The cooperative said it will no longer create cream cheese and Neufchatel products, which were created solely by the Los Banos facility.
The company said it will continue to operate its five other manufacturing facilities and no other product segments will be affected.
CEO Andrei Mikhalevsky said the Los Banos plant has a long history that has served CDI and its members well.
“Unfortunately, the declining volume of milk in California is affecting the entire dairy industry, and CDI is not immune,” Mikhalevsky said.
“These reduced milk volumes, combined with the high cost of operating our Los Banos facility, are the sole drivers behind the decision.
“This decision is in no way a reflection on the hard work of our talented employees in Los Banos or the high-quality products they have produced.”
Working with staff and companies
CDI said it will work closely with impacted employees to assist them and their families with this transition.
The company added it will also work with existing customers to enable a smooth transition in the areas of finished goods supply, packaging inventories and, where feasible, forward pack of finished goods.
The Los Banos manufacturing facility has been in operation since 1925, where it was first operated as part of San Joaquin Valley Dairymen, before merging with Danish Creamery and California Milk Producers in 1999 to become California Dairies, Inc.
CDI is the largest member-owned milk marketing and processing cooperative in California, producing 43% of the state’s milk.
Co-owned by more than 420 dairy producers who ship 17bn pounds of milk annually, CDI manufactures butter, fluid milk products and milk powders.