Meadow Gold Dairies is seeking a large-scale expansion of its Hilo processing plant.
A draft environmental assessment prepared by the Honolulu consulting firm PBR Hawaii &Associates anticipates a finding of no significant impact to the environment if the project goes forward.
According to the document, Meadow Gold — which occupies 1.42 acres of state land in at the corner of Railroad Avenue and Leilani Street — plans to expand onto 35.18 acres of adjacent state land in the Kanoelehua Industrial Area.
Bahman Sadeghi, a former Big Island dairy farmer who acquired the Meadow Gold brand and most of its assets in April 2020, said the acreage in the EA is misleading “because our expansion impacts our neighbors” — which are the county Parks and Recreation Hilo base yard and James W. Glover Ltd., a construction contracting firm.
“Our actual expansion is 1.6 acres, but because it touches upon the adjacent lots, the EA was done on the 35,” Sadeghi said Friday. Sadeghi said the expansion would be “basically, doubling our size.”
The expansion plan also would provide a roadway lot that would allow Leilani Street to be extended.
According to Sadeghi, the expansion of the plant will allow Meadow Gold to broaden its product line as well as process a larger amount of milk and other products.
“We’re running practically 24/7 … fulfilling, as much as we can, the state’s requirement (of dairy products) — all out of Hilo,” Sadeghi said. “So, we really are busting at the seams, so to speak.”
Sadeghi said the facility in the Kanoelehua Industrial Area processes about 200,000 gallons of milk a month, with about 10%, or 20,000 gallons coming from Cloverleaf Dairy in Hawi, the only Hawaii dairy producing milk for commercial processing and retail sale.
He said the expansion of the plant would “bring back the culture” that existed prior to the shuttering of Meadow Gold’s Oahu processing facility.
Sadeghi said Meadow Gold also is planning to offer plant-based lines, such as soy, almond and macadamia-nut based beverages that the company hopes to roll out in the near future.
He said the Hilo plant currently is making ice cream mixes — although not the finished product — and other products “such as buttermilk, half-and-half and heavy whipping cream,” in addition to milk.
“We’ll definitely need more personnel … with the expansion and additional lines,” Sadeghi added, and said the company probably will hire “15 to 20 additional personnel” to accomplish the expansion. He said there are “around 30” people working at the Hilo facility at this time.
According to the draft document, the construction would take about six months at a cost of approximately $3 million. Meadow Gold plans to start construction “immediately upon receipt of necessary land use approvals and construction permits,” the draft EA states.
Sadeghi said the $3 million estimate is “just purely structural — and that’s only phase one” of the expansion.
“Equipment alone, you could (invest) $5 million or $6 million alone in just various equipment,” he said. “We plan to expand the cooler area … as well as expand our equipment utility area, basically the infrastructure of the plant.
“Phase two will be additional warehouses, possibly an additional cooler — and a maintenance shop for our fleet” of vehicles, Sadeghi added.
The release of the draft EA on Nov. 23 was followed a day later by a federal lawsuit filed by food distributor Hawaii Foodservice Alliance against Meadow Gold, accusing the company of misleading packaging and false advertising, with milk produced in California sold in containers labeled “Hawaii’s Dairy” and “Made With Aloha.”
A statement put out by Meadow Gold in response to the suit said the company has “never claimed that all our milk is local, but we do consider ourselves Hawaii’s Dairy because we are committed to Hawaii and its community and will continue to be while we work toward building a more sustainable operation.”
It further said “everything we do is with aloha,” and aloha “is part of our company culture.”
“For over 120 years, Meadow Gold has provided milk, ice cream and juices for Hawaii families,” Sadeghi said. “We’re proud that we’re locally owned and operated — and continue to produce Meadow Gold products. And we’re currently building a blueprint for shared prosperity through expanding local sustainable ag.”
Steve and Derek Whitesides sold the assets of the shuttered Big Island Dairy in Ookala — which was once owned by Sadeghi — to Chad and Stephanie Buck of Oahu earlier this year. The Bucks own Hawaii Foodservice Alliance, the entity suing Meadow Gold. They reportedly are planning their own dairy operation on the leased state land.
But with Big Island Dairy no longer producing milk, and Cloverleaf the last dairy commercially producing cows’ milk in the state, the question remains: Can there be a profitable, nonboutique commercial dairy operation in Hawaii?
“Absolutely,” Sadeghi replied. “If I didn’t believe that, I wouldn’t have stepped in to save Meadow Gold. I am a dairy farmer, and I know that side of the business well. But there is a key to this: You have to produce local feed. You can’t bring in mainland feed and convert that to milk. That model went away in the late ’80s, early ’90s when freight (prices) continued to escalate.
“So, if you grow local feed, you can have a sustainable local dairy industry.”
The public review and comment period on the draft EA document ends Dec. 23. The draft EA is available online at https://bit.ly/3rsrQtf.
Email John Burnett at jburnett at hawaiitribune-herald.com.