Basic American Foods announced it will close its Shelley production facility, laying off 65 people in a move to consolidate those operations into its Blackfoot and Rexburg locations.

The Walnut Creek, Calif.-based company said in a release Monday that the slowing economy and the high cost of Idaho potatoes has led BAF to increase efficiencies. The company expects the change to become effective in February.

"Consolidating our Idaho operations and reducing costs is necessary for American Basic Foods to continue competing in national markets," said Todd Peretti, the company's vice president of operations, in the release.

BAF said it is offering employees a severance package and coordinating with local services to aid those losing their jobs to find new employment.