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Dairymen Inc.'s pioneering efforts may be paying off a decade after it introduced milk in a box that could be stored without refrigeration.

Business was slow during the past 10 years, but supermarket sales of the milk surged 44 percent last year over 1989 sales, mainly because of new chocolate milk products introduced by Hershey Chocolate Co. and Nestle Co., which are both best known for their candy.The vacuum-packed liquid milk, commonly called UHT for ultra-high temperature, has been accepted for years in Europe and other countries.

But when Dairymen came out with the milk in 1981, Americans thought it was weird. They couldn't believe milk that could be stored on a shelf could be real and taste good.

Any turnaround would be good news for the 4,000 farmers in the financially struggling milk cooperative, based in Louisville.

Last year, Dairymen closed four plants, reported a $9.7 million loss and a 23 percent drain of membership as dairy farmers retired or left the cooperative to join others or become independent.

The cooperative's investment in the sterilized vacuum-packed milk products initially caused dissension among farmers in the cooperative. Some ridiculed the product and objected to spending money on a Savannah, Ga., plant where the milk was processed and packaged.

Now, Dairymen's label, Farm Best, is ranked No. 3 behind Yoo-Hoo and Hershey's chocolate drinks. But Farm Best actually controls more of the market share than anyone else because it processes and packages the milk for Yoo-Hoo, Hershey's and Weight Watchers.

Besides Dairymen, only three other companies hold significant shares of the UHT market: Gossner in Cache County, Real Fresh in California and Kansas Food Packers in Kansas.

"The market is growing tremendously and the demand for UHT products is surging,' said Dan Shaw, spokesman for Dairymen. However, he would not give figures on the cooperative's sales of UHT milk products.

Shaw believes the growing sales of UHT milk products are because of consumer acceptance of such products as microwave dinners that don't have to be refrigerated and boxes of juices for children.

UHT is a method for pasteurizing milk and sterilizing other foods at high temperatures and then cooling them quickly and packaging them.

Recently, UHT milk has been visible in the diets of American soldiers stationed in the Persian Gulf. In newscasts, soldiers on television could be seen drinking the milk, which had been stored in the desert without refrigeration and chilled in small portable refrigerators before opening.