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Major expansion backed for Lethbridge cheese plant

Alberta dairy farmers can expect up to $15 million more per year in revenue as Agropur moves to expand its cheesemaking business in the province.

In what’s billed as “the first major expansion in decades” for the cheese industry in Alberta, the Longeuil, Que.-based dairy processing co-operative has budgeted $23 million for additions and automation work at its Sunnyrose cheese plant, about 10 km north of Lethbridge at Diamond City.

About 10 per cent of the project cost is to be covered by a joint federal/provincial grant worth $2.4 million over two years. The grant was pledged Wednesday from the joint Growing Forward ag policy funding framework, and is to be paid in through the Alberta Livestock and Meat Agency (ALMA).

Agropur, which bought the Sunnyrose plant from private owners in 1998, expects to complete its project by the end of 2011, a company spokesperson said Thursday.

The expansion, the company said, will allow Sunnyrose to “nearly double” its production capacity for cheeses it already makes, and add to its product lineup in “novelties” such as specialty cheeses with spices (for example, Monterey Jack with jalapeno).

The plant’s current production includes Anco and Kraft brand cheeses, as well as Lucerne brand cheeses sold at Canada Safeway.

To accommodate the Sunnyrose expansion, Agropur plans to double its milk allocation in Alberta in 2011-12. The co-operative said it has an agreement in place with the Alberta Milk Marketing Board to support such an increase.

“Readily available”

Moving Alberta milk from the butter and skim milk powder markets into the cheese market is expected to boost revenue to producers, the governments said Wednesday.

“Agropur invests continuously in its plants in order to maintain its growth and meet consumer needs,” Louis Lefebvre, president of Agropur’s cheese and functional products division, said in the joint federal/provincial release.

“The Diamond City investment, one of Agropur’s largest in Canada in recent years in the cheese-making sector, will enable us to increase our production capacity in an area where milk is readily available.”

The company’s larger expansions in recent years have leaned mostly southward, through acquisitions of dairy companies in Minnesota, Iowa and Michigan, and a joint dairy venture with South American processor Adecoagro.

But in Canada, meanwhile, the co-operative has moved to close some of its operations, such as its Lamothe dairy at Drummondville, Que. in late 2009 and its Sudbury, Ont. milk plant, now scheduled to shut permanently at the end of January 2011.

Agropur’s other dairy product lines in North America include brands such as Yoplait, Natrel, Canadian Reserve, Sealtest, Oka, Island Farms, La Lacteo, Trega and Schroeder. It also acts as a subcontractor for Canadian production of international brands such as French cheese snacks Mini Babybel and The Laughing Cow.

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