Future Looks Bright for Idaho's Dairy Industry

Businesses share insights into Idaho's dairy market.
2013-05-02T13:00:00Z Future Looks Bright for Idaho's Dairy IndustryBy Andrew Weeks - aweeks@magicvalley.com Twin Falls Times-News

This story will appear in "The Dairy Effect," a special section in the May 5 edition of the Times-News. Pick up a copy of the May 5 paper for other stories about Magic Valley's dairy industry and its widespread effects.

TWIN FALLS • Idaho’s dairy industry keeps on giving — milk, cheese, yogurt.

But the landscape is a little different than it used to be, say area dairymen, thanks to increased feed prices, new technology and a large yogurt facility that’s come to town.

The company, headquartered in New York, opened its Twin Falls plant in December and has increased competition, provided jobs and put Twin Falls and Idaho on the map.

Dairymen are generally excited about Chobani, said Rick Naerebout of the Idaho Dairyman’s Association.

“Idaho has seen a response in milk prices since Chobani’s announcement in December of 2011,” he said. “During the 2012 calendar year, Idaho’s average milk price increased over $1.00/cwt compared to years previous per USDA all-milk price reporting. This response began a full year before Chobani started running milk because other processors were concerned about losing milk supplies to Chobani when they began production.

“Idaho dairymen have battled through very difficult financial times the past four years and are again in 2013 experiencing negative margins due to high feed costs and lower milk prices. Chobani has created some optimism for Idaho dairymen in a market that has experienced very little optimism over the past few years.”

On the flip side, some area businesses such as Glanbia have felt little impact because of the yogurt plant.

“Thus far, Chobani’s presence in Twin Falls has had very little impact on the local competition from our vantage point,” said Jeff Williams, CEO of Glanbia. “They have not met their milk ramp-up targets, and milk is actually long in the area at the moment.

“Similarly, on the employee side, we haven’t seen much of an impact even though they have created several hundred new jobs.”

Williams said Glanbia prides itself on offering competitive base pay and benefits packages in order to recruit and retain good employees. The company has lost a few employees to Chobani, but not enough to worry about.

Randy Robinson, a lifelong dairyman and co-founder and CEO of High Desert Milk in Burley, said he also has felt little impact fromChobani. He and his five partners who founded the co-op in 2000 sell mostly to local cheese makers.

Businesses, however, might feel Chobani’s presence in another way.

“The biggest impact with the whole Chobani thing is just all the wastewater stuff,” said William Gilmartin, operations manager for Commercial Creamery Company in Jerome. “I know Twin is trying to beef up its wastewater system. I know Jerome is trying to beef up its wastewater system, everyone is trying to get prepared for all the increased wastewater for Chobani. ... Both cities want to plan for the future and so that could result in some increased sewage and possible tax hikes.”

Idaho’s overall dairy landscape as viewed by those closest to it?

Robinson, a lifelong dairyman, said that over the years he’s seen a lot of up and downs in the industry — “more downs than ups,” he said — but there’s still a lot of opportunity for young or experienced workers to find jobs. But in some cases you have to know technology, because just about everything has it anymore in the dairy industry, he said.

“We see a bright future for Glanbia and for the dairy industry overall in Idaho,” Williams said, “which is why we continue to invest in our Idaho operation.”

The company recently opened its Cheese InnovationCenter in Blackfoot and work continues on its corporate office building in Old Towne Twin Falls, both operations affirm the company’s “long-term commitment to the area and the dairy industry,” he said.

“Now is a great time to be in the dairy business as the developing world continues to grow and demand a better source of protein and has the money to buy it,” Williams said. “Dairy products fit in well in this space as a competitive, healthy protein source. The more product we can move into export channels, the tighter we keep the U.S. market, which results in better milk prices for our industry patrons.”

Copyright 2015 Twin Falls Times-News. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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