By Karl Terry: Freedom Newspapers
LOVINGTON — Dairy Farmers of America announced Wednesday the immediate closing of its cheese plant in Lovington and layoff of its 61 employees there.
It was unclear what if any direct effect the plant’s closing might have on operations at Southwest Cheese, where permit applications to the New Mexico Environment Department indicate expansion may be a possibility.
Southwest Cheese is located between Clovis and Portales. Glanbia Foods owns 50 percent while DFA, a dairy farmers cooperative, and three other milk producers are partners.
During a press conference in Lovington Wednesday, DFA officials said the production at the Lovington plant would move to other facilities in California and Minnesota. DFA officials said DFA member dairies would experience minimal impacts from the closure. They said milk marketed to the Lovington plant would be absorbed at other DFA facilities with no planned change to hauling rates for members.
A human resources official with DFA said employees at the Lovington plant had been made aware of openings at other locations, including Southwest Cheese, where transfer might be possible.
Daryl Larson, DFA vice president of operations, said the Kansas City, Mo.-based milk marketing cooperative cannot continue to invest in a plant that has consistently performed below expectations. He noted the small production capacity at the plant made it tough to compete.
“Dairy Farmers of America has a responsibility to its dairy farmer members to operate profitably,” he said. “The decision to idle our Lovington plant reflects DFA’s commitment to eliminating economic vulnerabilities within our business structure.”
Southwest Cheese President Maurice Keane declined comment Wednesday, when asked about the effect the Lovington plant’s closing might have on local business or on any expansion plans at Southwest Cheese.
In an application for plant modification to the New Mexico Environment Department obtained by Freedom Newspapers, prepared by Class One Technical Services for Southwest Cheese, the introduction notes the proposed modifications to the plant would increase milk input at the plant from 7 million to 10 million pounds per day.
At Southwest Cheese’s grand opening last fall, plant officials noted the sprawling plant had ample room to grow by as much as 20 to 30 percent.
State economic development officials were in attendance at the Lovington press conference and said they are working on options for the plant site. They said those options wouldn’t necessarily include another milk plant operator.
The Lovington plant produced 40 million pounds of commodity cheddar cheese in 40-pound blocks annually for 2,000 customers.
Southwest Cheese is capable of producing more than 250 million pounds of cheese and 16.5 million pounds of whey annually. The plant employs approximately 200, according to its Web site.