PERHAM, Minn. — Every day that Bongards staff go to work, they are thinking up ways to add value to their dairy products that can, in turn, put more money in the pockets of dairy farmers.
When the farmer-owned cooperative bought the milk processing plant in Perham in 2003, it was not in operation. They began major capital improvements in 2012 that have never really slowed down, as construction is expected to continue into 2026 and likely continue as new technology and efficiency come along. They are now at their peak of production.
In 2012, they were at about 1.5 million pounds of milk processed each day. By 2014, around 2 million. They surpassed 3 million pounds per day in 2015, 4.2 million pounds in 2018, and are at about 5.3 million pounds a day in 2025. There are 8.6 pounds in a gallon of milk.
Daryl Larson, president and CEO of Bongards in Perham, has been in his position since 2018, and has been in the cheese industry for 50 years. He’s proud of the efficiencies that have helped move this plant into peak performance.
“And all the construction was done without a single down day,” Larson said. “We had to because we have one plant, and if we decide to take a down day, where does that milk go?”
The milk comes from about 155 direct members of Bongards cooperative and about 100 dairy farmers that belong to other cooperatives that also feed into the supply. All that milk has little to no where else to go.
It’s been rare not to see two cranes busily moving massive pieces of this facility into place across the skyline of this small town of 3,700 in recent years. What allows Bongards to expand and pay out higher prices for milk is a focus on efficiencies.
“The more efficient we get, the more we make on processing farmers' milk, the more we can pay for milk,” Larson said.
It’s a simple enough equation that requires extensive work to market their products worldwide and stay on top of efficient processes.
$125 million project
Perhaps the most significant project that has increased efficiency and capacity is a $125 million expansion, started in 2023, that is now nearly complete.
It included an increase from four to seven milk bays, new cheese packaging equipment, new whey drying and packaging equipment, whey warehousing, and expanded wastewater treatment. Larson proudly explained how the project allowed them to increase the amount of milk processed daily by 30%, while only increasing labor by about 15%. They are now at about 174 staff in Perham.
Those staff will soon have access to a new staff entry point, which will include a larger break area and also act as a separation point where staff switch out of their non-work attire and put on their necessary coverings to keep the plant biosecure. This area is being constructed out of the previous office building.
Another project that’s expected to be completed in May is the refurbished deproteinized whey dryer that was built in the 1970s. Its reconstruction will make it twice as efficient as the previous one.
A new whey dryer started up this summer. Stepping into the room where this behemoth does its work is jaw-dropping. The sheer size and shape of the massive stainless steel structure make you feel as if a spaceship has landed on the peak of the structure and reaches down through four floors. Out of its base flows about 20,000 pounds of powder an hour.
The room is a warm one, and much of that warmth is recovered to be continuously used in the efficient evaporation process.
“We’re basically doing our 5.5 million pounds of milk with the same energy it took to do 4.2 (million pounds),” Daryl Larson said. That’s because of an advanced heat recovery dryer system and the new evaporator.
As it steadily heats and shakes, the whey powder works its way down and eventually flows into a packaging area where robotics fill 25 kg bags and precisely stack them on pallets.
“So it’s a good time to finish an expansion and be putting out the most product that you’ve ever put out,” Larson said.
Producing their highest amount of whey protein powder at a time when demand for the product is also at a high is paying dividends for the cooperative.
But not to be forgotten is the cheese that has always been a key part of business in Perham. To put all this milk processing in perspective, the newest expansion includes 10 cheese vats that each hold 70,000 pounds of milk. And a relatively new 70,000-square-foot cheese cooler holds somewhere around 13 million pounds of cheese for about as far as you can see, including 500-pound barrels of cheese and 40-pound blocks of cheese.
About 20% of production is 40-pound blocks. That’s more of a ready-to-eat product. The other 80% is turned into 500-pound barrels, which are delivered and further processed for customer needs.
You get about 11 pounds of cheese per 100-weight of milk. What’s left becomes whey. That can be deproteinized whey, sold for animal feed or whey protein concentrate, often used by people looking to add protein to their diets.
“There’s really not much waste that comes out of a cheese plant, minus cleaning equipment,” said Justin Larson, director of operations for natural cheese at Bongards, and the son of Daryl. Water that’s removed from the milk goes back into cleaning equipment.
The father and son walked through the new facility in October, pointing out the cutting-edge technology installed into this system.
As they are at or near peak capacity, they also had to increase the capacity of milk intake and truck bays for sending out the finished products. As the plant operates around the clock, intake and delivery are also always flowing. Being able to meet demand with this expansion project was not by accident.
“We had all the cheese and whey product sold before we ever turned a shovel to start the project,” Daryl Larson said. “We knew we could sell the cheese, we knew we could sell the whey.”
The Perham plant has expanded about as far as they can in the middle of this lakes area town. To go any larger would take an expanded wastewater treatment system and a second cheese plant.
“You know, 5.5 (million pounds of milk) is as much as we can get through those cheese belts,” Larson said. He calls it an ample size for up to 6 million pounds of milk per day.
Being at capacity means Bongards does not have current plans to accept more milk. That dispels rumors that Bongards plans to take the milk from the two planned Riverview Dairy herds that are expected to add 37,500 cows to North Dakota’s current herd of about 15,000.
“We’re full. We cannot take any more milk at the present time,” Daryl Larson said. “So the North Dakota milk is going to be going somewhere else.”
Bongards does currently take some milk from North Dakota and some from Riverview Dairy.
Over the last year, the expansion has allowed Bongards to add nine dairies from central Minnesota and into North Dakota.
“We’ve got a waiting list of people that would like to ship milk to us,” Daryl Larson said.
Looking to the future
Seeing these major projects come to fruition has been gratifying work for Daryl Larson, who is set to retire at the end of 2025. Dennis Thomas has been appointed to his role effective Jan. 1, 2026.
“I never was unemployed in my entire career,” Larson said. “So, 50 years of running around cheese plants is enough, I think.”
He commends the staff at Perham who have been dealing with doing their jobs with near constant construction projects for the last decade, often changing their work area and how they do their job.
“The team up here in Perham has been marvelous,” he said. “They just stick with it. You know they are very motivated to do the best they can.”
Bongards resurrected the milk plant in Perham after it was closed in 2001 and around 60 employees lost their jobs.
He expects the efficiencies to continue, something co-op members should also be proud of as it will continue to process their milk for years to come.
Bongards history goes back to 1908, when the company formed its first farmer-owned co-operative creamery in Bongards, Minnesota.
There are Bongards plants in Perham and Bongards, Minnesota, and one in Humboldt, Tennessee. The Perham plant is the only one that processes raw milk. They also have retail stores in Perham and Bongards. The corporate office is in Chanhassen, Minnesota.