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Based in part on the local foods movement and on concerns about shipping costs and carbon footprints, many food processors are looking to source locally or regionally. Milk-based value-added product processors currently in Tennessee (for example, ice cream manufacturers) might consider sourcing from a possible, new, in-state milk plant. Based on farmer survey data, dairy costs of production for Tennessee as reported by the U.S. Department of Agriculture, and discussions with industry experts, an IMPLAN-based, hybrid input-output model is constructed with a focus on Tennessee milk production and processing. This model is used to draw inferences concerning the possible economic impact of a new milk plant on the state economy.


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