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Dean Faces New Challenge as Wal-Mart Gets Into Milk Business

  • Wal-Mart plans Indiana factory to cut private-label costs
  • Dean says it may lose 100 million gallons of sales volume
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Dean Foods Co., the largest U.S. milk processor, faces competition from an unexpected source: its biggest customer.

Wal-Mart Stores Inc., which last year accounted for 16 percent of Dean’s sales, plans to start building its first milk-processing plant this summer. The Indiana facility is expected to be one of the largest in the milk industry and will begin supplying the retailer’s private label Great Value brand next year in-state as well as to stores in Illinois, Michigan, Ohio and northern Kentucky.