New Asian food production plant secures Sioux Falls’ place in a growing market

KELOLAND.com Original

SIOUX FALLS, S.D. (KELO) — A planned plant in Sioux Falls will help feed America’s growing appetite for Asian foods.

Asian-inspired food is one the country’s fastest growing categories of food, according to Supermarket Perimiter and IFT on foods websites.

Schwan’s Food Company and CJ Foods, both owned by CJ CheilJedang (CJCJ) of South Korea plan to build a 700,000 square foot facility to manufacture Asian frozen food and shelf stable products on 140 acres in Foundation Park in Sioux Falls. The plan includes the manufacturing plant, a warehouse and related facilities. The plant would need 600 workers by 2025, a news release said.

Most of those 600 jobs would be high-tech jobs, said Bob Mundt, the president and chief executive officer of the Sioux Falls Development Foundation.

Sioux Falls Mayor Paul TenHaken describes the jobs as high-tech, well- paying jobs in a cutting edge facility.

Finding 600 workers to make frozen eggs rolls and similar cuisine could be a challenge in a state and region where the unemployment rate consistently hovers around 3% outside of any coronavirus pandemic.

(CJ Foods and Schwan’s) “are very well aware of our workforce. They did an analysis…and they are confident they can get the workers they need,” Mundt said.

Mundt said Schwan’s and CJ Foods has been talking with area technical colleges and universities about workforce needs.

The plant would join Amazon’s planned 1,000 workers at a new 640,000 square-foot distribution center.

TenHaken said the workforce can be a challenge in an area with a low unemployment rate. It’s a big reason why the city continues to work on projects that make the city an attractive place to live so that the workforce can grow.

While CJ Foods and Schwan’s are under the umbrella of CJCJ, folks in South Dakota are likely more familiar with the Schwan’s name as its corporate offices are in Marshall, Minnesota, and Bloomington, Minnesota.

Schwan’s makes Red Baron and Tony’s Pizza but it also has a line of Asian frozen foods such as Pagoda egg rolls. The company website said it ranks second in the U.S. frozen pizza market and first in the U.S. for frozen pies and in Asian snacks and appetizers. CJ Foods also manufactures Asian frozen foods such as Annie Chun’s.

CJ Foods, Inc. is the U.S. food operations headquarters for CJ Cheiljedang.

Sioux Falls was chosen from several other sites that had been considered, Mundt said.

Schwan’s/CJ Foods’ decision to build a plant in Foundation Park is because, in part, of a consultant who made them aware of the Sioux Falls industrial park, Mundt said.

Since Schwan’s has a presence in Marshall, about 91miles from Sioux Falls, it’s likely familiar with the area, Mundt said.

The proposed plant would be located in the section of Foundation Park already designated as a Tax Increment Financing District by the city of Sioux Falls.

“(The TIF portion) would have no direct impact on Schwan’s or CJ Foods,” Mundt said.

The TIF is a tax benefit for the foundation, which allows it to take any new increases in taxes from development to be applied to the costs of installing roads and other infrastructure. The TIF was established to prepare for any potential industry that may want a Sioux Falls location, Mundt said in a Sept. 17 KELOLAND.Com Original story.

Schwan’s/CJ Foods would own the 140 acres but the purchase has not yet been finalized, Mundt said. Mundt said the foundation does not disclose the terms of purchase agreements. Nor does the foundation disclose any programs or tools it may use to help a company build or expand in Sioux Falls, he said.

“No incentives for CJ Foods have not been finalized. However, upon finalization between all parties, public information will be posted on open records. To that end, we do not have an additional dollar amounts we can provide today. Finally, we’ve always had a progressive relationship with our tech schools, universities and private sector. As we continue to work with CJ Foods, we’re confident that our outstanding educational facilities will provide workforce necessary to ensure CJ Foods success in South Dakota,” said GOED Commissioner Steve Westra.

Mundt said the estimated investment in Sioux Falls is about $500 million at this point.

The plant would be one of eight CJ Foods and Schwan’s Asian food plants in the U.S., according to a news release shared by the state. CJ Foods has five plants in California, Ohio, New York and New Jersey and Schwan’s Company has two in Texas.

The plant would make meals, appetizers and snacks.

Monday’s announcement comes after more than a year of discussion with Schwan’s/CJ Foods, Mundt said.

Although a groundbreaking is planned for this spring, final designs and permits must still be completed before construction starts.

Mundt said while there are several steps that need to be done before construction starts, the foundation is confident the plan and process are sound.

“This gives the ability to move forward…,” Mundt said.

Although South Dakota residents may be familiar with the Schwan’s name, the Schwan’s Food Company associated with the new plant does not include Schwan’s Home Service, which is the home delivery of frozen food products. When CJ Cheiljedang bought Schwan’s in 2019, the Schwan family retained the ownership of the Schwan’s Home Delivery company.

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