Region’s agribusiness sector thrives in 2010

All in all, Northern Colorado agribusiness had a good year in 2010, with a banner harvest for most crops, construction of a cheese factory getting under way in Greeley, and a major merger for the area’s biggest meat producer.

The dairy industry has been ailing not just in Northern Colorado but across the nation. Local milk producers got a huge boost of hope when Leprino Foods finally began construction this summer on its new mozzarella production facility in Greeley.

The facility, which will eventually total more than 880,000 square feet, will start with a 127,000-square-foot building to produce powdered milk, scheduled to open in 2011. The four-phase project, expected to eventually employ up to 500 people, will be completed over the next few years as market conditions allow, according to Mike Reidy, Leprino vice president.

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At full build-out the factory is expected to consume up to 7 million pounds of milk daily and provide a welcome partner for local dairies struggling with low milk prices the last couple of years. Denver-based Leprino has a contract to buy its milk from local dairies that are part of the Dairy Farmers of America cooperative.

Greeley-based JBS USA – a subsidiary of Brazil-based meatpacking giant JBS S.A. – took some more giant steps in 2010. The company merged with Pilgrim’s Pride, the nation’s second-largest chicken processor, and between 300 and 400 Pilgrim’s Pride management employees moved from Texas to Northern Colorado this year to work out of the JBS USA headquarters in the Promontory development in west Greeley.

The company also opened a new JBS Carriers trucking facility in east Greeley on U.S. Highway 85, where about 200 truckers and office workers will be based. And JBS moved to advance its U.S. cattle-feeding capacity in 2010, entering into an agreement last summer to buy Arizona-based McElhaney Feedyard, which can feed up to 130,000 cattle at a time.

The purchase, which is still awaiting regulatory approval, was made through Loveland-based Five Rivers Cattle Feeding LLC, acquired by JBS in 2008. Five Rivers has 10 feedlots in five states capable of feeding up to 800,000 cattle.

As 2010 wound down, Johnson Dairy near Eaton, once one of the state’s biggest dairies, was poised to emerge from Chapter 11 bankruptcy. The dairy, owned by John D. Johnson and at one time boasting more than 10,000 cows, filed for bankruptcy in January 2009 and declaring debts of more than $50 million.

The dairy, which grew rapidly in the early 2000s, received several loans from the now-defunct New Frontier Bank in Greeley. Johnson claimed the bank pressured him into taking loans he didn’t need and couldn’t repay.

In October, a federal bankruptcy judge approved a reorganization plan for the dairy to continue operating to pay off the remainder of its debts and give the operation a new start.

Timely moisture produces big yields

After a dry beginning, the region began getting plentiful moisture in March that resulted in banner harvests for most local crops. Corn, wheat and sugar beet growers in particular brought in bountiful crops, with Mark Sponsler, executive director of Colorado Corn, saying in late October that the state was poised to “have one of its best (corn) crops ever.”

Winter wheat also was expecting a record or near-record crop for the year, with an average 45-bushels-per-acre yield that was the highest ever recorded in Colorado.

The region’s wheat farmers got some more good news in November when Limagrain, the biggest plant breeder and seed producer in Europe, announced it had selected Fort Collins for its American headquarters.

Frank Curtis, Limagrain Cereal Seeds executive vice president and COO, said the company would be setting up wheat-research and seed production networks all across the nation with Fort Collins as its hub. Curtis said one reason for the selection was Colorado State University’s highly regarded wheat research program.

And while the region’s sugar beet growers also reported an above average year, that accomplishment was clouded by a court decision in August by a federal judge in California. He ruled that genetically modified beet seed developed by ag giant Monsanto to be immune to Monsanto’s Roundup herbicide could not be planted in 2011 pending further review by the U.S. Department of Agriculture of possible side effects.

The ruling left beet growers struggling to decide how it would affect their 2011 planting plans.