Simplot to open one plant, close three

John O'Connell/Capital Press J.R. Simplot Co. announced Wednesday it intends to close the Aberdeen facility and two other Idaho plants, likely in 2014. The company intends to build a new processing plant in Caldwell. The Aberdeen facility employs 290 workers and is the largest employer in the rural southeast Idaho community.

New $330 million facility expected to open in 2014

By JOHN O'CONNELL

Capital Press

Officials with J.R. Simplot Co. announced Nov. 9 they intend to build an expansive potato processing plant in Caldwell but will close three other Idaho facilities.

Construction of the planned 380,000-square-foot processing plant in Caldwell will represent Simplot's largest investment ever in Idaho, according to a press release.

At roughly $330 million, Dan Hargraves, executive director of the Southern Idaho Potato Cooperative, said he's delighted Simplot is making such a substantial investment in Idaho.

"One of my fears was they would close the Caldwell processing facility and not replace it like they did in Heyburn in the late 1990s," said Hargraves, who began his career working at Simplot's Heyburn plant. "There's no reduction in their raw product needs. We're excited about the potential to have a state-of-the-art processing plant in Idaho."

The agri-business company also announced plans to close its existing Caldwell plant, with additional closures of its Aberdeen and Nampa facilities within the next two to three years.

Those closures will result in the loss of nearly 800 jobs, according to a corporate press release. The company indicated most of the jobs won't be lost until the three existing plants close.

"The new plant will employ about 250 people, so there will not be job opportunities for all of those displaced by the closures," Simplot president and CEO Bill Whitacre said.

Simplot is the largest employer in Aberdeen. Aberdeen Mayor Morgan Anderson said he learned of the plans when the company hosted a meeting for Power, Bingham and Bannock county elected officials that morning in Pocatello.

"It could be a great impact unless we get something to fill in for them," Anderson said.

Whitacre said the new plant will have an output equivalent to the three existing plants, and the cost of renovating those plants would have been equal to the cost of building the new facility.

Ground will be broken next spring for the new facility, scheduled for completion in the spring of 2014.

Whitacre said the company will work to ease the transition for displaced workers by providing separation packages, on-site counseling, placement services and other assistance.

"We struggled with this very difficult decision, and we know the closures will have an impact on many of our employees and their families," Whitacre said.

Whitacre said current employees will be invited to apply for jobs at the new Caldwell facility.

The company has not yet selected a construction management firm but vows to use many local engineering firms, with Burns & McDonnell of Kansas City, Mo., chosen as the primary design firm.

"Unfortunately, our current Idaho plants lack the flexibility, processing capability and energy efficiency that we need to be sustainable," Whitacre said.

Simplot indicated that Caldwell was chosen based on its rail and road access, water, raw potatoes and other inputs, skilled labor force and energy considerations.

"In addition, the selection of Caldwell pays tribute to the fact that our founder chose the site for his first dehydrating operation and subsequently expanded into potato processing there," Mark McKellar, Simplot Food Group president, said in the press release.

Simplot bought the Aberdeen plant from Nestle in 2000. The plant opened in 1973. Simplot opened its Caldwell site for dehydrating potatoes in 1941 and converted it for frozen potato processing in the early 1950s.

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