Ag Innovator of the Year: Determined to Innovate

by Dan Lemke

Innovations rarely succeed in their first iteration. In most cases, success takes time, effort and more than a few failed attempts. For AURI’s 2020 Ag Innovator of the Year, 29 was the magic number.

Milk Specialties Global is an Eden Prairie-based dairy processing company that develops high-quality nutritional ingredients for livestock producers, as well as milk and whey protein ingredients for human nutrition and functional foods. The company is one of the largest whey protein processors in North America.

Milk Specialties Global enlisted AURI’s help in developing coated pellets to deliver bypass amino  acids to dairy cows.

“Bypass means the supplement is protected through the four chambers of the cow’s stomach so that it can get to the small intestine where it can be broken down and utilized by the animal,” says AURI Senior Scientist for Coproducts Alan Doering.

Doering says lysine and methionine are two of the most limiting amino acids in most dairy diets. Raising lysine and methionine levels increases dairy cow performance and milk production. Because cows cannot synthesize lysine or methionine on their own, those nutrients have to be delivered through diet.

“Lysine and methionine are needed to properly balance dairy diets, especially for those animals that are fed a corn-based diet,” says Chuck Soderholm, Milk Specialties Global Director of Research and Nutrition. “Lysine helps with milk yield and milk components; methionine improves milk components such as protein and fat.”

From Idea to Market

Developing the coated products took time and a few setbacks. Milk Specialties Global worked with AURI because the coproduct utilization lab in Waseca has the tools necessary to do small test formulations and evaluations. Doering and AURI Associate Coproduct Scientist Abel Tekeste assisted with initial product development research and narrowed down many of the production parameters needed to make pellets that could be coated and fed to cattle.

“We had our hurdles,” Doering says, and Soderholm agrees.

“It was rough sledding. It took 29 tries to get the right formulation for lysine,” Soderholm says. “There’s no way we could have done that on our own.”

After multiple attempts, the researchers were able to develop a pellet with the right density and durability. Milk Specialties Global had the recipe to deliver coated lysine and coated methionine.

“We have a tremendous pan coating,” says Milk Specialties Global CEO Dave Lenzmeier. “But it can be a challenge to get nutrients through the rumen so cattle can fully utilize them.”

“With coated products, you have to have a solid inner core. It’s like an M&M,” Soderholm contends. “The coating is good, but you also have to have a good piece of chocolate in the middle.”

Once the pellet formulation was identified, Milk Specialties Global did further research on the encapsulation to improve and evaluate bypass efficiency at their own facilities. In 2018, the company introduced two new products to the marketplace.

EB-MET™ by Energy Booster® is a rumen-protected methionine supplement. Methionine plays a key role in many biological functions during transition, breeding and lactation. Milk Specialties Global also produces and markets EB-LYS™ by Energy Booster®, a rumen-protected lysine supplement.

Lenzmeier says the coated ingredients provide a dual benefit by delivering both bypass amino acids and energy from the rumen inert fatty acid coating.

“The most limiting ingredient for a dairy cow is actually energy,” Lenzmeier says. “More energy,
more milk.”

Soderholm estimates 25 percent of U.S. dairy cattle are getting methionine supplements and about 15 percent get lysine. The potential market for Milk Specialties Global’s products is huge.

Collaboration

Working with AURI helped Milk Specialties Global develop their concept and turn it into a product that is now widely available to livestock producers.

“The great thing about AURI is they were a catalyst to provide technical support and equipment to take an idea beyond pilot stage. Now we’re shipping truckloads,” Lenzmeier explains. “This is a great example of collaboration that has a meaningful impact on us and on other companies. We’re now selling millions of pounds of product and we’re just getting started.”

Doering says other companies are working in the bypass amino acid arena, but Milk Specialties Global has an advantage because they use byproducts such as milk fat from their own dairy processing.

“Milk Specialties Global generates a lot of the required ingredients for improved performance from within their own process,” Doering says.

“We offer a good value proposition for customers,” Soderholm says. “They can get protected amino acids at a slightly lower cost and get the energy for free.”

Innovation Recognized

The innovative use of a dairy processing coproduct leading to commercial success is why Milk Specialties Global was selected by AURI as their Ag Innovator of the Year. Since 2002, AURI has presented the award to highlight and celebrate an AURI client that exhibits innovation and has achieved success in the marketplace.

“AURI sees some amazing innovations across the state each year and it often happens under the radar of media and industry,” says AURI Executive Director Shannon Schlecht. “The Ag Innovator
of the Year award provides a platform to recognize innovative applications that may go unnoticed by others and hopefully inspires others to continue their commercialization journey of industry-changing technologies.”

Doering says that transforming an idea into a marketable product can be an arduous process. However, seeing a client achieve success because of AURI assistance while adding value to a Minnesota ag product is gratifying because it fulfills AURI’s mission.

“This was a very enjoyable project. It was fun to see how it moved from idea to reality, from the concept stage all the way to being available to the dairy producer,” Doering says. “Milk Specialties Global is an excellent recipient for the Ag Innovator of the Year. They’re very innovative in identifying new opportunities. Their processing generates coproducts, and they’re an innovative group that looks for ways to utilize these products for feedstuffs or as a higher value product.”

