Office of the Governor
For Immediate Release: Friday, October 26, 2001
For More Information: Mary Lehecka Nelson, 773-5032, or Bob Mercer, 773-3212

Janklow: Davisco Expansion Has Potential For Huge Economic Impact On South Dakota

(Pierre) - Gov. Bill Janklow and Davisco Foods International announced Davisco’s plan to invest $50 million to build a mozzarella cheese plant in Lake Norden, a move that could result in a $300 million investment in new cows and facilities on South Dakota farms. The announcement was made today, Oct. 26, 2001. 

"This is a huge deal for the State of South Dakota," Janklow said. "As a matter of fact, Davisco's investment in this new cheese plant and the accompanying investment in the dairy herds to supply the milk make this the largest one-time free enterprise investment in the history of our state."

In addition to the new capital investment, Janklow said that this announcement solidifies the retention of Davisco's existing $35 million whey operation in Lake Norden and its 90 employees at the current plant.

The new plant will add 60 jobs to Davisco's workforce in Lake Norden. "This in and of itself is great news," Janklow said. "But consider that another 750 primary jobs will be created as a result of the additional 3.8 million pounds of milk needed by the plant each day. Now you’re talking nearly 800 primary jobs. Add in the spin-off effect an expansion of this size will have and you can start to see the tremendous impact." 

"This is a major investment for us at Davisco that represents an expanded partnership between the state of South Dakota, Lake Norden, Land O’ Lakes, our employees, and area milk producers," said Mark Davis, CEO of Davisco Foods International. Land O’ Lakes will market the cheese produced at the new plant, and partner with Davisco Foods International in milk procurement for the plant.

"The expanded Lake Norden facility will give area farmers a steady and reliable market for milk and make it possible for Davisco to increase our overall cheese production capabilities," Davis said. "The added value here is the whey produced at the cheese plant that we will process at our food ingredient plant to make our specialty whey protein isolates. We are very excited to move forward together with this innovative project."

"The project, and this partnership, will significantly enhance the region’s dairy infrastructure and contribute to the long-term success of area producers," Land O’Lakes President and Chief Executive Officer Jack Gherty said. "We are at a point where critical mass and economies of scale are vital to dairy industry success, this new partnership and plant project address those issues."

Janklow said that at a time when our farmers need to find new markets for their products, South Dakota is fortunate to have the opportunity to partner with two companies that share the state’s commitment to keeping South Dakota agriculture strong. "We have worked hard in South Dakota to create a favorable economic environment that makes it possible for Davisco Foods International to expand here in Lake Norden. It’s good to see our efforts are paying off," he added.

The plant currently processes whey, a by-product of cheese manufacturing, to produce specialized food ingredients including whey protein isolates, which have numerous applications including sports and nutritional supplement drinks. The new plant will produce cheese using state-of-the art technology and provide whey as the necessary raw material for the food ingredient plant. 

Davisco Foods has operated the Lake Norden facility for nearly 20 years. Construction on the project will start soon.

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