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Hastings pork processing plant to close in July with loss of 370 jobs
By Robert Pore
robert.pore@theindependent.com
HASTINGS — The Armour-Eckrich Meats plant in Hastings, which employs about 370 people, will close in July as part of a restructuring plan by Smithfield Foods.
The Hastings plant produces packaged meats for retail, deli and food service customers.
Smithfield announced the plan on Tuesday.
Company officials said the plan will streamline the manufacturing operations of Smithfield’s pork group from seven to three companies. They expect the restructuring to save the company approximately $55 million in fiscal year 2010 and $125 million by fiscal year 2011.
Along with the Hastings plant, Smithfield plans to close six of its pork processing plants, cutting 1,800 jobs.
Along with Hastings, the company said the plants that will close by December are in Smithfield, Va.; Plant City, Fla.; Elton, N.C.; Great Bend, Kan.; and New Riegel, Ohio.
Armour-Eckrich Meats employs 3,100 employees in 13 states. The company has nine processing plants and five sales and marketing offices. Smithfield purchased Armour-Eckrich in 2006 from ConAgra Foods.
Along with the Hastings plant, Smithfield also owns the pork processing plant in Crete that employs approximately 2,000 people and food processing plants in Lincoln and Omaha that employ approximately 700 people.
“This was a very difficult decision for the company,” said Michael E. Brown, Armour-Eckrich president. “We are proud of the workers of Hastings and the plant’s record of performance. Unfortunately, we need to find ways to improve our operating efficiencies to remain competitive. And this often means consolidating operations.”
“Any time there’s any type of layoffs or closings, you are always disappointed,” said Tom Hastings, president of the Hastings Area Chamber of Commerce. “Any time you lose that many jobs in a community the size of Hastings, that’s like Lincoln losing 1,000 jobs or Omaha losing 2,000 jobs.”
Hastings has a population of approximately 25,000 people.
Hastings said the Armour-Eckrich plant was one of the city’s larger employers. He said the loss of those jobs will have a ripple effect throughout the community, from the retail sector to the school district.
Instead of sitting back and thinking how bad losing that employer will be, Hastings said, it’s time for the community to look for other opportunities to bring employment to town.
“What’s really sad and the one point I try to make to everybody is the fact that it’s not the employees’ fault,” he said. “It has to do with the company and what is going on in the economy.”
While the plant won’t close until July, Hastings said that gives the community time to help those employees transition to other areas of employment.
“One of the things we suggest to people is to contact Workforce Development because there are jobs out there that they wouldn’t think about,” he said.
Chamber members will meet today to discuss different options available to help the community with the closing of the plant.
“What’s tough about a community our size is that, if you have a good work force and something like this happens, you hate to see those people leave because they may not end up coming back,” Hastings said. “Like with any workers, if there are jobs somewhere else, they will have to go.”
Brown said the company will work with area businesses and services to help find opportunities for employees and coordinate with the local unemployment office to assist employees with claims or job applications.
He said the company will comply with the federal Worker Adjustment and Retraining Notification (WARN) Act, including providing a 60-day notification of the plant closure.
Under the WARN Act, Armour-Eckrich also will notify state dislocated worker units so they can promptly offer dislocated workers assistance, he said.
C. Larry Pope, Smithfield president and chief executive officer, said the restructuring plan will create “true synergies between our independent operating companies and produce more opportunities to improve the bottom line in the future.”
“Combined with the several plant closures we have made over the last three years, this restructuring should improve operating rates dramatically, allowing us to shed low-margin business,” he said.
Pope said Smithfield’s previous focus had been on growth “based on opportunistic acquisitions of high-quality companies at distressed prices.”
“Now we want to fully assimilate and integrate these enterprises, driving operating efficiencies and growing our high-margin packaged-meats business,” he said.
Smithfield is the world’s largest pork producer and processor.
While Smithfield said Tuesday’s action was due to the company’s need to restructure acquisitions, the global economy is reducing sales.
Larry Sitzman, executive director of the Nebraska Pork Producers, said producers are losing money on selling their animals.
Prior to the economic downturn, pork producers were hit hard by high grain prices.
“The big concern in our industry today is profitability and risk management,” Sitzman said. “The main indicators are this nation’s economic situation and will consumers in the United States be able to afford the product that producers can produce that still allows profit to the producer.”
Sitzman said pork producers reduced the number of breeding sows last year and there will be fewer pigs coming to market this year.
“That means there will be less supply, which normally means that prices will go up,” he said. “But will consumers be able to afford it, and what protein will they choose to take home to cook?”
Also, after 17 years of the U.S. pork industry setting records in exports, Sitzman said the big question remains whether those sales will continue in light of the global economic downturn.
“I hate to see any value-added animal agriculture business slow down or close in the state because that’s the main thing we have tried to promote in agriculture for years — adding value to agricultural products in our local communities,” Sitzman said.
He said that, when a plant such as Armour-Eckrich that adds value to a pork product closes in Nebraska, it’s the loss of another local market for state pork producers.
