Dive Brief:
- Tyson Foods will close four poultry plants in North Little Rock, Arkansas; Corydon, Indiana; Dexter, Missouri and Noel, Missouri, it said in a statement sent to Food Dive. The meat and poultry processor said it would not disclose how many jobs will be impacted.
- The closures are aimed at improving operational efficiency in its chicken business, and poultry processing will shift to other locations, Tyson said.
- The decision comes as the company reported a 3% decline in sales year-over-year and posted a loss of $350 million in its most recent quarter, according to its latest earnings report.
Dive Insight:
The closures signal continued difficulties as inflation curtails how much poultry, pork and beef consumers buy.
In a statement sent to Food Dive, Tyson CEO Donnie King said closing the plants demonstrates the company’s “commitment to bold action and operational excellence as we drive performance, including lower costs and improving capacity utilization, and build on our strategy of making Tyson Foods stronger in the long-term.”
While King touted growth in volumes compared to the company’s competitors, he said current market dynamics have proven to be a challenge to the meat and poultry giant.
John R. Tyson, the company’s CFO, declined to say whether more plant closures are possible in an interview with Reuters.
Operating costs continue to weigh on Tyson’s bottom line, the company said in the earnings report, as higher feed ingredient costs and a tight supply of cattle spur problems for its beef segment.
In response to market headwinds, the company’s product pricing varied in the last quarter. Beef prices increased 5.2%, while poultry and pork decreased 5.5% and 16.4%, respectively. Volumes during the quarter fell 5.3% for beef and 1.8% for pork, while rising 2.8% for poultry.
The plant closures are the latest from the company this year designed to improve its financial situation.
In March, the company announced the closure of two chicken processing plants — in Glen Allen, Virginia and in Van Buren, Arkansas — which led to the loss of 1,700 workers. A month later, Tyson laid off 10% of its corporate workforce, including 15% of senior leadership positions.
