A growing global appetite for french fries is driving ConAgra Foods Inc. to spend $200 million on a second french fry processing line at its Lamb Weston manufacturing campus in Richland.
ConAgra announced its plans Tuesday. When open, the new line will employ 128 in addition to the 500 who work at the existing french fry plant and 70 who work in Lamb Weston’s product development office.
It is the largest private investment in the Tri-Cities for 2016 to date, easily eclipsing the $39 million AutoZone warehouse center under construction near Pasco’s King City truck stop.
The new french fry line is under construction at 2013 Saint St., next to Lamb Weston’s existing french fry plant and only a few miles from the largest commercial freezer in North America, Preferred Freezer Services’ 455,000-square-foot facility near the Horn Rapids Industrial Park. The $115 million freezer opened in 2014 and provides warehouse and distribution services to the frozen food industry, including easy access to both trucking and rail lines.
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ConAgra said growing worldwide demand for french fries is behind the massive investment. Demand is expected to grow by 2.6 billion pounds by 2020, according to Euromonitor data cited by ConAgra.
“We have a tremendous opportunity to help our customers realize their global growth projections, but we need to make more french fries to do that,” said Greg Schlafer, president of Lamb Weston, in a statement.
Brian Bonlender, director of the Washington State Department said the new french fry line is a welcome investment in food processing, a key sector.
“This is very exciting and a positive development not only for the Tri-Cities community, but for the state,” he said. The state is providing $250,000 award from the Governor’s Strategic Reserve Fund. The Tri-City Development Council or TRIDEC is providing an additional $250,000.
Bonlender confirmed the project may qualify for a deferral of 6.5 percent state sales tax if the area’s unemployment rate is deemed “distressed”. The exemption would be worth up to $13 million but would not apply to the 2.1 percent local sales tax. That makes construction alone worth $4.2 million in sales tax revenue to local jurisdictions.
The strategic reserve allocation will reimburse Lamb Weston for a portion of the costs associated with the wastewater treatment system and a traffic impact study.
Lamb Weston will held the region attract more advanced food processing, he added.
“Like attracts like. These are facilities that require a specialized workforce. It helps us build that workforce. That helps us when it comes to recruiting the next similar type of business.”
The investment in LambWeston comes just months before it is slated to become an independent, publicly-traded company. In November, ConAgra (NYSE: CAG) announced it would spin off its frozen potato subsidiary in fall 2016.
A ConAgra spokeswoman said that process is continuing.