Pilgrim's Pride Co. has announced it will close a chicken-processing complex that employs 830 people in Siler City, N.C. The company will also close six of its 13 U.S. distribution centers.
Citing soaring chicken feed costs resulting from corn-based ethanol production, including "record-high prices for corn, soybean meal and other feed ingredients," a company press release said the closings were part of a plan to diminish losses related to feed costs. All told, the company will eliminate 1,100 jobs.
"Our company and industry are struggling to cope with unprecedented increases in feed-ingredient costs this year due largely to the U.S. government's ill-advised policy of providing generous federal subsidies to corn-based ethanol blenders," said Clint Rivers, president and chief executive officer. "The cost burden is already enormous, and it's growing even larger. Based on current commodity futures markets, our company's total costs for corn and soybean meal to feed our flocks in fiscal 2008 would be more than $1.3 billion higher than what they were two years ago. We simply must find ways to pass along these higher costs."
The distribution centers to be closed are in Oskaloosa, Iowa; Plant City and Pompano Beach, Fla.; Jackson, Miss.; Nashville, Tenn.; and Cincinnati, Ohio.
The company said it will assist laid-off employees find new jobs and file for benefits such as unemployment. It also said that when the industry situation improves, "portions of the live production capabilities associated with the Siler City operation may be redeployed to supply other company facilities in that region of the country."
For the full press release visit phx.corporate-ir.net/phoenix.zhtml?c=68228&p=irol-newsArticle&ID=1117942&highlight