Milk

Overview

The dairy sector on Hawaiʻi Island has experienced a dramatic contraction, moving from a once-thriving industry to near-extinction and now to the cusp of potential revival. Historically, the Hawaiʻi Island was a major milk producer in the state, but today only one commercial dairy farm remains in all of Hawaiʻi – and it is located on Hawaiʻi Island’s north end. The vast majority (over 90%) of Hawaiʻi’s milk is imported (as refrigerated or shelf-stable UHT milk), making the state highly vulnerable to supply disruptions. On Hawaiʻi Island, local milk production currently comes from Cloverleaf Dairy in the Kohala district, a grass-based dairy with a few hundred cows, and a handful of very small goat dairies and homestead cow owners. The sector’s decline was due to high costs, environmental compliance issues, and competition from mainland milk, but there is renewed interest from both public and private players to rebuild Hawaiʻi’s dairy capacity for food security reasons.

Production and Operations

Cloverleaf Dairy, near Hawi, is at the center of Hawaiʻi Island’s dairy production. This farm keeps roughly 300–350 milking cows (Holsteins and Holstein-Jersey crosses) that graze on pasture year-round. Unlike typical mainland dairies that are confinement and grain-fed, Cloverleaf’s model is more akin to New Zealand-style dairying – cows rotationally graze and supplemental feed (usually imported hay or grain pellets) is minimal. Milk from Cloverleaf is sold under the Meadow Gold brand (a local processor brand) and distributed on the Hawaiʻi Island and parts of Oahu. As a grass-fed dairy, their productivity per cow is lower than a grain-fed operation, so balancing herd size with forage growth is crucial. The landscape of Kohala provides ample rainfall for grass, but also poses challenges in terms of mud and runoff in the wet season.

Up until 2019, Hawaiʻi Island had a second, much larger dairy: Hawaiʻi Island Dairy in Ōʻōkala (Hāmākua Coast). That operation, with around 1,500 cows, was a more intensive confinement dairy that imported most of its feed. It supplied a significant portion of fresh milk to the state but was plagued by waste management issues. After repeated spills of manure into nearby gulches and community protests, Hawaiʻi Island Dairy ceased milking in early 2019 as part of a legal settlement. Its closure left Cloverleaf as the last standing cow dairy in Hawaiʻi. (Notably, Oahu’s last dairies had closed by 2010, and a Maui dairy closed earlier; a planned new dairy on Kauai was aborted in 2019 due to legal challenges). Cloverleaf Dairy, a family operation since 1985, struggled as well – it even went through ownership changes, being acquired by a new owner (Bahman Sadeghi) in 2022 who also owns the Meadow Gold processing plant. Under Sadeghi, Cloverleaf has aimed to modernize and expand slightly, but it quickly came under scrutiny for alleged environmental violations similar to its predecessor. In 2024, an environmental NGO accused Cloverleaf of polluting nearshore waters with runoff, threatening legal action. The dairy owner refuted many of the claims and the situation is ongoing.

Apart from Cloverleaf, Hawaiʻi Island has a few micro-dairies and goat farms. For example, there are homesteaders who keep a family cow or two and sell raw milk clandestinely (raw milk sales are illegal in Hawaiʻi without pasteurization, so this is not an official market). Additionally, some goat dairies produce goat milk cheeses and soaps, contributing a boutique dairy presence. However, in terms of cow’s milk, Cloverleaf Dairy is effectively the sole producer now.

Milk Production Data

Hawaiʻi’s milk production has plummeted to the point that the state ranked 49th in the nation for milk output in 2022, ahead of only Alaska. The state imports over 90% of its milk. For context, Hawaiʻi’s peak dairy days (in the 1980s) saw dozens of dairies across the islands, but by 2019 there were just two, and then one. Current production from Cloverleaf is not publicly reported in detail (to protect proprietary info given the one-producer situation), but it’s estimated to be only a few million gallons per year. This is far below Hawaiʻi Island’s consumption needs. Consequently, supermarkets are stocked with mainland milk jugs, and local milk often occupies only a small section. Price-wise, milk in Hawaiʻi is expensive: as of early 2025, a half-gallon of mainland 2% milk in Hilo might range $5–$6, while locally produced milk (if found) can be similar or slightly higher due to brand positioning as local. Civil Beat reported that on Kauai a half-gallon was $5.29–$8.99 in 2024, and in Honolulu $4.99–$7.29. These high prices make it attractive to try local production if costs can be controlled, because there’s a big gap to exploit if one can produce milk at lower cost.

