August 19,2016-
Construction of Tulare’s $250 million CaliCheese plant is on hold pending both financing and resolution of California dairy policy on how much cheese makers are to pay producers for milk needed in their cheese vats. So says Robert Moultrie who represents the company.
First proposed in 2012 Moultrie had earlier estimated the start-up plant would be able to break ground in 2015 on 59 acres they are scheduled to buy from the City of Tulare. As of now the company has not bought the land confirms Moultrie who says they have until the end of this year to buy the dirt. All other approvals are in place.
“We should know more in few weeks if the state will change the 4b formula” says Moultrie,referring to the milk pricing formula in place in California. Ag Secretary Ross ordered a one-year increase in the 4b price on August 1,2015 that just expired in the past few weeks. She recently made the change permanent.
Moultrie says it is not known if California’s dairymen want to continue to operate under state rules or switch to a federal order – all of which could affect the cheese-milk price going forward.
Moultrie warns that “as it is – the CaliCheese project is not feasible.” He adds that ” the increase in the whey price added $22 million to the cost of the milk” at the proposed cheese plant located at the corner of Avenue 216 (Paige Avenue) and Road 84.The plant will need 4 million pounds of milk a day. The facility was to employ over 200.
“I’m still hopeful they stick to the plan” says Tulare Mayor David Macedo.
Moultrie had earlier spoken optimistically of a 10-year contract in place to sell all the cheese they make at the plant that had secured financing needed. But higher milk input costs appear to have potentially scuttled this plan.“The cost of milk is 86% of the total cost to operate the plant.This is having a huge effect on our bottom line.”