Los Banos milk plant shutting down, 63 workers to lose jobs

Visalia-based California Dairies Inc., the largest milk cooperative in the state, is shutting down its Los Banos factory, citing a decline in milk volume.

“California Dairies has been an important employer in Los Banos since 1925,” said Alex Terrazas, Los Banos city manager. “It’s incredibly unfortunate they will be closing and we’d hope folks will be able to find jobs in Los Banos.”

The plant that first started out as San Joaquin Valley Dairymen has been in operation for decades. The shutdown will displace 63 workers and take about 60 days to ramp down production.

“The Los Banos plant has been a valued facility with a long history that has served California Dairies and its members well. Unfortunately, the declining volume of milk in California is affecting the entire dairy industry, and CDI is not immune,” said chief executive officer Andrei Mikhalevsky. “These reduced milk volumes, combined with the high cost of operating our Los Banos facility, are the sole drivers behind the decision. This decision is in no way a reflection on the hard work of our talented employees in Los Banos or the high-quality products they have produced.”

The milk plant was a staple in Los Banos and an employer for many families over the decades, said Stacy Souza Elms, community and economic development director for the city of Los Banos. The closure will have an effect on the community, she said.

“It’s a sad loss for us,” Souza Elms said.

The city of Los Banos and Merced County are working with Workforce Investment to see if workers can be transitioned into other employment, Souza Elms said.

“Hopefully this gives us an opportunity to revitalize the area and have further economic development there,” she said.

California Dairies Inc. used the Los Banos plant to make cream cheese and Neufchâtel, a soft, slightly crumbly, mold-ripened cheese. The cooperative’s five other plants will not be affected, Mikhalevsky said.

The plant was easy to spot as you drive through Los Banos on Highway 152.

As the state’s largest milk producer, California Dairies pumps out 43 percent of the state’s milk supply. Its dairy products, including Challenge and Danish Creamery butter, are sold in all 50 United States and more than 50 countries.

This story was originally published January 17, 2018 at 4:10 PM with the headline "Los Banos milk plant shutting down, 63 workers to lose jobs."