Value-Added Production

With such a limited dairy presence, there haven’t been many cow milk-derived products from the Hawaiʻi Island beyond liquid milk. However, one venture of note is Hawaiʻi Island’s emerging local cheese and butter producers. Cloverleaf Dairy has historically just sold raw milk to Meadow Gold for pasteurization and bottling. But some small entrepreneurs have begun buying excess milk or working with goat milk to create Hawaiʻi-branded dairy products. For example, a small creamery in Hawi makes lilikoʻi (passionfruit) flavored butter and cheese spreads, albeit at a tiny scale. There’s also interest in developing “Hawaiʻian Brie” or other artisan cheeses if a steady milk supply can be secured. Additionally, Hawaiʻi Island has the state’s only remaining large animal dairy expertise, so it could become a training ground if dairying expands; this knowledge itself is an asset.

Market Trends and Competitiveness

Near-Demise and Plans for Revival

The collapse of Hawaiʻi Island Dairy in 2019 marked a low point – Hawaiʻi’s dairy industry was on the brink, with just one farm left. Public and private stakeholders have since been strategizing a comeback, eyeing the food security implications of Hawaiʻi importing virtually all its dairy. As Civil Beat noted in 2025, the vision of establishing a new dairy on Kauai could “reverse the near-demise of milk production in the state”. Indeed, a project led by Aloun Farms (a major Oahu-based agribusiness) is proposing a grass-fed dairy in West Kauai. If realized, it would be the first new dairy in Hawaiʻi in decades. The Kauai plan aims for ~600 milking cows using a New Zealand-style pasture system, targeting milk at $3–$4 per half-gallon to compete with mainland prices. To fund this, they are lobbying for state-backed bonds, arguing it’s in the “public interest” to revive local milk production. This effort underscores that competitiveness might require public investment; purely market-driven dairying hasn’t survived well in Hawaiʻi recently.

For Hawaiʻi Island, the Kauai project is both a model and a friendly competition. One could foresee a similar venture on the Hawaiʻi Island, which historically has the most suitable land for dairying (ample pasture in Waimea, Hamakua, etc.). In fact, the Hawaiʻi Island Dairy site in Ōʻōkala remains a potential asset – after closure, its assets (land, barns) were up for sale. A new operator could, in theory, rehabilitate that dairy under better management practices. Meanwhile, Cloverleaf Dairy’s situation is precarious but pivotal. Its new owner has the challenge of cleaning up past issues and perhaps expanding. Sadeghi’s strategy appears to be aligned with an infusion of capital (he’s invested in modernizing equipment and addressing effluent ponds), essentially trying to keep the last dairy afloat until others can join it. It’s a lone flag-bearer now, but if it can prove grass-fed dairying can at least break even, it sets precedent for more farms.

Competitive Factors

Dairying in Hawaiʻi suffers the familiar foe of feed cost. While grass-fed sounds ideal, even grass-fed cows often need some supplemental grain for protein and energy, and nearly all feed is imported. Additionally, scale is a problem: modern dairies succeed on economy of scale, but Hawaiʻi’s entire herd is now a few hundred cows. As noted, the entire state’s herd would only fill a single medium mainland dairy barn. This means extremely high per-unit overhead for things like processing plants. Meadow Gold (the main processor) has had financial troubles; it closed its Honolulu plant in 2020 and was sold to new owners. Keeping the processing infrastructure alive with so little local milk is tough. One strategy to improve competitiveness is to diversify dairy products beyond fluid milk – e.g., make cheeses or powders that have a longer shelf life and possibly a broader market (including export of specialty Hawaiʻian cheeses to mainland or Japan as a gourmet item). However, these require technical skill and marketing.

Land and Environment

One advantage Hawaiʻi Island has is land availability relative to other islands. There are still pastures that could support more cows if economics allowed. Additionally, the climate allows year-round grazing (no need for winter housing or stored silage to the extent mainland dairies require). This lowers some costs. But offsetting that is the high cost of compliance: Hawaiʻi’s environmental regulations essentially demand that dairies have zero runoff. New Zealand-style dairies have learned to mitigate this with things like capture ponds and careful rotation to avoid bare soil, but as we saw, any lapses can lead to legal issues (as with Hawaiʻi Island and now Cloverleaf). Future dairies likely need cutting-edge manure management – possibly even capturing methane for energy (dairy biogas) – to both meet regulations and generate side revenue (like selling energy or carbon credits).

