MEDC: Planned milk processor will curb MI farming costs

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ST. JOHNS, Mich. (WOOD) — The Michigan Strategic Fund board has approved incentives to create one of the largest dairy processing facilities in the country right here in Michigan.

Supporters of Spartan Michigan LLC say its $510 million investment will save Michigan dairy farms money by virtually eliminating high transportation costs stemming from a lack of milk processing facilities in the state. The group says last year alone, Michigan milk producers lost more than $164 million because of high shipping costs and lower milk prices due to a supply glut.

The new facility will be located on a 146-acre site in St. Johns, north of Lansing, and process more than 8 million pounds of milk a day, according to the Michigan Economic Development Corporation. 

State officials say the collaboration to create the massive facility is unprecedented. Glanbia, Select Milk Producers and Dairy Farmers of America will invest $425 million into the milk processing plant, creating up to 259 jobs. While not an investor, the Michigan Milk Producers Association is also expected to supply milk.

Additionally, Proliant Dairy will contribute $85 million and hire up to 38 workers for an adjoining facility that will use milk byproducts to create whey powder for people and animals.

State officials say having both processors on the same site will virtually eliminate the cost of transporting byproducts to another state, saving money for Michigan’s 1,747 farms, which contribute $15.7 billion to the state economy.

“This is tremendous news for the dairy farmers in our state,” Michigan Department of Agriculture and Rural Development Director Gordon Wenk stated in a Thursday news release. “Almost every dairy farm in Michigan is family-owned. It’s been very difficult to watch so many hard-working people struggle unnecessarily.”

Michigan is the fifth largest milk producer in the country, according to state officials. Gov. Rick Snyder released the following statement after Thursday’s announcement:

“Once again, Michigan’s national reputation as the best place to grow jobs is bringing new investments to our thriving agriculture sector. Michigan’s dairy industry is an essential economic driver in our state, and this new investment elevates and expands our potential to rise even higher while bringing new jobs and opportunities to this region.”

The Michigan Strategic Fund board Thursday approved a 15-year Agricultural Processing Renaissance Zone designation for the project, which has also been awarded a range of grants, investments and tax breaks from the MDARD and the Michigan Department of Transportation.

Construction is expected to begin in September and wrap up by December 2020.

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