Two Canadian companies announced this week they will purchase major Wisconsin cheese companies.
First, Saputo Inc., the largest dairy processor in Canada, said it planned to buy Alto Dairy Cooperative for $160 million. Alto has the largest U.S. cheese plant east of the Mississippi River in Waupun and a smaller plant in Black Creek. Between them, they have 467 employees. Two years ago, Alto launched its first artisan cheese -- Black Creek Classic, and last year, released a pasture-grazed cheese.
Yesterday, Agropour, a Canadian dairy cooperative, announced it will buy Trega Foods, a cheese company that was formed by combining three of Northeast Wisconsin's oldest cheese plants. The sale is expected to be finalized by the end of February and will include the company's three cheese plants in Little Chute, Weyauwega and Luxemburg.
The eternal optimist in me says it's a good thing that Wisconsin is considered to be an attractive place to invest in -- it means our dairy infrastructure is healthy and robust.
The cynical side, however, wonders how many more Wisconsin cheese plants will fall into foreign investor hands, as the U.S. dollar continues to fall in value, milk prices continue to stay high, and the medium-sized cheese plants continue to be squeezed.
My prediction for Wisconsin cheese plants: the big will get bigger, the small will stay small and the mediums will combine with other mediums to stay competitive.
Why? It's too hard for medium-sized Wisconson commodity cheese companies to compete with the West without increasing volume. And the small guys will continue to stay small because most of them have diversified into high-end, higher-margin, small batch artisan cheeses. That's good for people like me who enjoy artisan cheeses, but sad for the companies and dairy farmers who have been selling milk and and making cheese at cooperatives and family-owned companies for 100 years.