May 17, 2012

 

New dairy manufacturing factory boosts Nevada's dairy industry

 

 

With a new dry dairy ingredient-manufacturing facility under construction in Fallon, the dairy industry in Nevada is advancing.

 

Dairy Farmers of America Inc., a national cooperative of about 15,000 dairy farmers, is building the US$70 million state-of-the-art facility that will be able to produce dried dairy ingredients, such as whole milk powder.

 

"It going to be a great thing for Nevada export products," said Bob Shriver, an economic development consultant for the city of Fallon. "It's got long-range benefits for the area. Because of this, it could attract a lot of other potential industries and enhance the community of Fallon in general."

 

The plant is scheduled to be completed in summer 2013 and employ at least 40 people full-time, mostly in the production area. The 150,000-square-foot facility will be able to process two million pounds of raw milk and make about 250,000 pounds of dried dairy ingredients daily for domestic and global customers. The facility is located on a 31.5-acre parcel in Fallon's New River Business Park.

 

"We chose to build an ingredient facility in Fallon because the area is already home to a vibrant dairy industry," Glenn Wallace, chief operating officer for the company's ingredient division, said in an email. "We are confident this is a good opportunity for us to put a facility in a place where we can be successful."

 

Several factors contributed to the plant's location, including proximity to major international ports, a dedicated dairy supply and opportunities for expansion. Twenty-two dairies are in the Fallon area, but with the completion of the plant, Shriver sees an increase in the number of dairy cattle and more dairymen to fulfil the increasing needs of the plant.

 

The farms produce about 25 million pounds of milk a month, but that needs to be doubled to supply the new facility. The dairy farms have pledged to increase production by 25%, and the cooperative is looking to bring more producers.

 

Most of the milk now produced in the area is shipped to California processing plants, with the dairy owners paying for the transportation costs.

 

During construction, the economic impact is about US$54 million in Churchill County, officials said. Once complete, the facility is expected to bring in annual sales of about US$10 million a year.

 

"We will have domestic customers, but it is definitely geared toward the export market," said Pete Olson, a dairyman from Fallon and member of the board of directors for the co-op. "It's creating a product that the export market is currently demanding."

 

The dairy cooperative is seeking a new export market for the US, the world's top exporter is New Zealand, where products such as dry milk powder, cheese and butter are shipped to the EU, Asia and US

 

The dry whole milk ingredient produced by the Fallon facility will be marketed to emerging countries with no refrigeration and transportation systems that can't handle transportation of fresh milk, Olson said.

 

The milk powder often has long shelf life, and it can be reconstituted with water for a nutritional drink. Product prices range from US$3,000-4,000 per tonne.

 

"This is going to bring new dollars from offshore into Nevada," Olson said.