INDIANAPOLIS – A longtime family-owned Indiana milk producer is using an early Christmas present to manufacture a value-added product at its operation.

Kuehnert Dairy will create a cheese curd manufacturing facility on its farm outside Fort Wayne, according to the Indiana State Department of Agriculture (ISDA). The work will be financed with help from a $100,000 grant awarded by the Dairy Business Innovation Alliance (DBIA).

DBIA, in partnership with the Wisconsin Cheese Makers Association and the Center for Dairy Research, has awarded 41 grants totaling close to $4 million to farmstead operations and dairy processing businesses across the Midwest.

The partnership also develops and administers programs that provide technical assistance to dairy farms and related businesses in Indiana, Illinois, Michigan, Ohio, Wisconsin and six other states in their service area.

Center for Dairy Research Director John Lucey said the grants are a popular way to assist smaller dairy related operations grow and diversity their product offerings to survive financially in an increasingly competitive industry.

“Our goal is to increase the number of thriving farmsteads and innovate dairy manufacturers in the region,” he said.

Kuehnert Dairy, which has been family owned and operated for more than 125 years in Allen County, milks over 300 cows. The farm also has an agritourism related operation and will open a retail store on the property early this year.

Specifically, the funding will be used to purchase cheese-making equipment, product packaging along with marketing and promotion services.

Owner Andrew Kuehnert said he’s grateful to receive the grant out of hundreds of applications each year. Kuehnert said he decided to use some of the milk on his farm to make cheese curds after noticing demand for such a product in Indiana was not being met.

“This funding will allow us to produce farm fresh cheese curds, milking cows in the morning and having a value-added product by the afternoon,” he said.

The plan is to offer some of the cheese curds directly to consumers at their on-site retail store and online. The remainder of the product will be sold to local grocers in the Fort Wayne area.

According to the ISDA, the money is from an existing DBIA grant program aimed at helping small to medium size farmers or processors become more competitive. Projects designed to diversify on-farm activity, creating value-added products, enhancing dairy by-products or export programs are eligible for the grants.

Nearly 70 percent of the recipients under the latest grant funding allocations are first-time winners, ISDA officials said.

The DBIA, whose mission is helping to keep family type dairy farmers and processors from going out of business in an increasingly competitive industry, was established under the 2018 U.S. Farm Bill. DBIA is funded through the USDA.

Since its inception, Lucey said over $13 million in grants have been awarded to over 170 recipients.

He said the grants do not pay for the cost of construction. The funds are strictly for purchasing equipment and marketing of a product or whatever else an applicant under the use restrictions of the program is specifically trying to accomplish with the grant.

He said applications are scored by USDA representatives and others involved in the selection process from each state.

Lucey said scoring is based on a business plan required to be submitted by each applicant and other factors such as whether the idea to strengthen an operation is viewed as one that’s realistic and can succeed.

Kuehnert Dairy Farm is no stranger to offering more than just milk to survive. In 2013, the farm began an annual fall festival. Milk from their cows will be among the products available at its soon-to-be-opening farm store.

“We’re hoping that we’ll have a lot more of these farmsteads or small dairy businesses remain viable here in our Midwest. That’s really the long-term kind of goal,” Lucey said.