ARDEN HILLS, Minn., Jan. 15 /PRNewswire/ -- Land O'Lakes, in an action that reflects a continuing focus on optimal efficiency, is shutting down its whey production operation at Perham, Minn., Land O'Lakes Vice President for Dairy Foods Operations and Supply Chain Fernando Palacios announced today.
"In today's highly competitive, and consolidating, dairy foods industry, operating efficiency is essential to our ability to effectively serve customers and generate appropriate returns for our member-owners," Palacios said. "Therefore, we are continually evaluating all of our facilities, processes and policies, with an eye to achieving maximum efficiency.
"Land O'Lakes has a long history in Perham, and this was a very difficult decision," he continued. "However, in terms of industry economics, Land O'Lakes strategic direction, our system's long-term success, and our commitment to serving the interests of our members, this was a very appropriate decision."
When evaluating production facilities, Land O'Lakes looks at a wide range of factors including plant age and condition, plant capacity and current production levels, overall efficiency, market trends and customer demands, and regional milk supply and milk production trends, Palacios said.
The Perham facility, which was built in 1942, has been operating at less than full capacity, a situation complicated by market trends and the cost of transporting whey to the facility for processing, he explained.
Company officials indicated whey processing at Perham will cease by late January. Perham's whey processing volume will be transferred to Land O'Lakes facilities in Pine Island, Minn., Spencer, Wisc., and Kiel, Wisc. Milk procurement and hauling will not be affected, since the Perham plant has not been receiving raw milk.
The plant has forty-six employees and severance packages will be provided. Perham employees will also have the opportunity to pursue available employment opportunities at other facilities within the Land O'Lakes system.
Land O'Lakes ( www.landolakesinc.com ) is a national, farmer-owned food and agricultural cooperative, with sales of $6 billion. Land O'Lakes does business in all 50 states and more than 50 countries. It is a leading marketer of a full line of dairy-based consumer, foodservice and food ingredient products across the United States; serves its international customers with a variety of food and animal feed ingredients; and provides farmers and local cooperatives with an extensive line of agricultural supplies (feed, seed, crop nutrients and crop protection products) and services.