By MELINDA DESLATTE

Associated Press

BATON ROUGE, La. (AP) -- Baton Rouge-based Kleinpeter Farms Dairy is packaging and distributing the milk of a one-time competitor whose dairy plant was destroyed by an explosion, with the first products from Smith Creamery set to hit supermarket shelves Tuesday.

Under the arrangement, Smith Creamery's milk, half and half, and heavy cream products will be sold at the 50 stores across southeastern Louisiana where they were stocked before the June explosion shuttered the facility. New stores also will be added.

The agreement between Kleinpeter and Mount Hermon-based Smith Creamery was announced Monday by members of both families, who have been friends for a decade.

"We followed Smith's recipe in how they want this product processed. We got it down, we did it right," said Jeff Kleinpeter, president of Kleinpeter Farms Dairy.

"It'll be just what everybody was used to," said Warren Smith, founder of Smith Creamery.

Kleinpeter said he's hoping the Smiths will rebuild their plant and the partnership can stem losses in the dwindling dairy industry in Louisiana. Michelle Hickman, with Smith Creamery, said the arrangement will give the creamery time to decide its future plans.

"We're going to take this opportunity to step back and determine if we're going to rebuild," Hickman said.

The June 22 explosion destroyed Smith Creamery, scattering debris for a half-mile in Washington Parish.

"We're going to continue our partnership until they're on their feet," Kleinpeter said.

An independently operated dairy since 1913, Kleinpeter is making a profit off the venture.

But because it's a larger company with a wider distribution network, Kleinpeter said his company can package and distribute Smith's milk more cheaply. So, Smith Creamery also will earn more on its products from the arrangement than it was bringing in on those items before the destruction of its facility.

Smith Creamery also made cream cheese and butter, though Kleinpeter isn't packaging and distributing those items. Smith began bottling its line of specialty milk, which is high in butterfat, in 2002.

Louisiana's dairy industry, which topped 1,100 farms 25 years ago, has shrunk to fewer than 150 farms today, according to state data compiled by the agriculture department and the LSU AgCenter.

Copyright 2011 The Associated Press.