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by Edge Dairy Farmer Cooperative on Sep 18, 2025 1:02:40 PM
30 years of dairy transformation within the Mount Rushmore State
In 1929, Swiss immigrants Alfred Nef and Alfred Gonzenbach opened a cheese processing plant in Milbank, South Dakota. As luck would have it, Gonzenbach was heading to Montana with the intention of starting a cheese plant there for the pair of friends but stopped at a gas station in Milbank. A local businessman quickly called the mayor and others in town to convince them the location would be ideal for their factory. Little did they know that Valley Queen Cheese would continue to be a leading processing plant in the region 96 years later, despite facing various industry setbacks and challenges along the way.
Over the last 30 years, the I-29 corridor has seen a significant surge in milk production, enabling regional growth in dairy processing plants and boosting a variety of other industries involved in the dairies, such as trucking and transportation, feed mills, suppliers and on-farm services.
Valley Queen has adapted to meet the increase in production and has undergone two major expansions over the last several years, starting in 2019 and most recently in 2025, which doubled their processing capacity from 4 million pounds of milk per day to 8 million pounds. The cheese plant currently works with 39 area farms, totaling around 95,000 cows.
“We’ve had the awesome opportunity to take advantage of the growing milk supply in South Dakota,” Doug Wilke, Valley Queen CEO, said. “The Alfreds landed here by chance, and today we now have this tremendous milk supply in the I-29 corridor, and it’s growing. We’ve been fortunate to have enough customer demand to take advantage of it.”
South Dakota’s friendly business climate with no corporate tax has made it an easy place to do business, but Valley Queen credits its growth to the alignment of three key factors: customer demand, shareholder investment and investment at the farm level.
“It takes three entities working together – customers, shareholders and farmers – to achieve growth in the dairy industry,” Wilke said. “Managed growth has been critical for us. It involves working with our customers and ensuring they have opportunities to market and grow, and we want our farmer base to be innovative, efficient and expanding too.”
South Dakota dairy’s downward trend
The thriving dairy industry in South Dakota we see today did not always exist. Cow numbers reached a low point in the 1980s and 1990s, with young farmers leaving the area to move to bigger cities and others retiring.
In the early 1990s, Bill and Raynelle Mueller from Big Stone City struggled to find a supportive lender to help them start their dairy farm.
“We went to all the bankers in the area trying to find money, and we finally found one who would go with us,” Bill said. “You’d be surprised how many bankers thought we were nuts.”
The Muellers have a small, registered Holstein herd that has been recognized as a leading herd among the Holstein Association. They have been shipping their farm’s milk to Valley Queen since they first started their farm and can remember a time when the plant implemented incentives to reward new farmers.
“We were one of the last producers that Valley Queen gave a bonus to for starting up a new operation,” Bill said. “We put that money toward building a feed room for the farm.”
From decline to recovery: Recruitment efforts lead to farmer growth in the 2000s
Processors were concerned about the need for increased milk production, which underscored a clear need for change to revitalize dairy farming in the state. Fortunately, many key leaders recognized the region’s significant potential for growth, and strategies for development emerged in the late 1990s and early 2000s.
South Dakota’s Secretary of Agriculture from 2000 to 2007, Larry Gabriel, identified dairy as the commodity with the greatest potential to revive the area’s economy and launched a campaign to recruit new farms to the state.
Roger Scheibe was hired to recruit dairy farmers from other states and countries, including the Netherlands, where they faced potential barriers in their current location and lacked opportunities for growth.
“I ran ads in newspapers throughout the United States, the Netherlands and Canada,” Scheibe said. “[Edge members] Wim and Nicolien Hammink who were one of the first farmers to immigrate from the Netherlands to South Dakota helped with translations, I also traveled overseas and met with farmers.”
Scheibe set up tours for farmers to visit the region, and for every 10 to 15 people on the tour, one or two would be interested in making the trip over, he recalls.
Over that period, more than 15 dairy owners immigrated to South Dakota.
“I recruited all these dairy farmers in and got the ball rolling, and then from there it took on a life of its own,” he said. “I thought to myself, I might have to start looking for something else. Then, I became an ag lender, and all my customers became the dairy farmers I brought in.”
To this day, Scheibe remains bonded to farmers he helped bring to the region. He also became one of the original organizers of the Central Plains Expo.
“When I recruited dairy farmers, especially those from overseas, they put their trust in me and that bond between us will always be there,” he said.
Other long-time dairy champions, including South Dakota Representative Tim Czmowski, who has spent over 44 years in the industry, have also been instrumental in developing the region's dairy community. He’s been involved in the development of numerous area processors, including Agropur and Valley Queen, and is now the founder of Cheeseworld, LLC.
“As a team lead on Agropur’s milk development group, our goal when we initially formed was to encourage growth and build dairy back to where it once had been in South Dakota, but we’ve far surpassed that,” Rep. Czmowski said.
A continued bright future for the I-29 milk corridor
Dairy in South Dakota and the nearby areas along the I-29 corridor have gained significant momentum and fostered a community built on connection and camaraderie.
Central Plains Dairy Expo, an annual event that started in a room with only 10 to 15 vendors, now attracts over 4,000 dairy-focused individuals from multiple states, representing the area's growth and community building.
Edge member Lynn Boadwine of Moody County Dairy came up with the idea for the expo over 20 years ago.
“I wanted to create an event that would bring together this industry and grow the pool of producers in our community,” Boadwine said. “And, not only that, but also show vendors and suppliers that South Dakota is an impactful dairy state.”
The red-carpet recruitment and expo to match helped bolster the growth. However, farmers also need additional infrastructure and resources to support their relocation or growth. South Dakota State University recognized this gap and stepped in with specialized milk processing training
The Davis Dairy Plant of South Dakota State University processes about 15,000 pounds of milk per week. It’s utilized for research purposes, helping area processors test new products or equipment. It also serves as an excellent training experience for college students, encouraging them to explore career opportunities in the state’s dairy job market.
With community alignment and various growth factors, the future of dairy in South Dakota looks promising.
“It goes to show that a lot of good people working together toward a common goal can really move mountains,” Rep. Czmowski said. “Our processors and farmers, government support, and all those who contribute, such as farm equipment sales, veterinarians and others, all joined in the effort to make the I-29 corridor the milk corridor.”
And it doesn’t end there.
“There’s a lot of good activity and the window of opportunity won’t stay open forever,” Wilke said. “It’s important for producers, processors and customers to take advantage and shape it because at some point it’ll close, but it feels like it’s going to stay open for a while.”
The growth potential for the dairy industry still exists in the I-29 corridor.
“I think dairy in South Dakota and the surrounding areas has a continued bright future for dairy,” Rep. Czmowski said. “Why not have this region be a major player in the supply of global dairy products?”