J.M. Smucker Consolidates, Closes Plants

The J.M. Smucker Co. says it will consolidate its Folgers Coffee production and close four plants, cutting 700 jobs.

NEW ORLEANS (AP) -- The Folgers Coffee Co. will consolidate all of its production into its two New Orleans plants and expand its Lacombe distribution center, creating 120 new jobs, under a state incentive plan announced Wednesday.

As part of the plan, Folgers' parent, The J.M. Smucker Co., said it will close its coffee plants in Sherman, Texas, and Kansas City, Mo.

Under the package announced by Gov. Bobby Jindal, Folgers also will retain 450 current jobs and invest $69 million in the expansion. Annual salaries will average about $42,000.

"This is a huge economic boost for the people of New Orleans and it marks the continued confidence that major companies are increasingly placing in our workforce and our business climate," Jindal said in a statement issued by his office.

The state economic development agency estimated that the expansion will generate $17.2 million in new state tax revenue and $4.9 million in new local tax revenue over the next 10 years, excluding corporate income taxes and property taxes.

The state said Folgers will get a performance-based incentive plan valued at about $5.6 million and will be able to qualify for state industrial tax credits. Failure to meet the investment and hiring goals would require the company to pay back the incentives.

Orrville, Ohio-based Smucker also said it would close its fruit-spread plants in Memphis, Tenn., and Ste. Marie, Quebec. The plant closures will end 700 jobs, or about 15 percent of Smucker's current workforce.

Smucker said it would spend $220 million over three years on a capital investment plan, including the Louisiana project, a new plant in Orrville and the upgrading of equipment and technology at its Ripon, Wis., plant. Fruit spreads, ice cream toppings, and syrups will be produced at the new Orrville plant.

Tim Smucker, board chairman and co-CEO of the company, said the consolidation is important for long-term growth. The company expects to save $60 million annually, excluding one-time costs, when the transition is fully complete.

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