Public Sentiment and Support

The public’s view on dairies is mixed, shaped by recent events. Communities near the old Hawaiʻi Island Dairy were relieved at its closure due to the odor and pollution concerns, fostering some negative sentiment about “industrial dairies.” Similarly, a proposed dairy on Kauai’s south side (Hawaiʻi Dairy Farms, backed by Ulupono Initiative) faced fierce opposition from nearby resort communities and was shelved after lawsuits about groundwater pollution. This suggests that any dairy expansion must involve community engagement and perhaps new models (e.g., smaller dairies dispersed rather than one big one, or locating in isolated areas). On the flip side, COVID-19 shortages and the spectacle of empty shelves did awaken public interest in local food production, including milk. So, there is also a constituency now that supports rebuilding dairies, provided they are sustainable. The political will seems to be there: lawmakers in 2023–24 have spoken of “rescue plans” for the last dairy and facilitating new ones. Concrete actions include considering subsidies for feed, low-interest loans for dairy construction, and possibly reinstating a milk price support program that Hawaiʻi had in the past to guarantee a market for local milk.

Outlook

The next few years are critical. The Hawaiʻi Dairy Industry could either fully disappear (if Cloverleaf fails and new projects stall) or finally turn a corner. If the Kauai dairy breaks ground and Cloverleaf stabilizes, Hawaiʻi Island might see interest from investors to start a second Hawaiʻi Island dairy. Civil Beat’s reporting quotes an advocate envisioning “a half-dozen dairies across the islands… two or three on the Hawaiʻi Island” in the future. Oʻahu is considered unlikely to host dairies again (land and water too scarce), so the brunt would fall on Hawaiʻi Island, Kauai, and maybe Maui. Achieving a network of grass-fed dairies across Hawaiʻi would spread out production and risk. It also aligns with trends in the dairy world favoring animal welfare (pasture-raised) and lower emissions (grass-fed systems can claim lower carbon footprints per certain studies). Hawaiʻi could market its milk as a premium, locally sustainable product if it follows that model.

From a competitiveness standpoint, to hit the target price of $3–$4 per half-gallon as planned on Kauai, Hawaiʻi dairies need to get cost of production down dramatically. That likely means maximizing grass (cheap feed) and minimizing imports of feed, and also requires throughput to spread fixed costs. It’s a tough equation but not impossible. New Zealand dairies operate on low cost grass systems successfully, albeit they have much larger scale. But Hawaiʻi can draw lessons from them. In fact, the Kauai plan explicitly mirrors New Zealand methods, and that abandoned Kauai plan by Ulupono had done extensive analysis showing grass-fed could work if herd and acreage are right and community accepts it.

In summary, Hawaiʻi Island’s dairy sector is at a turning point. According to Civil Beat, Hawaiʻi’s milk industry has a “rare chance to grow” from near-imperil. The combination of one remaining dairy to build upon, a clear public interest in local milk, and active proposals for new operations could mean a renaissance. The next dairy that opens on the Hawaiʻi Island (or statewide) will likely follow a “sustainable, grass-fed” model from New Zealand to avoid past pitfalls. If these efforts succeed, the Hawaiʻi Island could be central in restoring Hawaiʻi’s proud legacy of island dairies, bringing fresh local milk back to more of our tables.

• Sources:

  • Honolulu Civil Beat – “Hawaiʻi’s Imperiled Milk Industry Has a Rare Chance to Grow” (Mar. 2025)

  • Civil Beat – on Kauai dairy project and state ranking in milk

  • Civil Beat – “Hawaiʻi’s Last Dairy Under Fire for Environmental Law” (Sept. 2024)

  • Hawaiʻi Island Now – coverage of Cloverleaf Dairy potential lawsuit (2023)

  • Hawaiʻi Tribune-Herald – “Hawaiʻi Island Dairy closure ahead of schedule” (Apr. 2019)

  • Center for Food Safety – press release on Hawaiʻi Island Dairy settlement (2019)

  • Pacific Business News – on Meadow Gold and Cloverleaf transition (2020–22)