Wal-Mart Supercenter
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Walmart announced plans to build and operate its own dairy processing plant. The goal is to supply its own line of milk to hundreds of stores in 2017.

Walmart's dairy processing plant will be built in Indiana. The company plans on supplying around 600 Walmart and Sam's Club stores in Illinois, Indiana, Ohio, Michigan and Northern Kentucky with Walmart-brand milk.

Tony Airoso, senior vice president of sourcing strategy for Walmart U.S., issued a statement saying the company will be able to reduce operating costs and pass the savings onto customers. This is because the store will be operating its own plan and will work directly with the dairy supply chain in the Midwest.

The move is going to take about a year to complete, and other milk producers may be impacted by it. However, one of the country's largest milk producers, Dean Foods, said Walmart's move won't hurt its sales.

According to Wane, one farmer said the only problem he'd have with Walmart's processing plant is if it receives tax breaks that smaller dairy farmers don't receive. Mark Grieshop, who owns Pasture's Delight, said he has no issue with the plant being built, as long as it's a level playing field.

Indiana is rank 14 in the nation in the production of milk, as well as ranked 2 in ice cream production. The state is also home to 21 dairy processing plants and more than 10 farmstead operations.