August 1, 2011
Pilgrim's Pride to shut down Dallas facility
JBS USA unit Pilgrim's Pride has announced the closure of its chicken-processing plant in Dallas by September 30 due to financial strains in the poultry industry.
Pilgrim's Pride President and CEO Bill Lovette said, "While the decision to close a plant and eliminate jobs is always painful, we must make better use of our assets given the challenges facing our industry from record-high feed costs and an oversupply of chicken.
A key component of that effort is improving our capacity utilisation through production consolidation and other operational changes. By closing the Dallas facility, we can consolidate that production volume at three other plants and help those sites run closer to full capacity. In addition, we will eliminate the cost associated with transporting live birds from northeast Texas to the Dallas processing plant and shipping offal from Dallas back to our protein conversion plant in Mt. Pleasant.
This will significantly reduce our costs and allow us to operate more efficiently. In addition, we believe it will go a long way toward helping position Pilgrim's to emerge from the current industry down-cycle as a leaner, more competitive company."
The company plans to raise the live weights in two of the three plants where Dallas production will be moved. As a result, growers are not expected to be impacted.
"We're simply going to grow larger birds in houses for two of those plants and then shift production to another complex in that area as well," Lovette said.
Pilgrim's contract growers who supply birds to the Dallas plant will begin supplying the other company plants following the consolidation. The company said there would be no disruption in supply of product to Pilgrim's customers.
Other live production operations in Northeast Texas will continue to function. Lovette said there are no plans to close any other processing facilities at this time.
Pilgrim's Pride expects to be able to offer positions at other facilities to interested employees.
