Throughout the nineteenth century Texas milk production was for the most part a haphazard, subsistence-type enterprise. Town dwellers as well as farm families kept milk cows, drank fresh milk, and made butter and cheese. Cheese manufacturing was the first dairying enterprise to become specialized and removed from the farm. After the Civil War, cheese makers of the old dairy belt stretching from New York to Wisconsin produced most of the cheese consumed in Texas. Even as late as the 1930s cheese manufacturing in Texas was small-scale. Gail Borden established a condensed-milk plant at Bordenville in 1872, but most of the canned milk sold in Texas during the nineteenth century was produced and processed in the northern states. Texas farmers, however, continued to produce most of the fresh milk and butter consumed in the state. As cities became larger, nearby enterprising farmers established milk routes to deliver milk and butter to residents. Very slowly, specialization in butter manufacturing developed. Several small creameries established in the 1880s failed, but by 1900 twelve creameries were in operation in Texas.
Thereafter, the market for cream separators expanded rapidly as farmers saw the advantage of marketing their surplus. They sold cream to local creameries, or shipped it on the railroad to distant ones, and fed the skim milk to the hogs. A Texas Dairymen's Association was founded at Waco in 1918, and although it did not survive World War I, it did help to promote commercial dairying. By 1914 about 100 creameries in Texas were producing over five million pounds of butter annually. Nevertheless, a dozen times that much was still produced at home, and most of it was consumed on farms where it was produced.
Most of the milk produced in Texas continued to be consumed as fluid milk. Specialization in processing, packaging, and marketing developed slowly in the early twentieth century, as urban growth and technological progress took place. Effective machines for pasteurizing milk first came on the market in 1895, and in the same year a steam-powered bottle washer was patented. Fear of tuberculosis and undulant fever brought demands for pasteurization from urban residents, who were drinking milk from cows they never saw. Most of the cities in Texas had adopted compulsory pasteurization by 1927, when 874 cities in the United States had such ordinances. In the rural areas of the state, the earlier patterns of production and marketing had changed little by the end of the 1920s. The number of creameries had grown little since 1914, but pounds of butter sold had increased to 14,634,612 by 1929.
In the 1930s the dairy industry in Texas began changing rapidly as national companies like Borden established processing plants and distributing centers in the state. Several organizations like the Southwestern Dairy Association were already in existence, and in 1939 Texas had 228 dairy-products plants in operation. Separating milk and selling cream continued, but nonspecialist dairy farmers who lived far from cities were no longer restricted to selling cream. Better roads and rubber-tired vehicles brought dependable and regular milk routes, enabling farmers to sell a few cans a day as grade B milk to cheese plants, of which the first in the state was established in 1928. All along, however, most of the Texas milk production continued to take place in the eastern third of the state.
Growth accelerated as World War II brought an unusual increase in demand for dairy products, and Texas farmers responded by increasing production. The number of dairy cows in Texas had been increasing slowly since 1900, growing from 1,034,000 in 1914 to 1,146,768 in 1939, but during the war the number increased to 1,594,000. Milk production increased accordingly. After the war, however, expansion brought new problems as milk prices declined. Almost all grade A milk producers were by then wholesaling their product to processors, and dairy farmers complained that they were at the mercy of the handlers who purchased their milk. Such conditions led to the establishment and growth of producer bargaining associations. The South Texas Producers Association had already emerged in the Houston area during the 1930s. After World War II it was joined by the North Texas Producers Association and other regional producers' organizations. Dairy farmers were also aided by the advent of federal marketing orders in Texas in 1949. By the 1980s all milk sold in the state was marketed under federal marketing orders. One North Texas dairy farmer said, "I've milked by candle light, lantern light, and electric light, but never got fair tests or fair prices until we got a federal marketing order and the North Texas Producers Association."
Lower prices and hard times in the late 1940s were only a prelude of things to come. During the later 1950s milk-price wars broke out in Texas. Gallon jugs were sold by gasoline stations, and small retailers engaged in cutthroat competition. Cheap transportation brought fluid milk from Wisconsin and Minnesota to drive Texas prices down. General instability led to mergers of small regional producer organizations into huge multimarket associations. By 1969 Associated Milk Producers, Incorporated, had emerged. With over 40,000 producer-members from Texas to the Canadian border, it dominated milk marketing in mid-America. Although its power was diminished in the 1970s, in the 1980s most Texas producers were still marketing milk as members of that organization. General price stability at profitable levels for efficient producers was the rule through the 1970s, but a growing national dairy surplus posed a threat to Texas milk producers.
In the years from World War II to the 1980s the structure of Texas dairying underwent revolutionary changes in addition to the changes in marketing already described. Most striking was the decline in the number of milk cows, from 1,594,000 in 1945 to 355,000 in 1971, after which the decline continued at a much slower pace; in 1983 there were 335,000 on Texas farms. The number of producers declined sharply as well, and in 1981 there were only 2,600 commercial dairy farms in Texas. But total milk production slipped only from 3,750,000 pounds in 1948 to 3,680,000 pounds in 1982. The release of millions of acres of land normally devoted to cotton between 1930 and 1940 stimulated dairy production. With the growth of large, specialized dairy farms new practices were instituted, including improved herd management and expansion of artificial-insemination programs. Jersey, Holstein, and Guernsey cattle became the dominant breeds. The shift toward grade A production and participation in pasture-improvement programs also played a part. As a result of these factors annual production per cow grew from 2,820 to 11,459 pounds between 1925 and 1982.
In the 1980s milk production still centered in the eastern part of the state, with more than 90 percent produced east of a line from Wichita Falls to Brownwood to San Antonio to Corpus Christi. No longer, however, did urban counties lead in milk production. Until the 1950s Harris, Dallas, Tarrant, and Bexar counties usually led as milk producers. In the 1980s Hopkins, Erath, and Wise counties were leading; these three counties accounted for about 30 percent of the state's product, and Hopkins County alone produced 16 percent of the Texas total. Texas generally ranked in the top ten states of the nation in milk production during the 1970s and 1980s, and Texas farmers received a gross income of $504,583,000 from milk in 1980.
Although Texas has never been important in cheese and butter manufacture, it is a major ice cream manufacturing state and since the 1950s has led the nation in mellorine production, usually producing about half the annual national product. Noticeable changes in the processing and marketing of dairy products took place between World War II and the 1980s. There was a big decline in the number of dairy plants as many small firms disappeared. Home delivery of milk virtually ceased. Finally, supermarkets like H-E-B collectively became more important as processors and retailers of milk and dairy products than national dairy firms like Borden. See also DAIRY PRODUCTS, and BLUE BELL ICE CREAM.