“As an organization, it is fun to celebrate a successful collaborative effort,” Soderholm says. “There were a lot of smart heads involved with this project. It means a lot to have an award from AURI because they are well thought of, and we owe AURI a lot.”

While the coated lysine and methionine pellets have reached the market, AURI continues to work with Milk Specialties Global on other projects intended to move agricultural products into new places. The level of success clients like Milk Specialties Global achieves reflects well on AURI’s abilities to collaborate with innovators.

“I think it shows that AURI has certain skill sets that can help businesses of multiple sizes, from early stage entrepreneurs that may be pre-revenue to working with existing businesses around new innovation areas they want to explore and add to their product portfolio,” Schlecht adds. “AURI is proud to work with companies like Milk Specialties Global that are constantly pushing agricultural innovation forward to see what is possible through science and technology.”

Learn more about the Ag Innovator of the Year and read about past winners by visiting: https://www.auri.org/news/ag-innovator-of-the-year/.

Powered By Dairy

Milk Specialties Global is one of the nation’s leading dairy processors and one of the industry’s most innovative companies, serving both animal nutrition and human nutrition markets. Milk Specialties Global began operating in the 1940s, producing one primary product.

“The company focused for several decades on producing animal milk replacer, an Energy Booster® supplement for lactating dairy cows. That was really the flywheel of the business,” says Milk Specialties Global CEO Dave Lenzmeier. “It put us on strong financial footing.”

Lenzmeier says the company bought additional whey processing plants in 2008. Milk Specialties Global went from three processing plants to 10 facilities scattered across North America, including plants in California, Wisconsin, Illinois and Mountain Lake, Minnesota. The company also expanded their product offering and business scope.

Today Milk Specialties Global is comprised of three business units, with corporate headquarters in Eden Prairie, Minnesota.

Milk Specialties Global Animal Nutrition offers a range of specialty dairy ingredients used in the formulation and processing of animal feeds, as well as a comprehensive line of milk replacers, ration supplements and rumen-inert fats.

Lenzmeier says Milk Specialties Global enjoys a mutually beneficial relationship with the nation’s dairy farmers. The company purchases about 16 billion pounds of milk equivalent or about 9 percent of the nation’s milk supply each year. Coproducts from their dairy processing are used as nutritional ingredients designed to help those same dairy farmers become more efficient and productive.

“We are a substantial buyer of milk, so our relationship with dairy producers is different. We buy from them and look out for their best interest,” Lenzmeier explains. “We want to bring the best technology to them for their success. We have a symbiotic relationship.”

Milk Specialties Global worked with AURI to develop coated bypass protein ingredients to deliver needed amino acids lysine and methionine to dairy animals. Lysine and methionine can only be delivered to animals through diet and they are important nutritional ingredients for increased milk production.

“Dairy farmers are being paid for the dry components in the milk, protein, fat and lactose,” says Milk Specialties Global Director of Research and Nutrition Chuck Soderholm. “Anything we can do to help protein and fat go up helps with their profits.”

“We are both a customer of the dairy industry and a manufacturer of products for dairy producers,” Lenzmeier adds. “We look at our partnership with the industry as very important. We want them to
be successful.”

In addition to offering their own branded products, Milk Specialties Global provides ingredients to feed and animal nutrition manufacturers nationwide. Products are available for dairy cows and calves, pigs, horses, goats and even companion animals like dogs and cats.

Milk Specialties International Group exports basic and high-performance nutritional ingredients to a number of international markets, including Asia where there is growing demand for dairy proteins and carbohydrates. The group operates out of the Milk Specialties corporate headquarters in Eden Prairie, Minnesota.

In recent years, Milk Specialties Global has turned more attention to human nutrition. Milk Specialties Global Human Nutrition is a customized protein ingredient provider that serves the rapidly growing sports nutrition and weight loss segments of the food and beverage industry. The group offers a broad portfolio of value-added whey proteins, milk proteins, hydrolysates and specialty proteins.

“We started a little flat-footed on human nutrition,” Lenzmeier acknowledges, “now we make over 100 types of whey protein and we can adapt to whatever our customers want. It may be more difficult to produce, but we make a conscious effort to meet the needs of our customers.”

Although they have not branded products for the human nutrition market, Soderholm estimates about 60 percent of their production is for human consumption, including snack bars and
protein drinks.

“Dairy products are readily digestible, high-quality protein sources,” Soderholm says.

Having a presence in both the animal and human nutrition world means Milk Specialties Global can efficiently process all of ingredients they acquire. Lenzmeier says the company leverages 100 percent of in-bound materials into marketable ingredients.

Innovation Driven

Entering into new and ever-expanding markets is indicative of Milk Specialties Global’s commitment to innovation.

“Innovation has been the backbone of our evolution,” Lenzmeier says. “Since we started, we’ve developed alternative formulations to match what our customers need.”

“We’re always innovating,” Soderholm agrees. “What can we do that’s new, what can we do better?”

AURI recognized Milk Specialties Global’s commitment to innovation by naming them 2020 Ag Innovator of the Year.

“Their efforts to advance animal nutrition and human nutrition has been unwavering and there is a clear passion to always explore new ways to do things better,” says Shannon Schlecht, AURI Executive Director. “They not only continue to innovate, but they are also clearly meeting industry expectations and needs with their growing business.”

To learn more about Milk Specialties Global, visit www.milkspecialties.com.

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