LITTLE ROCK – The closure of Yarnell's Premium Ice Cream, after more than 75 years in business, is the latest blow to Arkansas" disappearing dairy industry.
"Yarnell's was one of the last major processors in Arkansas," said Wayne Kellogg, an animal science professor with the University of Arkansas Division of Agriculture, adding that with high fuel prices, "running a processing operation is expensive."
The dairy industry in Arkansas has dwindled in the past three decades. By 2009, Arkansas had just 140 dairy farms, compared with 852 a decade earlier, according to the Encyclopedia of Arkansas.
Kellogg said the decline is due to a combination of factors including a climate that's too hot for ideal dairy conditions, tax incentives to the dairy industry in other states, and the relatively high cost of feeds best for dairy cows – which are about 50 percent of the production cost.
Other factors include dairy farmers retiring and some switching to beef. "Natural gas leases encouraged several to change," he said.
There are a handful of dairy processors remaining in Arkansas, including a Kraft cheese plant in Bentonville, Hiland Dairy plants in Fayetteville and Fort Smith, and a Coleman Turner plant in Little Rock.
In a news release, CEO Christina Yarnell said: "This has been an extremely tough year for the ice cream industry in general, and particularly to regional, independent manufacturers like ourselves.
"We have examined many possible avenues to keep the company afloat – actively marketing the company to investors and strategic buyers – the majority of whom are undergoing the same financial distress we are," she said. "However, we've been unable to obtain additional financing from our lenders or locate a buyer, and have come to the difficult decision that the appropriate course of action is to shut our doors."
Approximately 75 percent of Yarnell's employees work at the Searcy headquarters, with the rest of the employee base located throughout the state and in Tennessee and Mississippi. A small team will remain working for the company to finalize operations, with completion expected by Aug. 27.
"Our whole county is shocked and saddened about the news," said Brian Haller, White County extension staff chair for the University of Arkansas Division of Agriculture.
Haller said the Yarnell family has strong agriculture ties.
"Back many years ago, they owned a dairy that help produce the milk used for the ice cream plant," he said. "The farm sold several years ago and is now a beef cattle ranch, but it is still affectionately known as the Yarnell Farm.
"Yarnell's is an icon for White County and Searcy that will be terribly missed," Haller said. "Other than the nostalgia, it is very sad that 200 people will be out of work in a time when jobs aren't plentiful."
"Yarnell's has always been good to the community," he said. "We will be losing more than just good ice cream."