“We are concerned and concerned for the people who work there,” he said.
The Hastings plant produces packaged meats for retail, deli and food service customers.
Smithfield announced the plan on Tuesday.
Company officials said the plan will streamline the manufacturing operations of Smithfield’s pork group from seven to three companies. They expect the restructuring to save the company approximately $55 million in fiscal year 2010 and $125 million by fiscal year 2011.
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| Armour-Eckrich Meats LLC will be closing in July, cutting 370 jobs in the Hastings community. Smithfield Foods, the nation's largest pork producer, said Tuesday that it would restructure its pork business by shuttering six factories and cutting 1,800 jobs. (AP Photo/Hastings Tribune, Brent McCown) |
Along with Hastings, the company said the plants that will close by December are in Smithfield, Va.; Plant City, Fla.; Elton, N.C.; Great Bend, Kan.; and New Riegel, Ohio.
Armour-Eckrich Meats employs 3,100 employees in 13 states. The company has nine processing plants and five sales and marketing offices. Smithfield purchased Armour-Eckrich in 2006 from ConAgra Foods.
Along with the Hastings plant, Smithfield also owns the pork processing plant in Crete that employs approximately 2,000 people and food processing plants in Lincoln and Omaha that employ approximately 700 people.
“This was a very difficult decision for the company,” said Michael E. Brown, Armour-Eckrich president. “We are proud of the workers of Hastings and the plant’s record of performance. Unfortunately, we need to find ways to improve our operating efficiencies to remain competitive. And this often means consolidating operations.”
“Any time there’s any type of layoffs or closings, you are always disappointed,” said Tom Hastings, president of the Hastings Area Chamber of Commerce. “Any time you lose that many jobs in a community the size of Hastings, that’s like Lincoln losing 1,000 jobs or Omaha losing 2,000 jobs.”
Hastings has a population of approximately 25,000 people.
Hastings said the Armour-Eckrich plant was one of the city’s larger employers. He said the loss of those jobs will have a ripple effect throughout the community, from the retail sector to the school district.
Instead of sitting back and thinking how bad losing that employer will be, Hastings said, it’s time for the community to look for other opportunities to bring employment to town.
“What’s really sad and the one point I try to make to everybody is the fact that it’s not the employees’ fault,” he said. “It has to do with the company and what is going on in the economy.”
While the plant won’t close until July, Hastings said that gives the community time to help those employees transition to other areas of employment.
“One of the things we suggest to people is to contact Workforce Development because there are jobs out there that they wouldn’t think about,” he said.
Chamber members will meet today to discuss different options available to help the community with the closing of the plant.
“What’s tough about a community our size is that, if you have a good work force and something like this happens, you hate to see those people leave because they may not end up coming back,” Hastings said. “Like with any workers, if there are jobs somewhere else, they will have to go.”
Brown said the company will work with area businesses and services to help find opportunities for employees and coordinate with the local unemployment office to assist employees with claims or job applications.
He said the company will comply with the federal Worker Adjustment and Retraining Notification (WARN) Act, including providing a 60-day notification of the plant closure.
Under the WARN Act, Armour-Eckrich also will notify state dislocated worker units so they can promptly offer dislocated workers assistance, he said.
C. Larry Pope, Smithfield president and chief executive officer, said the restructuring plan will create “true synergies between our independent operating companies and produce more opportunities to improve the bottom line in the future.”
“Combined with the several plant closures we have made over the last three years, this restructuring should improve operating rates dramatically, allowing us to shed low-margin business,” he said.
Pope said Smithfield’s previous focus had been on growth “based on opportunistic acquisitions of high-quality companies at distressed prices.”
“Now we want to fully assimilate and integrate these enterprises, driving operating efficiencies and growing our high-margin packaged-meats business,” he said.
Smithfield is the world’s largest pork producer and processor.
While Smithfield said Tuesday’s action was due to the company’s need to restructure acquisitions, the global economy is reducing sales.
Larry Sitzman, executive director of the Nebraska Pork Producers, said producers are losing money on selling their animals.
Prior to the economic downturn, pork producers were hit hard by high grain prices.
“The big concern in our industry today is profitability and risk management,” Sitzman said. “The main indicators are this nation’s economic situation and will consumers in the United States be able to afford the product that producers can produce that still allows profit to the producer.”
Sitzman said pork producers reduced the number of breeding sows last year and there will be fewer pigs coming to market this year.
“That means there will be less supply, which normally means that prices will go up,” he said. “But will consumers be able to afford it, and what protein will they choose to take home to cook?”
Also, after 17 years of the U.S. pork industry setting records in exports, Sitzman said the big question remains whether those sales will continue in light of the global economic downturn.
“I hate to see any value-added animal agriculture business slow down or close in the state because that’s the main thing we have tried to promote in agriculture for years — adding value to agricultural products in our local communities,” Sitzman said.
He said that, when a plant such as Armour-Eckrich that adds value to a pork product closes in Nebraska, it’s the loss of another local market for state pork producers.
“We are concerned and concerned for the people who work there,” he said.
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