, was already working overtime to keep its position against the growing specialty cheese competition nationally. On June 10, Windham Foundation President Robert Donald told employees that the company might consolidate its two production facilities, one in Grafton and one in Brattleboro.

Grafton saw about half of its sales volume disappear in April, compared to April 2019, because food service accounts weren’t buying cheese.

“We’re missing easily 40% of our business, even now,” said Grafton President Ruth Flores in mid-June.

A very Vermont product

Although it shares the specialty food realm with syrup, cider, and an array of other products, cheese has received the most attention since the Covid-19 crisis began, said Mary Tuthill, who runs Mad River Taste Place, a store in Waitsfield that specializes in Vermont specialty foods.

“Of all the things we’ve sold, it’s been cheese more than anything else,” Tuthill said, adding that in normal times, beer is the most popular item. The store was fortunate to have created an online shopping portal last fall.

Like Sessions, Tuthill thinks publicity about the Victory Cheese boxes sparked a lot of cheese sales. Mad River Taste Place also created its own “cheesemonger’s choice” boxes that sold for about $45, and Tuthill credited an overall surge in sales to advertising by Jasper Hill Farm, a cheesemaker in Greensboro Bend.

“I think people saw the media that the Vermont dairy industry was struggling and they wanted to do their part in helping to keep it moving,” Tuthill said. “We were shipping cheese to Texas, California, North Carolina, a bunch to Florida. It was definitely people who were adamant about wanting to get Vermont-specific cheese. California has amazing cheese, and here we are sending boxes of cheese to California.”

Mundy’s now watching closely as lawmakers decide how to allocate Vermont’s share of the federal CARES Act money to agricultural businesses. Gov. Phil Scott has proposed $50 million for dairy, including $10 million for food processors, such as the makers of cheese, yogurt, butter and other products. Lawmakers have earmarked less than that for dairy.

“There has been a lot of back and forth; I am not sure what it is going to look like in the end,” Mundy said June 16. She hopes farmstead cheese producers, such as those who have animals to feed, get help soon enough to prevent them from selling their herds.

“Our priority is really to get folks through this experience in a way where they can survive,” she said.

Flores, of Grafton Village Cheese Co., is confident that retail will continue to prosper whatever happens next with Covid-19.

“People will gather,” she said. “They either do it in a restaurant or they do it in their backyard, but people have to eat. Now that everybody is into that mode, and not going out to dinner a lot, I think everybody seems to be initiated into the beauty of home delivery. We just make sure our retail distributors and customers are aware of what we are doing, and that we are operational.”