|
States Struggle To Keep Packing Plants, Supply Chains Open
SARA WYANT
WASHINGTON, D.C.
Across the country, dozens of packing plants workers have tested positive for COVID-19, leading to plant slowdowns while areas are cleaned and, in many cases, plants are shutdown altogether.
Smithfield Foods Inc., announced the indefinite closure of its Sioux Falls, S.D., plant on April 15. The plant represents 4 percent to 5 percent of U.S. pork production and employed about 3,700 people.
Shortly after, a Tyson pork processing facility in Columbus Junction, Iowa shut down, National Beef Packing closed its plant in Tama, Iowa. Cargill halted production at its Hazleton, Pa., ground beef and pork processing plant. And this week, JBS said it is indefinitely closing its pork production plant in Worthington, Minn. The facility is the third JBS plant to suspend operations following spikes in coronavirus infections. It shut down its Greeley, Colo., beef facility last week and another in Souderton, Pa., which has since reopened.
“The health of plant workers is very important, as is the health of other essential frontline workers in the food industry, such as those at grocery stores and warehouses. We need to both protect this work force and keep feeding our state and country,” noted the Iowa Pork Producers Association in a statement. “This country’s food supply chain is complex. It is vital to maintain this supply chain, especially those portions that operate in Iowa in order to provide food to Americans.”
The IPPA went on to point out something that is obvious to those who produce pork, beef, poultry, and eggs. The hardships in packing plants quickly spread to farmers who have no place to sell.
“The general public does not understand that the dynamics of production for meat, milk and eggs is a time sensitive conveyor belt,” says Iowa farmer Varel Bailey. “Today sows and cows are bred, eggs are set based on a scheduled harvest date. Any significant back up in the schedule is a disaster”
Kerns and Associates Economist Steve Meyer told Agri-Pulse that, if more plants shut down or stop buying, producers could face some tough decisions.
“The alternatives there are not good,” Meyer said. “People may have to euthanize pigs because they don’t have any place to go with them.”
However, he said producers could alter the diets and slow the growth rate on pigs in finishing barns, but pork production traditionally operates on a regimented schedule, and pigs must keep moving through the process until eventual slaughter.
Meyer said if the nation can begin to recover from COVID-19, there could be a rebound for the hog industry in the food service industry. He forecast 3 percent growth for pork production this year before coronavirus but said the forecast could be reduced.
“If we come out of this by June or July, I don’t think there will be a major calamity to the size of the industry. If it lasts for year, then all bets are off,” Meyer said.
Cattle country sees August flashbacks
The beef industry is also watching processing slow down as workers become infected. JBS USA recently announced the temporary closure of its Greeley, Colo., beef packing plant after 50 of its employees tested positive for coronavirus, two of whom passed away.
Speaking on a webinar last week, Kansas State University Livestock Economist Glynn Tonsor called the disruption a “once-in-a-lifetime shock.”
He also noted the exact size, location, and number of plants involved has an effect as larger clusters of beef plants dot certain parts of the country.
“By my assessment, no individual plant would represent over 7 percent of the national capacity ... there is a handful of beef plants that would be 5 ½ to 6 percent individually,” Tonsor said.
He said other packers could have the ability to absorb the production from a plant that slowed down, but there's currently uncertainty about how many of those plants might be slowed or shuttered and if so, for how long.
Derrell Peel, Oklahoma State University livestock marketing specialist, told Agri-Pulse last summer’s fire at a Tyson beef plant in Holcomb, Kan., provided a good case study after causing enormous ripples in the industry. But he said the coronavirus situation could be different because other plants were able to absorb processing.
“If we have multiple plants either down or restricted in terms of processing speed, we won’t have that kind of flexibility,” Peel said. “The difference this time is we face the likelihood that we could actually not be physically able to process all the cattle that are able to be processed.”
Peel also said if more plants slow down, feedlots will have to slow down placing cattle, which will lower feeder cattle markets.
Kansas Governor Laura Kelly announced this week that her state received additional supplies and personal protective equipment (PPE) to expand COVID-19 testing in counties centered around food and meat processing plants.
The plants in southwest Kansas account for 25 to 30% of the country’s beef processing.
“Agriculture is a facet of our state’s most critical infrastructure – Kansas doesn’t just feed the state, we feed the world,” Kelly said. “This is particularly true of our frontline workers in meatpacking plants across the state who process a significant portion of the nation’s supply.” ∆
SARA WYANT: Editor of Agri-Pulse, a weekly e-newsletter covering farm and rural policy. To contact her, go to: http://www.agri-pulse.com/
Editor’s note: Agri-Pulse Associate Editor Ben Nuelle contributed to this article
|
|