Tyson Foods shutters US pork plant amid slipping meat demands

15 Mar 2024 --- Tyson Foods will shut down its pork facility in Perry, Iowa, in the US, which is considered to be its economic base. The closure is expected to hugely impact its workforce of nearly 1,200 workers who fear losing their livelihood. This comes after the company closed six US chicken plants last year and revealed plans to stop operations at four other sites this year.

“After careful consideration, we have made the difficult decision to permanently close our Perry, Iowa pork facility,” a Tyson Foods Spokesperson tells Food Ingredients First.

While Tyson did not provide a reason for the closure, it maintains that Iowa remains a “key state for Tyson Foods, with employment of more than 9,000 team members across our other Iowa facilities.”

The plant slaughters approximately 9,000 pigs daily, accounting for nearly 2% of total US pork production.

According to Perry’s mayor, Dirk Cavanaugh, the facility is set to close on June 28, which will be a “big blow” to the community since Tyson is the largest employer in the area.

Workforce support
Mayor Cavanaugh recently met Tyson officials to discuss the Arkansas company’s role in supporting the employees.

He says it is crucial to look for another company to purchase the 384,300-square-foot plant near the state capital, Des Moines, adding that Tyson told him “it’s not just going to be a shut-the-door, leave-it-alone” departure.

The spokesperson informed us that the firm is “working closely with state and local officials to provide additional resources to those who are impacted.”

The company said it still employs 9,000 people in Iowa, with pork facilities in Waterloo, Storm Lake and Columbus Junction.

Finances and future outlook
According to Cavanaugh, a meatpacking plant would best fit the space and workers’ skills, although he doubts Tyson will sell the building to a direct competitor.

The company, which saw huge profits during the COVID-19 pandemic amid high meat prices, has since experienced a decline and slowing demand for some products.

The global meat industry and retailers are facing challenges due to declining consumer demands as prices and environmental concerns surge.Meanwhile, its CEO Donnie King recently said a larger supply of pigs compared to 2023 is improving its margins in pork.

Despite the recent closures of six chicken plants, two case-ready meat processing plants and the Perry plant, which is set to be the ninth, Tyson is investing in other areas of its business. In January, the meat and poultry company opened a US$355 million automated bacon processing plant in Kentucky, US, to support the expansion of its bacon production capabilities.

Last year, the company also entered a two-fold investment with insect ingredient formulator Protix to upcycle its by-products, such as Black Soldier Fly Larva (BSFL), into high-quality, sustainable insect proteins and lipids.

Meat industry struggles
The meat category, in general, is facing challenges due to softening consumer demands as price surge and awareness about its climate impact rises.

A recent FAO report predicted the global meat supply to expand between 2021 and 2030 to reach 374 metric tons by 2030. However, it flags that factors like consumer concerns about meat production systems, traceability and using antimicrobials in feeds are expected to slow down demands and imports.

The sector is also facing backlash from environmental analysts over high greenhouse gas emissions and demands for full transparency to predict emission numbers.

In the UK, retailers are being targeted by environmental campaigners who urged supermarkets to drop promotions on meat and dairy products in a bid to support net-zero emission targets last year.

Meanwhile in Australia, inflation has driven up meat and fish prices, steering consumers toward meat alternatives like plant-based meat.

By Insha Naureen

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