Mike McCloskey Turned Waste From a 20,000-Cow Dairy Into Revenue
The United States dairy industry has expanded its output without a comparable increase in its national herd. Between 1995 and 2025, the number of cows remained close to 9.5m, while average production rose from roughly 20 litres per cow per day to more than 29 litres. Annual milk production reached about 102bn litres, compared with 68bn litres three decades earlier. The number of farms declined as surviving operations became larger and more specialised.
Fair Oaks Farms, located between Chicago and Indianapolis, is among the larger and more technologically advanced operations. Its 20,000 Holstein cows are kept in free-stall barns and milked three times a day. Manure is moved through pipes, including a line nearly five kilometres long, to an anaerobic digester. The resulting biogas was previously used to produce electricity for sale to the local grid. After that contract ended, Mr McCloskey converted the system to produce compressed natural gas for trucks. The farm can now select between electricity, renewable gas and vehicle fuel according to the commercial return available.
The digester’s output is processed further. Long fibres are removed, dried and returned to the barns for use as cow bedding. The remaining liquid enters a Varcor unit developed and installed by Sedron Technologies at Fair Oaks. The equipment uses mechanical vapour recompression, a process also used in milk-powder plants, to evaporate the liquid and separate its components. It produces a solid organic fertiliser without odour or weed seeds, a liquid containing 10% ammonium nitrate, and water that can be used for irrigation or for the animals’ drinking supply.
The system changes how nutrients are applied to farmland. Instead of spreading liquid manure when storage lagoons need to be emptied, the farm can apply nutrients when crops require them. The ammonium nitrate can be handled like other liquid fertilisers, including through a planter or by spraying, without incorporation into the soil. Removing heavy tank traffic also reduces one source of soil compaction. At Fair Oaks, silage maize accounts for 55% of farm costs, and the system is intended to make direct seeding of that crop more practical.
Conventional confined-dairy effluent contains about 4% dry matter, meaning that most of what is transported is water. It is commonly held in lagoons for months, during which some nitrogen can escape as ammonia, before being spread by heavy equipment, often on wet ground. United States Department of Agriculture rules require the material to be injected or incorporated to limit further nitrogen losses. Researchers at the department have cited those application requirements as one reason direct drilling has been slow to spread on American dairy farms. Fair Oaks’s process also removes the need for lagoons and reduces odour, methane and ammonia emissions, as well as the risk of infiltration. Its organic fertilisers can be sold nationwide to intensive, higher-value crops.
Sedron finances, builds and operates the treatment plant rather than requiring the farm to buy it. The company receives a manure-treatment fee and sells the resulting biofertilisers. The model leaves the producer without the capital expense of owning the facility, but its current minimum viable scale in the United States is about 4,000 cows. Mr McCloskey founded Select Milk Producers, helped develop Fairlife ultrafiltered milk before it came under Coca-Cola’s ownership, and opened Fair Oaks to tourism, where annual visitors eventually reached 1m. He is also developing an integrated beef-production operation in Puerto Rico. He has described his test for innovation as reducing cost, improving efficiency or lowering the capital required, and has said that sustainability must increase a company’s profitability to be viable.
Argentina presents a different starting point: direct seeding is already standard in its agriculture, while the widespread agronomic use of liquid dairy waste remains limited. The scale of its farms is below that of Fair Oaks, but the approach of separating solids before moving effluent and applying nutrients according to crop needs can be adapted. Fair Oaks therefore uses manure for several outputs, including energy, bedding, fertiliser and water, within a single dairy operation.
