Kraft Foods Will Close Rupert Plant

By Bob Kirkpatrick, The Times-News, Twin Falls, Idaho,

May 17–RUPERT — Kraft Foods Inc., the nation’s largest food manufacturer, said Tuesday it will close its manufacturing facility in Rupert early next year.

The announcement sparked concerns about Mini-Cassia’s economy and promises of help for displaced workers from state and local governments.

The 54,000-square-foot plant, which makes cream and string cheeses, will close its doors Jan. 5, sending more than 140 workers to the unemployment line.

The move comes as part of Kraft’s nationwide effort to consolidate production facilities.

“We have several plants across the U.S. that make similar products,” said Cathy Pernu, Kraft spokeswoman. “The consolidation of our production facilities allows us to take advantage of our manufacturing scale for our cream and string cheese products.”

Production will shift to existing Kraft plants in Missouri, New York and Wisconsin. Pernu said the restructuring will help the company build a stronger platform for growth.

A Rupert official said the plant closure is bad news for Mini-Cassia.

“I think it will have a strong economic impact,” said Roger Bagley, Rupert’s city administrator. “Any time you lose 140 jobs it’s going to hurt for a period of time.”

One employee who will find himself out of a job in January had mixed reactions to the announcement.

“I knew something was going on because the company was closing down plants across the country,” said equipment operator Rutilio Ronquillo, 53, of Burley. “But the news still came as a big surprise to all of us when we were notified at 6:30 a.m. Tuesday morning.”

Ronquillo, who has been employed at the Rupert plant for the past 16 years, said he felt badly for co-workers who haven’t worked for Kraft very long, especially those who just purchased new homes and automobiles. But he said he was also grateful to the company because he was able to put his son and daughter through college on his Kraft income.

Ronquillo’s wife, Juanita, who works for the Burley School District, said the closure will be hard on her husband, but they will get by.

“My husband is too young to retire and too old to start a new career,” Juanita Ronquillo said. “But the Lord has been good to us, and we’ll find a way to keep going.”

Her husband was equally optimistic.

“I’m a little confused about the whole thing right now. I’m sure I’ll miss the money — I make $15 an hour — but we will survive,” Rutilio Ronquillo said. “I can do anything. I’ll even clean toilets if I have to.”

Bagley said he thinks Kraft’s announcement may be misconstrued by some local residents.

“We are in the process of upgrading our wastewater treatment facility and have to raise rates to pay down our debt service,” Bagley said. “So we don’t want people to think we drove Kraft away. The move came about because of the company’s decision to consolidate.”

Bagley said he knows Kraft employees will face the difficult challenge of finding work come January. But he said the city has been in contact with Idaho Commerce and Labor to do “what we can to re-educate people to help them find alternative employment.”

Kraft said it plans to sell the cheese plant on South Oneida once production ends. Bagley said the city of Rupert will do all it can to find another business to occupy the structure. He said Kraft officials told him the company will sell it to any industrial user, which could include a dairy-products business.

Greg Rogers, a regional economist for Idaho Commerce and Labor, said Tuesday he hadn’t received advance notice of the closure. He will quickly analyze the economic effect on Kraft employees and on Mini-Cassia; his analysis should be available sometime today.

Pernu declined to specify the Rupert plant’s wage range. But Rogers said he thought the average wage of the 93 full-time and 50 part-time employees is between $11 and $12 an hour, not including benefits.

Kraft said it will offer a separation package to help employees while they find new jobs.

“We are committed to helping employees through this transition,” Pernu said. “The separation benefits package, including severance pay, will be based on the number of years of service. The company has also decided to extend medical benefits for six months following each employee’s last day of employment.”

Pernu said Kraft will also provide job-search assistance. The company will hire an outside firm to help the displaced workers improve their interviewing skills and update resumes.

In a press release Tuesday afternoon, Lt. Gov. Jim Risch said he’ll appoint a rapid-response team of organized labor, education, business and local government leaders, as well as Idaho Commerce and Labor representatives, to provide unemployment insurance, career guidance, job-search assistance and information on labor market conditions and training programs.

“Our goal is to make this transition as easy as possible for the affected workers and area businesses,” Risch said. “We are also doing everything we can to work with the local economic development groups to bring new businesses into the area.”

Kraft opened at its current Rupert location in 1935, started cream cheese production there in 1967 and introduced string cheese there in 2004. In 2001, Kraft purchased adjacent property to construct a cream cheese cooler warehouse and to double its milk unloading and storage capacity.

In December 2004, Kraft laid off nearly 50 Rupert employees due to a shift in the volume of string cheese production, as the company quit purchasing milk directly from small dairies.

Times-News business writer Bob Kirkpatrick can be reached at 735-3376 or bkirkpatrick@magicvalley.com.

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