Cargill to idle beef processing plant in Texas, cuts 2,000 jobs

US-based agribusiness company Cargill is set to idle its beef processing facility in Plainview, Texas, US, on 1 February 2013, and lay off all 2,000 workers.

The company has blamed reduced cattle supply resulting from years of drought in Texas and Southern Plains states for this move.

Cargill noted that this decision, which was made after an exhaustive analysis of the current situation of regional cattle supply and processing capacity in North America, is expected to ease the strain placed on its beef business as a result of tight cattle supply.

The company’s plan to idle the Plainview facility includes measures for preserving its infrastructure for potential reopening if the US cattle herd rebounds and requires additional processing capacity.

According to the company, the US cattle herd is at its lowest level since 1952 and is not expected to significantly increase in size for a number of years.

Cargill Beef president John Keating said increased feed costs, together with herd liquidations by cattle ranchers, are contributing to the challenging business environment in the industry.

Following the move, Cargill’s remaining beef processing plants at Friona, Texas; Dodge City, Kansas; and Fort Morgan, Colorado, will receive cattle that were originally destined for the Plainview facility.

Its regional beef facilities at Fresno, California; Milwaukee, Wisconsin; and Wyalusing, Pennsylvania and Schuyler, Nebraska; as well as two beef plants in Canada, will remain unaffected.

The company noted that its employees affected by the shutdown of the Plainview facility will be provided with support and assistance in finding jobs at other Cargill locations or with other employers.

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Image: Cargill has blamed reduced cattle supply resulting from years of drought in Texas and Southern Plains states for the proposed closure of the Plainview beef processing facility. Photo courtesy of Cargill, Incorporated.