Rebuilt after a disastrous fire, AMPI plant is better than ever.

Time to put to rest one of dairy’s urban legends: There were no rivers of melted butter flowing out of the butter factory in New Ulm, Minn., after it caught fire on the evening of December 1, 2004.

“Some did get out to the road, but very little,” says plant manager Bill Swan, noting that butter was knee-deep in some areas of the plant. Melted butter floating atop the large quantity of water used to put out the fire, he says, helped fuel the exaggeration.

A little over two years later, Associated Milk Producers Inc.’s hometown plant is in the best shape it’s been in since the former Five Star Dairy Cooperative churning and packaging facility was folded into AMPI in 1969. Products made here are primarily packaged for private labels, but some are sold under AMPI’s own State Brand label.

“This is our only butter plant, which is why, when it was down, there was such a ripple effect,” says Sheryl Meshke, AMPI communications and government relations director.

Fortunately, it was near the end of peak butter season, with the holiday rush nearly over, Swan notes. “AMPI was immediately offered help from other butter manufacturers, enabling us to take care of our customers,” he recalls. “We were getting into the slower season anyway, so that really went pretty well.”

Meanwhile, the management teams at AMPI’s New Ulm corporate office started to assess the damage. “We were basically digging out the plant and trying to decide which pieces of equipment could be salvaged by our in-house personnel — we have a very talented maintenance group; all of our employees, really — and look for nooks and crannies where we could start putting equipment,” Swan says. “Our first production lines to come on were our continentals. We started production on December 23 [2004] with two continental machines.”

Work continued into the new year. “We disassembled the machines, cleaned them and refurbished all the damaged parts. Then we moved them from where they were in the butter production plant up to our milk plant that was unaffected by the fire; we put machines in right underneath the office here,” Swan recounts. “As time went on, more butter packaging machines were salvaged and put into operation. We actually had seven production lines running in the milk plant inside the first six weeks.”

In January 2005, AMPI announced its decision to rebuild the butter plant. On one side of the plant’s firewall, the building was completely destroyed. “On the other side, there was smoke damage but it could be rehabilitated. So, while we had a group of employees working up here on continental and butter cup production, we had another group that was down on the other side of the firewall refurbishing, cleaning, remodeling,” he says. “We ended up having five of our bigger production lines set up in a [refurbished] room down in the butter plant to satisfy our customers. At that point, we were at around 80 percent of our pre-fire capacity. We began production in the butter plant around March 20 and basically ramped up through the summer of 2005.”

Thorough cleanup was crucial, he notes; since butter very easily absorbs odors, a near-sterile environment was necessary.

Construction began right in the center of the complex. “We basically demolished everything down to the foundation and rebuilt that section of the plant from scratch,” Swan says. By December 2005, a year after the fire, warehousing and shipping operations were finally moved back into the plant after spending a year at an off-site rented location.

“On December 15 we brought our shipping crews back; we had our coolers and refrigeration systems operational. Then we started servicing customers directly from here,” Swan says. “In late January of ’06 we started churning from cream again, and basically spent the first quarter of 2006 moving equipment from its temporary locations to their final homes in the new building.”

Often a disaster can open up new possibilities for improvements. The New Ulm plant already had many cutting-edge technologies before the fire, so things that worked well were duplicated. “We looked at everything,” Swan says. “Things that didn’t work, we went another route.”

Most of the enhancements were put into the plant’s infrastructure. Immediately noticeable is that the main processing room was rebuilt as a single room, instead of the many smaller rooms that comprised the pre-fire plant. This configuration greatly enhances production flow and communication on the shop floor.

“If you were here a year ago, you could see Center Street,” Swan says. “This was just a flat slab.”

The room is essentially maintenance free in its construction. All surfaces are made of stainless steel, glazed block or tile, with virtually no painted surfaces. “Even the sprinkler heads are non-corrosive,” Swan says, noting that all areas of the plant have fire sprinklers installed.

The ammonia refrigeration building became an enclosed room completely inaccessible from the plant’s interior. It has a state-of-the-art ammonia plant with internal and external computer controls. The compressed air plant is enclosed in its own room. The new variable-load compressors are more energy efficient than the old units; their waste heat is used to heat the main processing plant.

“Anywhere there’s not something directly related to production, those rooms are segregated,” Swan explains. “If any event were to take place in those rooms, only one small area would be affected.”

The CIP systems and the processing rooms are computer controlled from numerous terminals in the plant. The overhead piping is welded as one piece so there are no gaskets to wear out or replace. The CIP system also is capable of cleaning several circuits at once. Processing lines are hot-water jacketed to ease the removal of butter before beginning the sanitation process.

All waste butter is recovered for further processing instead of becoming part of the plant wastewater. “It lowers our wastewater bill and we have a product that’s salvageable,” Swan says.

The electrical wiring in the plant allowed all pumps and valves to be networked under computer process control so the various systems work together. Further, the plant has a digital security system that enhances customer confidence and allows easy troubleshooting of problems.

And, of course, there’s some new packaging equipment that operates faster and gives a better overall product appearance, including a new 1-pound solids machine. Meanwhile, the quarters and solids line was stripped down and rebuilt on site; rebuilding of the butter cup machines was outsourced. A new automatic case packer has helped double pre-fire capacity of whipped buckets.

Robotic palletizing, in use before the fire, is expected to return this summer, Swan says.

Full production of some 200 SKUs per month was reached in the rebuilt plant last August. “One of the biggest challenges we’ve had is running at full production and doing all the maintenance at the same time,” Swan says.

The two original coolers destroyed by the fire have been replaced by a single facility. A new flow-through rack system “allows us to maximize the queue so we can have several different products in a row instead of just one item,” Swan says.

Refrigeration units are now on the roof instead of in the building, out of the way of potential damage during plant movements. During construction, while the refrigeration system was down, the plant used fans to pull in outside winter air to chill bulk butter. This innovation worked so well, Swan says his team plans to use this system permanently.

As manufacturing and production charge ahead full blast, AMPI is still waiting for an official declaration of the cause of the fire, which is believed to have started in the plant’s air compressor area.

What has Swan taken away from the experience?

“Not to underestimate the dedication of your employees,” he says. “I can’t say enough about the people who work at this plant. They came back to work dressed in clean clothes and at the end of a 12-hour shift came out looking like they came out of a coal mine. They scrubbed and cleaned for months and months to get this plant back up on its feet.”

And while AMPI’s 13 plants basically operate independently within the company,  “AMPI as an organization really came together to make the rebuild a success,” Swan says. “We were able to use a lot of resources from the corporate office, which is one of the benefits of being here in New Ulm. Basically we were able to pull all the extra resources that you don’t normally carry in a plant and have them handy, and they pitched in and did a great job.”

Ultimately it was all focused on the customers. “We certainly bent over backwards to make sure they were served,” Swan says. “They all recognized that and told us, ‘When you guys are ready and back on your feet, let us know and we’ll be back.’ That speaks very well for the service we provide our customers.”

Location: New Ulm, Minn.

Year opened: 1965

Size: 100,000 square feet.

Employees: 160

Products made: Butter cups (whipped and non-whipped), continental chips, 1/2- and 1-pound quarter-stick packages, four-pack club quarters, 1-pound solids, varieties of soft chips, whipped 8- ounce and 5-pound plastic tubs, 1-pound plastic tubs and 25-kilogram bulk. Made from cream delivered by AMPI member producers.

Capacity: 100 million pounds annually.

Processing: Three churns, two micro fixes.

Packaging: 18 lines.

Storage: 50,000 gallons raw milk; 200,000 gallons cream; cooler, 26,000 square feet.