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A dairy centennial celebration

Jim Hlatky tok over the managerial position of Osakis Creamery Association in 2005.1 / 3
The Osakis Creamery Association building was constructed in 1914, with an addition added in 1951. Currently, the building serves as the co-op's main office and houses the general store.2 / 3
Agronomy has become a major sector of Osakis Creamery Association. With two sprayers, the co-op sprays 35,000 acres of crops each year.3 / 3

In spring 1909, a group of men from the Osakis area gathered to organize a business that would withstand the test of time. That business was the Osakis Creamery Association.

Over the last 100 years, the Osakis Creamery Association has strived to create a continued legacy of commitment and service to its patrons.

In the beginning

The Osakis Creamery Association was organized on March 27, 1909. Prior to that - and as far back as 1893 - local farmers brought their milk to an on-farm creamery in the area. There, the cream was separated out and the milk was returned to the patron. Butterfat at that time was priced around $0.18 per pound. A local buttermaker named Hugger operated a second creamery of sorts in the early 1900s.

As agriculture grew in the Osakis area in the early 1900s, area producers recognized the need for a local farmer-owned cooperative that would cater to their specific needs. With help from the first board of directors - president O.H. Curtis, vice president A.T. Johnson, secretary Chris Heen, treasurer L.C. Moore, and directors J.M. Johnson, H.P. Olson and E.L. Fritchie - the first Osakis Creamery Association building was constructed at a price of $1,590 on a lot donated by Ed Bowman and O.H. Curtis. The co-op opened for business on June 14, 1909. That day, the plant produced 18 tubs of butter.

Business quickly grew. Within the first year, the co-op totaled $31,009.26 in gross sales. By 1913, those sales more than tripled, totaling $104,523.10. The following year, the business had outgrown its original facilities and on September 5, 1914, shareholders of the Osakis Creamery Association unanimously voted in favor of building a new plant.

The new 40-by-80-foot building was completed on December 15, 1914 at a cost of $5,135. It took only four years to pay the debt off due to the co-op's success. In November of 1924, the co-op advanced further, purchasing a mechanical ice builder, which took away the need of buying and storing ice for year-round refrigeration.

Trials and tribulations

The Great Depression was a trying time for the Osakis Creamery Association. As many farmers fought to make ends meet, so did the co-op, mirroring their struggles. To worsen the situation, a severe drought hit the area. The combination of both caused butterfat prices to drop to $0.18 per pound, equivalent to what it was in the late 1800s.

Producers and the co-op survived, and by 1939 the Osakis Creamery Association was diversifying its operation. In March of that year, a meat processing plant and locker were opened for business in the original creamery building. It was during 1939 that the co-op also took the name of the Osakis Creamery Association.

In 1945, sales grossed a total of $583,306.25 and by 1951 a second expansion was necessary with the introduction of whole milk processing. A 24-by-80-foot addition was completed that year to house the new, larger equipment. Six years later, the expanded plant was bringing in nearly 100,000 pounds of whole milk each day. The raw milk was churned daily into butter and sent to several butter buyers in 64-pound boxes.

Changing

with the times

The 1960s and 1970s brought a lot of change within the Osakis Creamery Association.

Prior to 1960, fluid milk was sold to Todd County Dairy Co-op, a drying plant in Browerville, but in 1960 the co-op began selling it to Land O' Lakes.

Fire struck the creamery association on June 7, 1966. The fire did not take the creamery building itself but destroyed the meat processing plant. Although the board of directors questioned rebuilding, co-op patrons voted in favor of it and the plant was rebuilt later that year. Unfortunately, business at the meat plant and locker slowly faded out. The Osakis Creamery Association sold the plant in September of 1971.

Another major change the co-op encountered was the discontinuation of bulk butter production in 1968. However, the creamery continued to churn butter to sell locally until it ceased altogether in the early 1970s.

In 1973, the Osakis Creamery Association saw gross sales reach $1,211,729.24 with a milk volume of 18 million pounds. At that time, the co-op was selling bagged feed and bagged fertilizer to its patrons, but the co-op was struggling in all aspects of business.

On September 1, 1973, Jim Eveslage took over the managerial position at the Osakis Creamery Association, a position he held for 32 years.

"I always believed our co-op should serve our farmers, that they should be able to buy from us," Jim Eveslage said. "It was built for the farmers in the area to serve the milk customers and farmers in the area."

With this philosophy, Eveslage pushed the co-op to change with the needs of the area farmers. In 1974 a new warehouse for bagged feed replaced the original one, and later that year the milk processing equipment was taken out of the creamery. In 1976, the creamery association decided to diversify once more and built a fertilizer plant on some land purchased along State Highway 127. Prior to that, the nearest fertilizer plants were in Sauk Centre and Brandon.

"That was a very profitable thing," Eveslage said of the fertilizer plant. "There was a lapse where we could cover territory. There was a need for that."

The next two decades were ones of growth for the co-op. One of the biggest changes during that time came in the spring of 1996 with the building of the feed commodity shed on the same site as the fertilizer plant. This business allowed the co-op to provide producers with customized feed rations.

"Feed was a plus for us. We made good money in feed," Eveslage said. "The commodity feed shed was a real asset to the creamery."

During his years managing the Osakis Creamery Association, Eveslage said the biggest challenge was the competition for fluid milk. To overcome this, the co-op lowered its hauling costs as much as possible and kept a strong equity rotation program in place throughout the years.

Eveslage credits the success of the co-op through the tough years to a good board of directors. In the time he was there, the co-op went from being a $1 million business to being a $30 million business. In 2001, it was bringing in 120 million pounds of milk from 121 Grade A producers and 15 Grade B producers.

Continuing a legacy

Jim Hlatky took over management of the Osakis Creamery Association in 2005. While the co-op remains as strong as ever, it has seen a change in patronage over the last several years, with a decrease in dairy patrons and an increase on the crops side of the business.

"Agronomy has really taken off," Hlatky said. "Feed is doing good but it's tied to dairy."

Currently, there are 440 total patrons of the co-op, with 98 of those being dairy patrons bringing in 8 million pounds of milk per month, which is shipped to AMPI. Of the estimated $24 million in gross sales for 2009, Hlatky said approximately $9 million of that will be from feed and agronomy.

The co-op owns five milk trucks, two feed trucks and two sprayers. The co-op sprays nearly 35,000 acres of crops each year, Hlatky said. It also runs a general store.

Diversification and changing with the needs of the patrons are what has kept the Osakis Creamery Association going all these years.

"Some people are reluctant to accept change," Hlatky said. "You may not like every piece of change but the way the world is today you need to adjust and adapt, otherwise you will fall by the wayside."

To commemorate its centennial anniversary, Hlatky said a celebration with a harvest festival theme is being planned in conjunction with the creamery association's annual meeting on November 21. More details will be released at a later date.

Hlatky asked that anyone with any information, stories or photos of the co-op throughout its history contact him at (320) 859-2146.

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