TWIN FALLS, Idaho — The world’s largest producer of American-style cheese plans to invest $82 million to upgrade its two plants in Idaho’s Magic Valley.
The improvements will help Glanbia Foods increase production of high-end health and wellness products, derived from dairy, in Gooding and Twin Falls, said the company’s executive vice president and CFO, Daragh Maccabee.
Maccabee said the investment should only slightly increase the volume of milk needed to supply the plants, but it “enforces that Glanbia is here in this region to stay.
“Generally this project is about bringing more value to what we do have,” Maccabee said.
The upgrades should be completed by the second half of 2016, and will necessitate the hiring of about 50 more workers.
In Gooding, Glanbia currently produces WPC 34 — whey protein concentrate containing 34 percent protein. It’s added to foods and bakery products as a powder. The improvements will enable the plant to upgrade a portion of WPC 34 production to whey protein isolate, refined to contain 90 percent protein. WPI is used in sports nutrition products such as energy drinks, bars and protein powders.
“The demand growth is more in the higher end protein powder,” Maccabee said, adding whey was once considered a mere byproduct of cheese production.
Plans also call for the development of a new facility in Gooding for blending high-protein whey with outside products.
In Twin Falls, equipment will also be added to start production of lactoferrin, a microprotein found in small quantities in milk known to boost the immune system.
Lacoferrin, often added to baby formula, is produced initially as a liquid and must then be freeze-dried. The freeze-drying system in Gooding will be expanded to accommodate additional lactoferrin liquid produced in Twin Falls.
A 30-megawatt electrical substation will be built in Gooding to support the expansions.
Glanbia has been headquartered in Southern Idaho for 25 years and processes slightly less than a third of the 38 million pounds of milk Idaho producers yield each day.
The expansions will benefit from a 23 percent tax credit over a decade from Idaho’s new Tax Reimbursement Incentive, as well as a property tax exemption on the new construction value from the Gooding County Board of Commissioners.
Jan Rogers, executive director with Southern Idaho Economic Development, said discussions about the expansion have been ongoing for two years, and the new state incentive was “the last domino to fall to make this project.”
Idaho Wheat Commission executive director said Idaho’s strong dairy industry provides growers a good market for years when wheat doesn’t make milling grade.
“There has been a lot of tremendous investment in agricultural infrastructure and agriculture-related products in Southern Idaho in particular over the last five years,” Jacobsen said.
Bob Naerebout, executive director of Idaho Dairymen’s Association, said all of the region’s major processors have been growing to match dairies’ production.
“If they’re meeting customer demands, that’s important to the dairy sector also,” Naerebout said.
Naerebout said dairy margins will be tight in 2015 due to strong production and softening demand, but he’s optimistic about the long-term picture.