While Kraft Heinz is closing several plants across the country, the food giant is investing more than $100 million in Minnesota, expanding its New Ulm plant to churn out a lot more Velveeta.
The expansion is expected to add 50 jobs at the plant, which already employs nearly 400. Plus, about 90 Kraft jobs will be saved because of the expansion, said Brian Tohal, coordinator of the nonprofit New Ulm Economic Development Corp.
He said those 90 jobs would have been shed because Kraft Heinz recently lost a large contract. But with the expansion, Kraft will add production.
Tohal called the expansion "huge" news for New Ulm, a city of 13,500 about 75 miles southwest of Minneapolis. With Kraft Heinz in the midst of big cost reductions, the city thought its plant might be on the chopping block, too, Tohal said.
"There was some nervousness in the community," he said.
The New Ulm plant processes cheese for Kraft Deli Deluxe slices and for other products, including "Handi Snacks" — concoctions of crackers and cheese. With the expansion, the plant will again be churning out retail Velveeta, Kraft's famous processed cheese.
In 2012, Kraft moved production of Velveeta to a plant in Illinois, though it still makes bulk Velveeta in New Ulm. The loss of the retail Velveeta line and a multimillion-dollar automation project led to major job cuts at the New Ulm plant, Tohal said. The plant had employed about 550 workers in 2012.
Kraft Heinz, based in Chicago and Pittsburgh, also employs nearly 100 at a cheese ingredient plant in Albany, Minn., near St. Cloud.
