Top Pork Producer Shuts Key Plant and Warns of Meat Shortfall

Top Pork Producer Shuts Key Plant and Warns of Meat Shortfall (Source Bloomberg)

The world’s biggest pork producer is shuttering a major U.S. plant indefinitely after a coronavirus outbreak among employees, with the company warning that closures across the country are taking American meat supplies “perilously close to the edge” of shortfalls. Smithfield Foods Inc. will idle its Sioux Falls, South Dakota, pork-processing facility, which accounts for 4% to 5% of U.S. production, the company said in a statement Sunday. The move comes after state officials reported more than 200 cases of Covid-19 for plant employees, adding to a spike in infections that’s seen hundreds of American meat workers get sick. Plants have been forced to shutter or reduce output. “The closure of this facility, combined with a growing list of other protein plants that have shuttered across our industry, is pushing our country perilously close to the edge in terms of our meat supply,” Smithfield’s Chief Executive Officer Ken Sullivan said in the statement. “It is impossible to keep our grocery stores stocked if our plants are not running.” While it’s unclear whether the meat-employee infections have anything to do with the workplaces, the news exposes the vulnerability of global supply chains that are needed to keep grocers stocked after panic buying left shelves empty. The shuttered plants and sick workers are adding to other disruptions caused by the virus that’s making it harder for food to get from farm to table. Trucking bottlenecks, and snarled port traffic have also contributed to why shoppers are seeing empty shelves. The surge in cases has also raised concerns over worker safety. Deaths have been reported for employees at meat facilities owned by JBS SA and Tyson Foods Inc. Laborers have, in some cases, staged walk-outs to protest working conditions. In meat plants, stations on processing lines can be close together, creating challenges for social distancing. Workers also share break and locker rooms. Smithfield, owned by Hong Kong-listed WH Group, originally planned to shutter the South Dakota facility for three days.

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