Smithfield Foods shuts down sow farms amid declining profits

USA –  Smithfield Foods, one of the world’s leading pork processors, has announced its plan to permanently shut down its 35 hog farm sites in Missouri amid declining profits and reduced consumer demands squeezed by inflation and higher interest rates.

According to a notice from the Missouri Worker Adjustment and Retraining Notification Act (WARN), the site’s closure will lead to the laying off of 92 employees in October.

“The decision to close these sow farms was made in May and it was in response to challenging market conditions. This decision was widely reported after we notified our employees,” a spokesman from the company noted.

“All impacted employees are receiving transition assistance, including the option to move into other positions with the company, said the representative.”

According to a report from the pork processor, the 35 hog farm sites set to cease operations include 13 sites in Newtown, Missouri, 12 in Lucerne, Missouri and 10 in Princeton, Missouri.

This follows a recent announcement from a global meat processor, Tyson Foods, to shut down its four poultry plants in the US due to declining demand, market conditions, and higher feed costs.

According to Tyson Foods, the company expects to shift production to other facilities and cease operations at the impacted locations in the first two quarters of fiscal 2024.

“The difficult decision to close four chicken facilities in North Little Rock, Arkansas, Corydon, Indiana, Dexter, Missouri and Noel, Missouri demonstrates our commitment to bold action and operational excellence as we drive performance,” Donnie King CEO, of Tyson Foods said.

Danish crowns reveals multidisciplinary plan to boost earnings value

Meanwhile, Danish Crown, a beef and pork processor, has unveiled a detailed cost-savings plan designed to deliver an improvement in operational performance within two years.

The  Denmark-headquartered meat processor is aiming to boost its earnings in the forecast period by at least US$219.4 million through a multiple-faceted initiative, including improving efficiencies in its facilities through technology to cut production costs.

Danish Crown has already been consolidating its network of abattoirs and deboning operations in Denmark and Germany, complete with the loss of jobs, due to a decline in pigs coming in for slaughter from the cooperative’s farmers.

 At the same time, the company revealed a plan to invest in automation in December to boost its competitiveness

“Settlement prices for pigs in Denmark are currently far below those of the rest of Europe. Even though current prices for pigs are close to a record high, Danish Crown’s settlement prices are far below the European average and prices in Germany,” the company said.

“Consequently, it has not been sufficiently attractive for Danish farmers to fatten pigs for slaughter in Denmark, so throughout the summer period management has dedicated its efforts to drawing up a plan to simplify and rethink Danish Crown’s core business.”

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